Updates to Singapore’s Money Laundering National Risk Assessment and Terrorism Financing National Risk Assessment
We have set out below a brief summary of the following updates:
Who is affected by these updates?
The scope of the new updates is applicable to all Financial Institutions (“FIs”). FIs are required to update the EWRA assessment, where applicable.
Key considerations
ML NRA overview
When performing the enterprise-wide ML/TF risks assessment, FIs should take into account findings from the ML NRA, including (i) key ML and notable threats, and (ii) financial or nonfinancial sector that has been identified as presenting higher ML risks. The nature and extent of AML/CFT risk management systems and controls should be commensurate with the ML/TF risks identified via the enterprise-wide ML/TF risk assessment process. In particular, FIs should also:
- incorporate ML NRA findings on higher risk sector results into their customer risk assessment process
- consider findings on key ML threats, including crime types, typologies highlighted in the ML NRA when performing on-going monitoring of the conduct of customers’ accounts and scrutiny of customers’ transactions
- strengthen engagement and collaboration with authorities (e.g. through public-private partnerships)
- develop and deploy the use of data analytics and other advanced detection techniques to identify bad actors.
‘New’ sectors not covered in previous ML NRA:
- digital payment token services providers
- precious stones and precious metals dealers.
TF NRA overview
The updated 2024 TF NRA articulates the latest TF threats and vulnerable sectors in Singapore. It takes into account key developments since the last TF NRA in 2020, such as the evolving global and regional terrorism landscape, growth of the digital economy and financial services in Asia, and emerging TF risk typologies. Similar to 2020, the 2024 TF NRA has observed that the TF threat of raising and moving funds for terrorists and terrorism activities overseas remains pertinent in Singapore’s context. Self-radicalised individuals continue to pose the most salient TF threat to Singapore.
Key TF risk areas in 2024
The key TF risk areas in 2024 are largely similar to those identified in 2020:
- money remittances remain at high risk, with cross-border online payments identified as a potential new channel for TF activities
- banks remain at medium-high risk, with new cross-border fast payment systems identified as a potential new channel for TF activities
- digital payment token service providers have been elevated from medium-low to medium-high risk
- non-profit organisations remain at medium-low risk, with foreign online crowdfunding identified as an emerging TF typology of concern
- cross border cash movements remain at medium-low risk
- precious stones, precious metals, and precious products remain at medium-low risk.
Objectives of Singapore’s National Strategy
The 2024 TF NRA supports the refreshed objectives of Singapore’s National Strategy for CFT, launched in 2022, namely:
- prevent
- detect
- disrupt.
Implementation of the National Strategy
To achieve the above objectives, Singapore will implement the refreshed five-pronged National Strategy for CFT:
- coordinated and comprehensive risk identification
- strong legal and sanctions frameworks
- robust regulatory regimes
- decisive enforcement actions
- international partnerships and cooperation.
How Waystone can help
For more information you can refer directly to MAS’ Circular. If you have any further questions on this topic, please do not hesitate to reach out to your usual Waystone representative or contact us below.