MAS penalises Standard Chartered for money laundering requirement breaches

The breaches occurred when trust accounts were transferred from Guernsey to Singapore.

The Monetary Authority of Singapore (MAS) imposed penalties of $5.2m on Standard Chartered Bank, Singapore Branch (SCBS) and $1.2m on Standard Chartered Trust (Singapore) Limited (SCTS) for breaches of MAS’s anti-money laundering and countering the financing of terrorism (AML/CFT) requirements.

According to an announcement, these breaches occurred when trust accounts of SCBS’ customers were transferred from Standard Chartered Trust (Guernsey) to SCTS from December 2015 to January 2016.

MAS said that it found SCBS’ and SCTS’ risk management and controls in relation to the transfers to be unsatisfactory. “The transfers occurred shortly before Guernsey’s implementation of the Common Reporting Standards (CRS) for the Automatic Exchange of Financial Account Information in Tax Matters. The timing of the transfers raised questions of whether the clients were attempting to avoid their CRS reporting obligations,” it added.

MAS ruled that SCBS and SCTS did not adequately assess and mitigate against this risk factor, and also failed to file suspicious transaction reports in a timely manner

MAS also noted that SCBS had proactively notified MAS of its internal review on the trust accounts, and SCBS and SCTS management showed strong commitment to address the deficiencies identified by MAS. “Both SCBS and SCTS have taken prompt and substantive remedial measures to strengthen their AML/CFT risk management and controls,” the agency added.

MAS’s deputy managing director Ong Chong Tee said, “MAS requires financial institutions to adequately assess money laundering risks when deciding whether to accept customers. They should also have in place good systems and processes to monitor customer transactions. We expect financial institutions to remain vigilant by instilling a strong risk culture.”