Singapore, where Indonesians hold an
estimated US$200 billion in private banking assets - 40 percent of the island’s
total private banking assets - made tax evasion a money-laundering offence in
2013.
Singapore’s Commercial Affairs Department (CAD), a police unit that deals with financial crime, told banks last year they must file a suspicious transaction report (STR) whenever a client takes part in a tax amnesty scheme, three banking sources told Reuters.
After initial resistance from the banks, worried they might lose clients, that message was reinforced this year by the Monetary Authority of Singapore (MAS), the country’s central bank, when Indonesia launched a tax amnesty aimed at wooing back some of the cash its wealthy citizens have stashed in Singapore, the sources said.
Singapore, where Indonesians hold an estimated US$200 billion in private banking assets - 40 percent of the island’s total private banking assets - made tax evasion a money-laundering offence in 2013.
It is toughening up the implementation of the law after an investigation into state-backed fund 1MDB in neighboring Malaysia exposed how some of its banks failed to impose robust controls on suspicious money flows.
The STR requirement on suspected tax crimes is part of that process.
“The moment the client tells you he’s participating in the amnesty, you have a suspicion that the assets with you are not compliant and so you have to report to the authorities,” said a senior executive at a Singapore-based wealth manager.
Singapore’s Commercial Affairs Department (CAD), a police unit that deals with financial crime, told banks last year they must file a suspicious transaction report (STR) whenever a client takes part in a tax amnesty scheme, three banking sources told Reuters.
After initial resistance from the banks, worried they might lose clients, that message was reinforced this year by the Monetary Authority of Singapore (MAS), the country’s central bank, when Indonesia launched a tax amnesty aimed at wooing back some of the cash its wealthy citizens have stashed in Singapore, the sources said.
Singapore, where Indonesians hold an estimated US$200 billion in private banking assets - 40 percent of the island’s total private banking assets - made tax evasion a money-laundering offence in 2013.
It is toughening up the implementation of the law after an investigation into state-backed fund 1MDB in neighboring Malaysia exposed how some of its banks failed to impose robust controls on suspicious money flows.
The STR requirement on suspected tax crimes is part of that process.
“The moment the client tells you he’s participating in the amnesty, you have a suspicion that the assets with you are not compliant and so you have to report to the authorities,” said a senior executive at a Singapore-based wealth manager.
The Singaporean government and its banking sector
harbored the intention to see Indonesia’s tax amnesty program fail.
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