The Monetary Authority of Singapore (MAS), Singapore Customs and some of Singapore’s financial institutions have launched a new platform to help the country counter trade-based money laundering (TBML).

Designed to address money laundering and terrorist financing risks in trade finance, the Trade Finance Compliance (TFC) government e-service has been introduced on the Networked Trade Platform (NTP).

Compliance challenges

The TFC aims to address compliance challenges faced by financial institutions when financing trade because of the inability to validate the underlying trade and the lack of reliable data to conduct price checks for non-commodity goods.

Using data derived from permits issued by Singapore Customs, the service allows financial institutions to reference such information to augment their checks for trade finance compliance.

Digital benefits

Executive director, financial markets development department at MAS, Gillian Tan, describes the TFC service as a “valuable risk management tool.”

By digitalising the trade finance compliance check process and directly referencing pricing and permit-related customs data on Singapore’s imports and exports, she believes the TFC will increase the efficiency and accuracy of trade finance compliance checks for financial institutions in Singapore.

Mitigating TBML risks

 “As a result, these financial institutions will be able to better assess fraud and mitigate risks associated with trade-based money laundering,” she says.

BNP Paribas, DBS Bank, ICBC, MUFG Bank, OCBC Bank and UOB have already signed up for the TFC Service on the NTP.

Categories: Trade Based Financial crimes News