MAS, Singapore banks build digital platform against money laundering

This will allow sharing of customer and transaction data on money laundering cases.

The Monetary Authority of Singapore is collaborating with six banks in Singapore to create a digital platform that allows sharing of data amongst financial institutions (FIs) related to the prevention of money laundering, terrorism financing, and proliferation financing (PF).

DBS, OCBC, UOB, SCB, Citibank, and HSBC will participate in the creation of the platform, named COSMIC (Collaborative Sharing of ML/TF Information and Cases), with the goal of launching in the first half of 2023.

A common challenge that FIs in most jurisdictions face is that they are unable to warn one another about unusual activity in customers’ accounts, MAS said. 

“This gap is frequently exploited by financial criminals to make illicit transactions through a web of entities with accounts in different FIs, such that each FI on its own does not have sufficient information to detect these transactions in a timely manner,” the regulator noted in the press release.

COSMIC will reportedly enable FIs to securely share information on customers or transactions, where they cross material risk thresholds. This information sharing will help FIs identify and disrupt illicit networks.

Upon launching in 2023, the platform will initially focus on three key financial crime risks in commercial banking: abuse of shell companies, misuse of trade finance for illicit purposes, and PF. 

MAS assured that it will state in the legislation that information sharing amongst FIs is permitted only for the purpose of combating ML, TF and PF. 

The regulator will also require all COSMIC participants to implement robust measures to safeguard against unauthorised use and disclosure of COSMIC information.

MAS has invited interested parties to submit their comments on the proposals and legislative amendments for the creation of COSMIC on or before 1 November, outlined in the consultation paper that can be found on its website.