MAS takes financial institutions to task for anti-money laundering breaches

14 July 2025 | Asia | Articles

In a span of one week, the MAS has imposed composition penalties totalling more than S$28 million on multiple financial institutions, including payment service providers. Alongside this, the regulator has also issued prohibition orders and reprimands on individuals – for breaches of its Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) requirements discovered during routine inspections and recent case examinations. This activity has acted as a clear warning to firms to ensure their AML compliance frameworks are up to scratch.

Composition penalties for major money laundering case

On 4 July 2025, the MAS imposed composition penalties totalling S$27.45 million on nine financial institutions (FIs) for breaches of its AML/CFT requirements, directly relating to the S$3 billion money laundering (ML) case uncovered in August 2023.

These FIs were found to have shortcomings in customer risk assessment, corroborating source of wealth of high-risk customers, transaction monitoring, and following up on Suspicious Transaction Reports.

The MAS also issued prohibition orders to four individuals from BOIPL and issued a number of public and private reprimands to individuals from TTCSPL and UOB.

Composiiton penalties against Major Payment Institutions

Prior to this, on 27 June 2025, the MAS informed the public that it has imposed composition penalties on the following five Major Payment Institutions (MPIs) that provide cross-border money transfer service for breaches of its AML/CFT requirements set out in the MAS Notice PSN01. The breaches relate to weaknesses in customer due diligence, screening, and controls for wire transfers.

We understand that all these FIs have established plans to remediate their weaknesses in their ML/FT controls. The MAS is working closely with them to promote more consistent implementation of AML/CFT measures. The regulator will also be publishing an information paper to set out common issues noted, its supervisory expectations, and areas for improvement uncovered from its recent examinations.

Singapore’s zero tolerance for ML risk

Singapore Inc has taken a hit to its otherwise stellar reputation following the S$3 billion ML case of August 2023, which is the biggest ML case in Singapore and amongst the biggest globally. Following this, Singapore set up an inter-ministerial committee to enhance its framework to combat ML whilst remaining welcoming of most businesses which are law-abiding and legitimate.

A couple of the notable outcomes of this review: strengthening AML/CFT standards for gatekeepers and continuously reviewing penalty frameworks to ensure that they remain dissuasive.

We are increasingly seeing the MAS taking an even more cautious approach to its gatekeeping processes. Firms, particularly those directly handling customers’ moneys and assets, are being scrutinized to ensure that their AML/CFT procedures and controls are second to none. It’s apparent that the MAS has raised the bar here.

We also expect routine examinations and inspections to continue. It’s likely that FIs with material weaknesses will be heavily penalised, given what we’ve seen in 2024 and 2025, in the run up to the FATF’s visit to Singapore.

Whilst the MAS is working hard to safeguard its FIs and their systems from being used as a conduit for ML, it’s clear that more fines, prohibition orders, reprimands, and warnings are likely to be issued. FIs should not rest on their laurels and hope that the MAS does not come knocking on their doors. Rather, they should revisit their ML/FT processes controls now to ensure that they are in line with MAS’ expectations.

How can Bovill Newgate help you meet MAS’ AML/CFT requirements?

For over ten years, our Singapore team have been actively supporting clients by:

• developing new AML/CFT policies and procedures or reviewing and enhancing existing frameworks
• providing appropriate and actionable advice (as part of our ongoing compliance support services) to help put in place appropriate AML/CFT control measures and deal with specific situations
• carrying out periodic AML/CFT internal audits.

Get in touch if you want to discuss any of our AML/CFT services.