
Knowledge Highlights 13 May 2025
On 1 March 2022, the Monetary Authority of Singapore (“MAS”) issued a new anti-money laundering and countering the financing of terrorism (“AML/CFT”) notice for financial institutions (“FIs”) in the conduct of their operations and business activities in precious stones, precious metals and precious products (“PSM”) (“PSM Notice”), and revised the existing AML/CFT notices for FIs and variable capital companies (“VCCs”).
MAS published a consultation paper on 9 July 2021 seeking feedback on draft versions of the abovementioned notices. On 1 March 2022, MAS issued a response to the feedback received, stating that it has incorporated appropriate feedback received into the relevant notices, or will incorporate them into the relevant guidelines accompanying the notices.
Highlights of MAS’ response are set out below.
New AML/CFT notice for FIs dealing in PSMs
MAS proposed to issue a new notice for FIs dealing in PSMs to ensure consistency in the AML/CFT requirements across all FIs dealing in PSMs, instead of expanding the requirements in the existing AML/CFT notices to apply to the FIs’ PSM activities. MAS noted that respondents generally supported the proposal.
Definition of “regulated dealing”
In its response, MAS stated that the PSM Notice applies only when an FI itself conducts regulated dealing (i.e. buying PSMs from or selling PSMs to its customers) or is an intermediary in regulated dealing (e.g. an FI sells PSMs on behalf of its customer). MAS clarified that an FI facilitating its customers’ purchase and sale of PSM, which is understood to be the provision of financial services to customers that are involved with PSMs (i.e. processing of financial transactions, such as wire transfers, for a customer which is a PSM dealer), would not make an FI an intermediary in regulated dealing.
Customer due diligence requirements
MAS clarified that FIs are not required to designate separate accounts for each specific business activity of their customers. Thus, an FI may use the same account for both regulated dealing and other business activities of a customer, if that is in line with its policy, procedures and business considerations.
MAS also clarified that the requirement for FIs to perform the customer due diligence (“CDD”) measures on occasional transactions with value exceeding S$20,000 may be done on an ex-ante basis.
Amendments to existing AML/CFT notices
Proposed alignment of existing AML/CFT requirements with that for digital payment token service providers
MAS sought views on aligning the existing AML/CFT requirements for banks, merchant banks, finance companies, credit card or charge card licensees and capital markets services licensees in relation to digital token transactions they conduct, with that for digital payment token (“DPT”) service providers.
Proposed requirement of enhanced CDD measures for higher risk shell companies
MAS also clarified that “substantive financial activity in the customer’s interactions with the FI” refers to financial activities that can be reasonably explained by or traced to the customer’s business or activities, based on CDD conducted by FIs in accordance with the applicable AML/CFT notice requirements.
Proposed wire transfer and correspondent account requirements for credit card or charge card licensees
In relation to credit card or charge card licensees, MAS noted that there no comments or objections to its proposal to introduce requirements pertaining to wire transfers and correspondent accounts within MAS Notice 626A.
Proposed requirement of disclosure to designated non-financial businesses and professions and VCCs for licensed trust companies and approved trustees
MAS noted that there were no comments or objections to the proposed requirement for licensed trust companies and approved trustees to disclose to designated non-financial businesses and professions and VCCs when they act as trustees.
Reference materials
The following materials are available on the MAS website www.mas.gov.sg: