Regulatory Update April 2025 – APAC Region

On 08 April 2025, the Monetary Authority of Singapore (MAS) issued a consultation paper proposing amendments to the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Notices and Guidelines for Financial Institutions (FIs) and Variable Capital Companies (VCCs).

These proposed changes draw reference from the latest standards set by the Financial Action Task Force. Industry participants are invited to comment on these proposed changes by 08 May 2025.

The MAS is targeting to finalise the suggested amendments by 30 June 2025.

The key changes are summarised as follows:

1. Inclusion of Proliferation Financing (PF)
   Clarifies that Money Laundering (ML) includes PF and that FIs and VCCs are required to assess PF risks within their ML/TF Framework.Whilst PF is positioned as an amendment, PF is in substance not something new or unfamiliar to FIs and VCCs.
2. Enhancements for Trust Companies (TCA – N03)
   Expands the definition of “trust relevant parties” to include “protector”, “class of beneficiaries”, “object of a power”, and “any other persons with the power under the legal arrangement instrument or by law” to, for example, manage the trust property, thereby enhancing the definition and clarifying the requirements to identify all related parties.Specifies the additional information in respect of trust relevant parties to be obtained during AML/CDD checks.
3. Suspicious Transaction Reports (STRs) Timeline
   STRs must be filed within five business days after suspicion is established and within one business day for sanctioned parties or parties acting on behalf of or under the direction of sanctioned parties.FIs and VCCs are no longer required to extend a copy of STRs filed to MAS for information, unless requested, as the MAS is able access STRs filed with STRO directly.

Other Amendments:

• Enhanced Name Screening:
  Clarify that where necessary, screening for ML/TF risks should incorporate pertinent search engines used in countries or jurisdictions closely linked to the individual being screened and should be carried out in the individual’s native language(s).

• Comprehensive Source of Wealth (SoW) and Source of Fund (SoF) Assessment:
  Further emphasis on the measures taken to ascertain the SoW and SoF of investors including adopting a risk-based approach for higher ML/TF risks, to use reliable and independent sources of information to corroborate SoW and SoF, etc.

• Shell Companies Risk Indicators:
  Inclusion of characteristics of a higher-risk shell company that FIs and VCCs should consider as examples of potentially higher-risk categories under paragraph 8.7 of MAS Notice 626 and equivalent provisions in other AML/CFT Notices.

• Enhanced Internal Collaboration:
  To promote effective sharing of AML-related information across business units, strengthen staff training in identification of fraudulent/tempered information, and ensure timely escalation of complex or high-risk cases.

To view the consultation, please click here.

The report sets out the enforcement actions taken by the Monetary Authority of Singapore (MAS) for the period of 1 July 2023 to 31 December 2024 and outlines MAS’ key enforcement priorities for 2025/2026.

Unsurprisingly, Anti-Money Laundering and Countering the Financing of Terrorism Enforcement (AML/CFT) remains a key priority for the MAS. Board of directors and senior managers of Financial Institutions (FIs) are expected to exercise strong oversight over ML/TF risks, as well as ensure the effective implementation of key AML/CFT controls. MAS has and will continue to take firm action against Directors and senior managers who do not properly discharge their duties. The following enforcement cases were featured in the enforcement report, and it emphasizes the importance of ensuring robust AML/CFT related controls.

Swiss-Asia Financial Services Pte. Ltd. (SAFS)
MAS imposed a composition penalty of S$2.5m on SAFS in May 2024. SAFS’ CEO, Mr. Oliver Pascal Mivelaz and its COO, Mr. Steve Knabl were reprimanded for failing to ensure that SAFS complied with MAS’ AML/CFT requirements. SAFS experienced significant business growth but its AML/CFT controls did not keep pace with the growth and were inadequate. This resulted in multiple breaches of MAS’ AML/CFT requirements and exposed SAFS to the risk of financial crime.

Atrium Asia Investment Management Pte. Ltd. (AAIM)
MAS imposed a composition penalty of S$1.9m on AAIM in October 2024. AAIM’s CEO, Mr. Mintarja Oei, was reprimanded for failing to ensure that AAIM complied with MAS’ AML/CFT requirements. MAS’ inspection of AAIM found that the Company’s internal AML/CFT policy and procedures at the material time were inadequate. This led to multiple breaches of MAS’ AML/CFT requirements from June 2015 to October 2020, putting the firm at risk of being misused for financial crime.

Singapore’s $3b Money Laundering Case
On 15 August 2023, the Singapore Police Force commenced investigations into a S$3 billion money laundering case. 10 foreign nationals were arrested and subsequently convicted. MAS conducted supervisory reviews of FIs that had business relations (such as account opening and maintenance) with persons involved in the money laundering activities.

MAS is in the process of reviewing AML/CFT breaches by FIs and their key staff and will undertake enforcement actions for serious breaches.

To view the enforcement report, please click here.

On 07 April 2025, The Securities and Futures Commission’s (SFC) issued a revised circular, outlining requirements for authorising investment funds in Hong Kong with over 10% exposure to virtual assets (VA) in their net asset value (NAV) for public offerings, superseding the December 2023 circular (circular).

The circular addressed rising demand for virtual asset investment products, authorising funds with over 10% VA exposure to invest in spot VA tokens on SFC-licensed platforms or indirectly via regulated futures, while adhering to strict regulatory and custody standards.

Management companies must demonstrate VA expertise, ensure secure storage primarily in cold wallets, use reputable benchmark indices for valuation, and disclose risks, with no leveraged VA exposure allowed.

Funds may engage in staking and other VA activities with SFC approval, subject to robust risk controls and disclosures, but the circular excludes Recognized Jurisdiction Schemes and may impose additional conditions.

To view the circular, please click here.

On 28 April 2025, The Securities and Futures Commission’s (SFC) issued a circular related to the Fund Authorisation Simple Track (FASTrack) (circular).

The SFC will formally adopt the Fund Authorisation Simple Track (FASTrack) starting 05 May 2025, following a successful six-month pilot launched on 04 November 2024.

FASTrack targets simple funds from Mutual Recognition of Funds (MRF) Jurisdictions, aiming to authorise them for public offering in Hong Kong within 15 business days to enhance efficiency and competitiveness.

According to the circular, the pilot received positive feedback, with all eligible applications authorised within the target timeframe, and the SFC will continue to monitor and improve FASTrack’s operations.

To view the circular, please click here.