| Require all business entities carrying on a business of providing corporate services in and from Singapore to register with ACRA as registered CSPs |
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To require companies and other business entities that carry on a business in Singapore of providing any corporate service to be registered as registered CSPs, even if they do not file transactions on behalf of their customers with ACRA. This requirement includes companies and other business entities that carry on a business in Singapore of providing the corporate service of carrying out any designated activity in relation to the provision of any accounting service.
Registered CSPs will be required to comply with AML/ CFT/ PF obligations.
A person who breaches the requirement to be registered as a registered CSP is guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part of a day during which the offence continues after conviction.
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Currently, companies and other business entities that do not file transactions on behalf of their customers with ACRA are not required to be registered as registered filing agents (RFAs) and consequently are not subject to AML/ CFT/ PF obligations.
However, there is a regulatory gap as CSPs that are not RFAs may be engaged by customers to facilitate illicit activities. Therefore, the changes will enhance the regulatory regime for all CSPs, level the playing field for all CSPs carrying on business in Singapore, and enable ACRA to take enforcement action against registered CSPs that breach AML/ CFT/ PF obligations.
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| Require all registered CSPs to comply with obligations, including AML/ CFT/ PF obligations |
| To require registered CSPs to comply with obligations relating to financing of proliferation of weapons of mass destruction, in addition to obligations relating to anti-money laundering and counter terrorism financing. These obligations will be prescribed in subsidiary legislation. |
The changes will ensure consistency with the Financial Action Task Force’s (FATF) recommendations relating to AML/ CFT/ PF, and that registered CSPs comply with the requirements in the United Nations Act 2001. |
| Introduce fines for breaches of AML/ CFT/ PF obligations by registered CSPs and their senior management |
To impose criminal liability on registered CSPs and their senior management for breaches of AML/ CFT/ PF obligations.
A registered CSP which breaches the AML/ CFT/ PF obligations is guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 for each breach.
The senior management of a registered CSP who fails to ensure that the registered CSP complies with its AML/ CFT/ PF obligations is also guilty of an offence and liable on conviction to a fine not exceeding $100,000 for each breach.
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The changes will ensure that the maximum fines for breaches of AML/ CFT/ PF obligations by registered CSPs and their senior management are commensurate with the risks of money laundering, the financing of proliferation of weapons of mass destruction and terrorism financing in Singapore. In addition, the new penalties are consistent with those for other designated non-financial businesses and professionals in Singapore. |
| Prohibit persons from acting as nominee directors by way of business unless the appointments are arranged by registered CSPs and they have been assessed as fit and proper by the registered CSPs |
A person must not by way of business, act as a nominee director of a company, unless the appointment of the person as a nominee director of the company is arranged by a registered CSP. A person who breaches this requirement is guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000.
A registered CSP must not arrange for a person to act as a nominee director of a company unless he is satisfied that the person is fit and proper. In determining whether the person is a fit and proper person, the registered CSP must take reasonable steps to satisfy himself that the person is not disqualified from acting as a director of a company under any written law, and consider other factors prescribed in subsidiary legislation. A registered CSP which breaches this requirement is guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000.
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The changes aim to prevent misuse of nominee directorship arrangements by way of business, in creating shell companies to facilitate money laundering. This situation is observed to be largely created by CSPs who arrange for unqualified individuals to act as nominee directors for their customers. |
| Require nominee directors’ and nominee shareholders’ nominee status and the identities of their nominators to be disclosed to ACRA |
To require companies and foreign companies to file all information kept in their registers of nominee directors and nominee shareholders with ACRA, and for ACRA to maintain such information.
Upon disclosure to ACRA, the nominee status of the director and shareholder will be made publicly available, including adding the nominee status to business profile extractions.
Only public agencies may access the full information maintained by ACRA for the administration or enforcement of any written law.
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The changes will further mitigate money-laundering risks by enhancing the transparency of nominee arrangements, as it can trigger additional scrutiny and customer due diligence by AML-obligated entities if a company or foreign company has nominee directors or shareholders.
It will also ensure Singapore’s continued compliance with the FATF’s update of its standards on beneficial ownership in March 2022, in which nominee directors and nominee shareholders are required to disclose the identity of their nominators to the Registrar, and to publicly disclose their nominee status. |
| Increase fines pertaining to the register of registrable controllers, register of nominee directors and register of nominee shareholders |
To increase the maximum fines from $5,000 to $25,000, for offences pertaining to:
- The register of registrable controllers, the register of nominee directors and the register of nominee shareholders for companies; and
- The register of registrable controllers for limited liability partnerships.
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The changes will ensure the accuracy of information maintained in entities’ register of registrable controllers, register of nominee directors and register of nominee shareholders and that the accompanying fines are appropriately dissuasive and in line with the FATF’s recommendations. |