Summary of Singapore’s FATF Mutual Evaluation

Singapore’s mutual evaluation with the Financial Action Task Force (FATF) and Asia/Pacific Group on Money Laundering (APG) recently concluded on September 2016 and here are the summarised results.

Rating Methodology

Immediate Outcomes (I.O) represents the country’s key goals that a robust and effective Anti-Money Laundering /  Countering the Financing of Terrorism (AML/CFT) system should attain.  These are the four ratings that are given after the evaluation:

1. High level of effectiveness – The Immediate Outcome is achieved to a very large extent. Minor improvements needed.
2. Substantial level of effectiveness – The Immediate Outcome is achieved to a large extent. Moderate improvements needed.
3. Moderate level of effectiveness – The Immediate Outcome is achieved to some extent. Major improvements needed.
4. Low level of effectiveness – The Immediate Outcome is not achieved or achieved to a negligible extent. Fundamental improvements needed.

Pertaining to the technical compliance doctrine of FATF Recommendations, the following ratings are given to see the extent it is implemented.

1. Compliant.
2. Largely compliant – There are only minor shortcomings.
3. Partially compliant – There are moderate shortcomings.
4. Not applicable – A requirement does not apply, due to the structural, legal or institutional features of the country.

Singapore’s Overall Summary on Immediate Outcomes

Low Level of Effectiveness

• IO9 – Terrorist financing offences and activities are investigated and persons who finance terrorism are prosecuted and subject to effective, proportionate and dissuasive sanctions.

Moderate Level of Effectiveness

• IO3 – Supervisors appropriately supervise, monitor and regulate financial institutions and Designated Non-Financial Businesses and Professionals (DNFBPs) for compliance with AML/CFT requirements commensurate with their risks.
• IO4 – Financial institutions and DNFBPs adequately apply AML/CFT preventive measures commensurate with their risks, and report suspicious transactions.
• IO5 – Legal persons and arrangements are prevented from misuse for money laundering or terrorist financing, and information on their beneficial ownership is available to competent authorities without impediments.
• IO7 – Money laundering offences and activities are investigated and offenders are prosecuted and subject to effective, proportionate and dissuasive sanctions.
• IO8 – Proceeds and instrumentalities of crime are confiscated.
• IO10 – Terrorists, terrorist organisations and terrorist financiers are prevented from raising, moving and using funds, and from abusing the NPO sector.

Substantial Level of Effectiveness

• IO1 – Money laundering and terrorist financing risks are understood and, where appropriate, actions co-ordinated domestically to combat money laundering and the financing of terrorism and proliferation.
• IO2 – International co-operation delivers appropriate information, financial intelligence, and evidence, and facilitates action against criminals and their assets.
• IO6 – Financial intelligence and all other relevant information are appropriately used by competent authorities for money laundering and terrorist financing investigations.
• IO11 – Persons and entities involved in the proliferation of weapons of mass destruction are prevented from raising, moving and using funds, consistent with the relevant UNSCRs.

There is no I.O that achieved High Level of Effectiveness.

Singapore’s Overall Summary on Technical Compliance

Partially Compliant

• 22 – DNFBPs: Customer due diligence
• 23 – DNFBPs: Other measures
• 24 – Transparency and beneficial ownership of legal persons
• 25 – Transparency and beneficial ownership of legal arrangements
• 28 – Regulation and supervision of DNFBPs
• 35 – Sanctions

Largely Compliant

• 1 – Assessing Risks and Applying a Risk-Based Approach
• 3 – Money laundering offence
• 5 – Terrorist financing offence
• 6 – Targeted financial sanctions related to terrorism & terrorist financing
• 7 – Targeted financial sanctions related to proliferation
• 8 – Non-profit organisations
• 14 – Money or value transfer services
• 19 – Higher-risk countries
• 20 – Reporting of suspicious transactions
• 26 – Regulation and supervision of financial institutions
• 33 – Statistics
• 34 – Guidance and feedback
• 37 – Mutual legal assistance
• 38 – Mutual legal assistance: freezing and confiscation
• 39 – Extradition
• 40 – Other forms of international cooperation

Compliant

• 10 – Customer due diligence
• 11 – Record keeping
• 12 – Politically exposed persons
• 13 – Correspondent banking
• 15 – New technologies
• 16 – Wire transfers
• 17 – Reliance on third parties
• 18 – Internal controls and foreign branches and subsidiaries
• 2 – National cooperation and coordination
• 21 – Tipping-off and confidentiality
• 27 – Powers of supervisors
• 29 – Financial intelligence units
• 30 – Responsibilities of law enforcement and investigative authorities
• 31 – Powers of law enforcement and investigative authorities
• 32 – Cash couriers
• 36 – International instruments
• 4 – Confiscation and provisional measures
• 9 – Financial institution secrecy laws

There is no recommendation that received a Non-Compliant or Not Applicable rating.