Enforcement Actions
MAS published its second Enforcement Report and continues to work with the Commercial Affairs Department (CAD) and other agencies to ensure that a high level of public trust and confidence in the financial sector is maintained. This section discusses the Enforcement Report as well as a selection of enforcement cases.
MAS published its second Enforcement Report
4 November 2020
The report highlighted that MAS had imposed S$11.7 million in civil penalties and, together with the Attorney-General’s Chambers, successfully secured the criminal convictions of nine individuals for market misconduct or related offences from 1 January 2019 to 30 June 2020. MAS also issued 25 prohibition orders against unfit representatives.
The average time taken by MAS to complete its reviews and investigations decreased from 33 months to 24 months in criminal cases, and from 30 months to 26 months in civil penalty cases, as compared against the previous reporting period. MAS investigated and took enforcement actions against financial institutions (FIs) with significant deficiencies in AML/CFT controls and senior managers who fell short in their duties. A total of S$3.3 million in composition penalties were imposed on FIs between 1 January 2019 to 30 June 2020.
The Singapore Police Force (SPF), the Infocomm Media Development Authority (IMDA) and MAS blocked unregulated overseas online trading platform
28 May 2020
SPF, IMDA and MAS took action to block an unregulated online trading platform, Arotrade, following police investigations which revealed that Arotrade was linked to fraudulent marketing tactics which misled members of public. The tactics included the use of fake news articles which falsely claimed that prominent individuals, including Singapore’s Political Office Holders, had endorsed the cryptocurrency investments.
CAD, MAS and the Accounting and Corporate Regulatory Authority (ACRA) commenced investigations against Hyflux Ltd
2 June 2020
MAS, together with CAD and ACRA commenced a joint investigation into Hyflux Ltd and its current and former directors for suspected false and misleading statements and breaches of disclosure requirements under the Securities and Futures Act, as well as non-compliance with accounting standards under the Companies Act.
MAS and CAD commenced investigations against Eagle Hospitality REIT Management’s directors and subsequently ordered its removal as REIT manager
5 June 2020 and 30 November 2020
On 5 June 2020, MAS, together with CAD, launched a joint investigation into the current and former directors, and officers of Eagle Hospitality REIT Management Pte Ltd (EHRM) for suspected breaches of disclosure requirements under the Securities and Futures Act. On 30 November 2020, MAS directed DBS Trustee Limited, in its capacity as the trustee of Eagle Hospitality Real Estate Investment Trust (EH-REIT), to remove EHRM as the manager of EH-REIT. This was in view of serious concerns with EHRM’s ability and commitment to comply with MAS’ rules and regulations.
- MAS media release, published on 30 November 2020, on directive to remove EHRM
- MAS media release, published on 26 October 2020, on Notice of Intention (NOI) to notify parties of intent to remove Manager of EH-REIT
- MAS media release, published on 5 June 2020, on investigation into officers responsible for managing Eagle Hospitality Trust
- MAS media release, published on 20 April 2020, on safeguarding of interests of unitholders of EH-REIT
Actions and investigations on Wirecard-related activities in Singapore
June to September 2020
In view of Wirecard AG’s insolvency, MAS on 30 June 2020 instructed Wirecard SG to hold their customers’ funds in segregated accounts with banks in Singapore. On 3 July 2020, arising from a review that followed allegations of revenue inflation against Wirecard AG, MAS and CAD launched a joint investigation into Citadelle Corporate Services Pte Ltd and Senjo Group Pte Ltd and its subsidiaries, for suspected falsification of accounts under the Penal Code, as well as carrying on a trust business without a licence under the Trust Companies Act. On 30 September 2020, MAS directed Wirecard SG to cease their payment services in Singapore and to return all customers’ funds, after Wirecard SG informed MAS of its inability to provide payment processing services to a significant number of merchants. Wirecard SG has since complied with MAS’ directions.
In view of Wirecard AG’s insolvency, MAS on 30 June 2020 instructed Wirecard SG to hold their customers’ funds in segregated accounts with banks in Singapore. On 3 July 2020, arising from a review that followed allegations of revenue inflation against Wirecard AG, MAS and CAD launched a joint investigation into Citadelle Corporate Services Pte Ltd and Senjo Group Pte Ltd and its subsidiaries, for suspected falsification of accounts under the Penal Code, as well as carrying on a trust business without a licence under the Trust Companies Act. On 30 September 2020, MAS directed Wirecard SG to cease their payment services in Singapore and to return all customers’ funds, after Wirecard SG informed MAS of its inability to provide payment processing services to a significant number of merchants. Wirecard SG has since complied with MAS’ directions.
- MAS media release, published on 30 September 2020, on MAS directing Wirecard to cease payment services in Singapore
- MAS media release, published on 3 July 2020, on investigation into Citadelle and Senjo following review of developments relating to Wirecard
- MAS media release, published on 30 June 2020, on Wirecard complying with MAS directions to keep customer funds in banks in Singapore
Actions taken against Goldman Sachs (Singapore) Pte (GSSP) and a former representative of BSI Bank Limited, Singapore Branch (BSIS) for breaches related to 1MDB
23 October 2020
The Goldman Sachs Group Inc (GSG) entered into a global Deferred Prosecution Agreement with the Department of Justice of the United States for GSG’s role in bond offerings related to 1MDB. Following this, MAS issued a direction to GSSP to appoint an independent external party to conduct a review of its remedial measures. MAS also issued lifetime Prohibition Orders against Mr Kevin Swampillai, a former representative of BSIS, for channelling a portion of fund management fees received from 1MDB to an entity beneficially owned by Mr Swampillai, without BSIS’ knowledge and authorisation, and for making misrepresentations to 1MDB auditors.
The Goldman Sachs Group Inc (GSG) entered into a global Deferred Prosecution Agreement with the Department of Justice of the United States for GSG’s role in bond offerings related to 1MDB. Following this, MAS issued a direction to GSSP to appoint an independent external party to conduct a review of its remedial measures. MAS also issued lifetime Prohibition Orders against Mr Kevin Swampillai, a former representative of BSIS, for channelling a portion of fund management fees received from 1MDB to an entity beneficially owned by Mr Swampillai, without BSIS’ knowledge and authorisation, and for making misrepresentations to 1MDB auditors.
SPF and MAS investigate companies under CoAssets Group
January 2021
On 12 January 2021, CAD and MAS launched a joint investigation into various companies under CoAssets Ltd (CoAssets Group Companies), following complaints and feedback received from members of the public regarding suspected misconduct by CoAssets Group Companies. Prior to this, MAS had issued a direction in March 2020 to CA Funding Pte Ltd (CAFPL), the only company belonging to CoAssets Group Companies that was regulated by MAS. The direction prohibited CAFPL from listing new issuances, onboarding new investors and accepting subscription of securities after lapses were uncovered during MAS’ inspection of the company.
MAS imposed composition penalty of S$1 million on Bank J. Safra Sarasin Ltd, Singapore Branch (BJS) for AML/CFT failures
14 April 2021
Between March 2014 to September 2018, BJS had committed serious breaches of MAS’ AML/CFT requirements. These breaches resulted from material lapses in BJS’s AML/CFT control processes during customer on-boarding and in the ongoing monitoring of business relations with customers, which had placed BJS at higher risk of being used as a conduit for illicit activities. In addition to the composition penalty, MAS ordered BJS to appoint an independent party to validate the effectiveness of the bank’s remediation measures and report the findings to MAS.