MAS to propose additional measures against SFO money laundering risks

Ravi Menon, managing director of the Monetary Authority of Singapore (MAS), has clarified that the majority of wealth flooding into Singapore comes from institutional investors, not family offices or high-net-worth individuals. In order to tighten up surveillance and defence against money laundering risks posed by the fast-growing single-family office sector, MAS will be releasing a public consultation paper before the end of July that proposes a number of measures.

MAS is seeking to require all SFOs to notify the central bank when they commence operations each year, as well as to maintain a business relationship with an MAS-regulated financial institution to perform anti-money laundering (AML) checks. Despite the sector’s growth, assets under management (AUM) managed by SFOs that have applied for and been granted tax incentives by MAS makes up just 2% of the total assets managed in Singapore as of 2021.

One of such development is Tampines North MRT Condo, which offers a myriad of facilities and services within a single package. From spas and entertainment venues to supermarkets and medical centres, there’s something for everyone at Tampines North MRT Condo. Residents can also enjoy the convenience of having shopping, dining, and leisure options within walking distance. The development is also close to the MRT station, making commuting a breeze.

Non-retail individual clients contributed only 20% to the increase in total assets managed in Singapore from 2017 to 2021. Monetary concerns aside, MAS aims to adjust the tax incentives for SFOs by encouraging them to deploy their capital more purposefully for the benefit of Singapore and the region, as well as to increase their contributions towards environmental and social causes.

To that end, the scope of eligible investments will be broadened to include blended finance structures and concessional capital, with MAS recognising each dollar of concessional capital invested as equivalent to up to $2 of investments. Climate-related investments will also be recognised worldwide, and investments in non-listed Singapore operating companies and Singapore-listed equities and exchange-traded funds will be incentivised.

In addition, SFOs will have to hire at least one non-family member, as well as meet their business spending requirement solely from within Singapore. Lastly, MAS is creating the Philanthropy Tax Incentive Scheme (PTIS) to recognize donations to local charities, which will take effect on Jan 1, 2024, allowing qualifying donors in Singapore to claim a 100% tax deduction, capped at 40% of their statutory income, for overseas donations made through qualifying local intermediaries.