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Singapore Cracks Down on Money Laundering in Real Estate Sector
In a bid to combat money laundering and terrorism financing, Singapore’s real estate sector is being scrutinized like never before. As a key player in the global financial system, Singapore has pledged to implement stringent anti-money laundering (AML) measures, in line with guidelines set by the Financial Action Task Force (FATF).
The Onus on Real Estate Salespersons and Estate Agents
For real estate salespersons (RESs) and estate agents (EAs), the onus is on them to detect and prevent money laundering and terrorism financing. They are required to:
- Conduct thorough customer due diligence checks
- Verify the identity of clients and beneficial owners
- Screen them against international watchlists
Why Property Transactions Are a Lucrative Avenue for Criminals
According to experts, property transactions involving large sums of money can be a lucrative avenue for criminals and terrorist groups to launder tainted funds. As such, RESs/ EAs play a critical role in identifying and reporting suspicious transactions.
The First Step: Conducting Customer Due Diligence Checks
The first step in preventing money laundering is conducting customer due diligence checks. This involves:
- Verifying the identity of clients and beneficial owners
- Assessing risk factors such as the nature and purpose of the transaction
- Establishing the source of wealth or funds
Additional Requirements for Real Estate Salespersons and Estate Agents
RESs/EAs are also required to:
- Report any suspicious transactions to the Suspicious Transaction Reporting Office (STRO)
- Failure to do so can result in fines and imprisonment
- Establish risk assessment procedures and internal controls to manage higher-risk property transactions
- Develop and implement compliance procedures
- Conduct regular training sessions for staff
- Maintain accurate records of all transactions
Singapore’s Commitment to Preventing Money Laundering and Terrorism Financing
Singapore’s real estate sector is a key player in the economy, and the authorities are taking steps to ensure that it remains a secure and transparent market. The Estate Agents (Prevention of Money Laundering and Financing of Terrorism) Regulations 2021 provides guidance on AML/CFT duties for RESs/EAs, and CEA has prescribed specific measures to prevent money laundering in the sector.
Conclusion
Singapore’s commitment to preventing money laundering and terrorism financing is unwavering, and its real estate sector must adapt to these new requirements to maintain its reputation as a trusted and secure market.