Money Remittance in Singapore at the Highest Risk of TF

The money remittance sector and banking sector in Singapore has become the highest target for criminals to exploit for terrorism financing. 

Monetary Authority of Singapore, MAS released a report on Terrorism Financing National Risk Assessment 2020 in Singapore and highlighted the major terrorism financing threats. 

The risk assessment discovered that the country is exposed to both regional and international terrorist groups’ threats. The money remittance is at the highest risk of being used by terrorists due to the cross-border flow of high volume funds to the countries that are more exposed to terrorism financing and terrorism groups. This added with the incompetent ability to imply CTF policies. 

MAS said, “While banks’ TF risk awareness and AML/CFT control measures are generally well developed, it is important to continue engaging the banks. This will enable them to keep abreast of the latest TF risks and typologies, and adopt relevant risk mitigation measures.”

MAS has urged the sector to further strengthen its policies to adhere to AML/CFT compliances. There has been an improvement in the country’s anti-money laundering regulation and risk awareness regarding digital assets. The banking sector and money remittance must strengthen terrorism financing risk awareness. 

The banking sector was highlighted as the second-highest risk of being manipulated for terrorist financing. This was due to Singapore’s exposure to the flow of money internationally. The country’s geographical location exposes it to countries with high terrorism actvities. Additionally, the banking sector has faced challenges in identifying the TF transactions as these transactions are usually in the form of small funds passed through in a form of salaries or savings.  

MAS will examine the banks’ risk management process and analyze their abilities in regard to detecting the flow of funds connected to terrorist activities. The Risk Assessment review also highlighted that non-profit organizations, digital payments tokens, cross-border cash flow, etc. also face the risk of terrorism financing.