Singapore is taking strong steps to protect its reputation as a trusted global financial centre. A new proposal aims to ban directors convicted of money laundering from becoming company directors. This move follows a massive S$3 billion money laundering case that shocked the nation in 2023.
The Ministry of Finance (MOF) and the Accounting and Corporate Regulatory Authority (Acra) released a joint statement on July 14. They are now asking for public feedback on a range of changes to corporate and accounting laws. The goal is to tighten control, protect shareholders, and reduce risks of illegal activities linked to companies.
Under the current Companies Act 1967, there is no rule that stops someone found guilty of money laundering from acting as a company director. The proposed changes would add a new ground to disqualify such individuals. This aims to close existing legal gaps and strengthen Singapore’s fight against financial crime.
Proposed Law Targeting Dirty Money Directors
The government is looking to change several key laws. These include the Companies Act 1967, the Accountants Act 2004, and other acts related to partnerships and accounting. The proposed rules are designed to reduce the misuse of companies for illegal purposes, especially money laundering.
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One major change is the shortened timeline for striking off inactive companies from the Register of Companies. This means that companies that are no longer active could be removed faster, making it harder for bad actors to use them for criminal activities.
Currently, companies applying to be removed from the register must wait 90 days to allow for public objections. The proposed change would cut this to 60 days. For companies being removed by the Registrar, the new rules would allow 75 days in total – 15 days for the company to respond, and 60 days for public objections.
This updated process is meant to speed things up without affecting the public’s right to raise concerns. Faster removals will reduce the risk of inactive companies being used for laundering money or hiding illegal funds.
Stronger Oversight and Less Red Tape for Businesses
The changes also aim to improve transparency and give regulators more tools to keep the financial system clean. One of the proposed updates will allow Acra to share audit-related information with overseas audit regulators. This is important in a globalized economy, where companies and money often move across borders.
The definition of financial crimes in the Accountants Act 2004 will also be updated. This includes not only money laundering and terrorism financing but also the financing of weapons of mass destruction. These changes are in line with international standards from the Financial Action Task Force (FATF).
Alongside stronger rules, the government is also looking to reduce the burden on businesses. One suggestion is to remove the requirement for public limited companies with share capital to hold a statutory meeting and prepare a statutory report. This will give businesses more flexibility while still protecting the rights of shareholders.
All these proposed changes are part of a wider review of corporate laws in Singapore. The government is inviting the public to give feedback until July 31. Comments can be submitted through the Reach public consultation portal using the FormSG link.
The proposals come in response to the 2023 money laundering case, which saw penalties of over S$27 million issued to nine financial institutions. These included major banks that were found to have broken anti-money laundering rules. The scandal raised questions about how criminals were able to misuse Singapore’s corporate system and financial services.
By proposing stricter rules, the authorities aim to send a clear message: Singapore will not tolerate financial crimes. The suggested reforms are a step toward making sure that companies are not used as tools for illegal activities, and that directors are held to the highest standards of conduct.