Several prominent local and international banks in Singapore, including DBS Group Holdings Ltd and Bank of Singapore Ltd, have become entangled in one of the city-state’s largest money laundering cases. According to business filings seen by Bloomberg News, these banks are creditors to investment firms connected to individuals who were recently arrested and charged in a case involving over S$1 billion ($740 million USD) of assets. The accused individuals also attempted to deceive Standard Chartered Plc with counterfeit documents, as revealed during a court hearing in Singapore on Wednesday.
These banks join a growing list of financial institutions, including CIMB Bank Bhd, Citigroup Inc.’s local subsidiary, and Deutsche Bank AG, that have been linked to suspects involved in the alleged money laundering ring. Additionally, property agents, precious metals dealers, and golf clubs in Singapore have also been implicated, raising concerns about the effectiveness of measures against illicit money entering one of the world’s most significant financial hubs.
Prior to this case, Singapore had already faced scandals involving large money flows from Malaysia’s state fund 1MDB and German firm Wirecard AG. These incidents resulted in the banning of financiers, imprisonment of individuals, and fines imposed on banks for inadequate controls. In response, lawmakers passed a bill in May that enables banks to share information on potentially risky clients.
DBS registered four charges on August 18, 2021, to Aiqinhai Investment Pte, while Bank of Singapore registered a charge on January 7, 2022, for Xinbao Investment Holdings Pte. Both investment firms have office addresses in Singapore’s business district, and the accused directors have upscale residential addresses. The banks’ facilities are secured against “all monies” at the companies, although the exact exposure size was not specified in the filings.
Prosecutors have stated that they are seeking documents from at least ten financial institutions related to this case, although the institutions were not named. The Monetary Authority of Singapore has previously stated that it is conducting supervisory engagements with financial firms where potentially tainted funds have been identified and will take firm action against any breaches of anti-money laundering and related rules.
The ongoing court hearings for the ten individuals arrested have resulted in additional charges related to money laundering and forgery. Prosecutors have described the accused as wealthy individuals with overseas assets.