OCBC CUSTOMER IMPLICATED
MAS fined OCBC S$600,000 for breaches between June 2015 and January 2016, relating to accounts maintained by one corporate customer.
The bank failed to look into the background and purpose of the transactions even though they were not consistent with its knowledge of the customer and their business. The transactions were also “unusually large and exhibited an unusual pattern that had no apparent economic purpose”.
“OCBC also failed to probe into the customer’s ownership and control structure when the customer’s declared beneficial owner was not a party named in the customer’s corporate registration documents,” said MAS.
A spokesperson for OCBC said the Wirecard case involved an “intricate web of entities and transactions” in multiple jurisdictions, and that one of its business banking customers was implicated.
“We take such matters seriously. Over the past few years, we have devoted significant resources to a strategic uplift of our anti-money laundering and combating the financing of terrorism standards and capabilities,” the spokesperson said.
CITIBANK FAILED TO LOOK INTO “UNUSUALLY LARGE TRANSACTIONS”
Citibank was fined S$400,000 for breaches between September 2019 and June 2020 relating to accounts maintained by two corporate customers.
MAS said that Citibank failed to adequately understand the control structure of the customers and failed to correctly identify the customers’ beneficial owners.
This was despite having information that suggested the control structure and beneficial owners declared by the customers were incorrect.
“Citibank also failed to inquire into unusually large transactions that had significantly exceeded one customer’s past transaction amounts and that had no apparent economic purpose,” said the central bank.
“This included an outflow to a party allegedly involved in fraud.”
A spokesperson for Citibank said the case dates back to before June 2020 and it has since taken steps to strengthen its processes.
INSURER SWISS LIFE FINED
Swiss Life (Singapore) was fined S$200,000 for breaches in May 2017 for an investment-linked life insurance policy it had underwritten.
According to MAS, the insurer failed to sufficiently understand the reasons behind the higher-risk customer’s complex ownership and control structure. It also failed to adequately corroborate the source of wealth of the customer’s beneficial owner.
CNA has contacted Swiss Life for its response to the fine.
MAS said the financial institutions have taken prompt remedial actions to address the deficiencies identified.
These included enhancements to their procedures and processes, and training to improve staff’s vigilance in detecting and escalating risk concerns.
“As Singapore grows in importance as an international financial centre, MAS expects our financial institutions to step up their controls against facilitating illicit financial flows,” said Ms Ho Hern Shin, deputy managing director of financial supervision at MAS.
“They must implement robust measures to know their customers, monitor ongoing transactions to ensure that these are consistent with their understanding of their customers and their businesses, and exercise greater vigilance when customers use complex structures.”