Monetary Authority of Singapore

How much do APAC’s regulators earn?

Regulators’ salaries across Asia Pacific vary enormously:some supervisors earn fortunes and others hit the pay scale at the average to low end.APAC REGULATORs - SALARIES

Some governments believe that paying politicians and civil servants high salaries should reduce the likelihood of them accepting a bribe, offered in cash or disguised as a gift. Others argue that financial regulators will be less likely to jump ship and work for a bank if they are paid competitively by the government. Some countries pay their banking regulators on the same modest scale as other government employees , pitting them against some of the highest paid people in the country – bankers.

Last April, we found out how much the head of the Hong Kong Monetary Authority brings home; Norman Chan Tak-lam was set to earn HKD$9.41m(USD1.2m), making him the highest paid central bank chief in the world.  As the HKMA is also the banking regulator, this makes Chan Tak-lam the biggest earning regulator in the world. Chan Tak-lam’s counterpart in Beijing, Shang Fulin, the head of China Banking Regulatory Commission, earns an estimated  CNY11,271 (USD1,800) per month.

The accompanying infographic details more of APAC banking regulators’ earnings.

Comparing regulators salaries with those of bankers reveals a stark difference. Since the global financial crisis took hold in 2008, we have seen a distinct change of attitude towards financial institutions. Blatant rule breaking by banks – whether money laundering, sanctions busting or tax evasion – is being punished in high-profile cases as regulators finally start to show their teeth. However, the impact on the individuals responsible have been unremarkable; a move to a less high-profile role in the bank, or early retirement as opposed to job loss or, as some have called for, criminal prosecution.

Rather than going after the bankers who allowed criminality to go unchecked at banks, or those who made good from the financial crisis, there is an element of maintaining the status quo vis a vis bankers’ salaries that is out of step with the movement to make change for the better in the financial sector.

In the post global financial crisis and post public bailout economy, can banks justify paying million dollar bonuses?

In February 2015, Ross McEwen, the head of RBS, went on record to defend bonuses for bankers in spite of government bailouts and losses:

“I need to be fair paying for our people so I can actually keep them onboard.”

Although McEwen has opted to hand back his personal GBP1m (USD1.5m) share award to the bank he will still take home an expected GBP2.7m (USD4m) in 2015. Peter Sands, the outgoing boss of Standard Chartered also waived his bonus in 2015.

Looking at Asia Pacific, four of China’s largest five banks made the Banker’s Almanac list of top ten biggest financial institutions. This includes Industrial and Commercial Bank of China, China Construction Bank Corporation, Agricultural Bank of China Limited and Bank of China. China Development Bank Corporation languished at no. 21 on the list.

“According to the half-year annual reports of the listed commercial banks, the average annual payment before deductions for the chairmen of the five biggest Chinese commercial banks was around 2 million yuan ($325,600).”Source:The Global Times 2014.

Piyush Gupta, CEO of DBS bank, Singapore’s largest, made SGD9.2m (USD 6.6m)
The CEOs of United Overseas Bank and Oversea Chinese Banking Corporation were not far behind.

Chief regulators salaries fall far short of those earned by their peers at regulated entities.
It’s unlikely they will ever be measured on the same scale. Regulators, in an ideal world, would be motivated by doing the right thing for the right reasons. That is certainly the message that some regulators are putting across. But banking is all about money, and the more you earn, the higher your status.

First published on the International Compliance Association blog in March 2015. 


Singapore: MAS proposes new CDD rules for cross border tx

The Monetary Authority of Singapore has proposed a series of new measures designed to re-enforce the national anti-money laundering and counter-terrorist financing framework (AML/CTF).FCA - Singapore

Proposed amendments include:

a) requiring financial institutions to perform an ML/TF risk assessment at the wider institutional level,  in addition to assessing the ML/TF risk of individual customers;

b) elaborating on steps to be taken by FIs to identify and verify beneficial ownership of non-individual customers, such as companies and trusts;

c) formalising the need for FIs to screen customers and their connected parties;

d) catering for a risk-based approach for certain categories of Politically Exposed Persons; and

e) putting in place additional requirements for cross-border wire transfers exceeding SGD1,500 (USD1200) such as customer due diligence on occasional transactions and minimum information fields in the message or payment instructions.

Institutions have until August 14 to submit comments on the consultation paper.

Source: MAS

Insider trading: MAS takes action against former Maybank employee for insider trading

SINGAPORE — The Monetary Authority of Singapore (MAS) has taken civil penalty action against a man for insider trading.

Koh Huat Heng was a relationship manager and a team head in the Affluent Banking Unit of Malayan Banking Singapore branch (Maybank).

On June 18 last year, Koh purchased 140,000 shares in SGX-listed Sin Heng Machinery, while he was holding on to non-public and price-sensitive information concerning Sin Heng’s planned rights issue.

The company subsequently announced a rights issue of up to 114.8 million shares at 16 cents each on June 23 last year.

Koh has paid MAS a civil penalty of S$50,000 for contravening the Securities & Futures Act.

He is also prohibited from providing any financial advisory service or becoming a substantial shareholder of a licensed financial advisor for three years.

MAS Assistant Managing Director (Capital Markets), Mr Lee Boon Ngiap said: “MAS expects a person who has been appointed as a representative of a financial advisor to act honestly and with integrity, especially in relation to the information that he obtains in the course of his work. To maintain the public’s confidence in our financial services sector, we will take firm action against any representative who fails to do so.”

A civil penalty action is not a criminal action and does not attract criminal sanctions. The regime, which became operational in 2004, aims to provide a nuanced approach to combat market misconduct. CHANNEL NEWSASIA



Source: TodayOnline

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Pakistan identifies 26 tax crimes as ML predicate offences

FCA - Pakistan flagThe government of Pakistan is preparing a list of serious tax crimes to be declared as predicate offences under the Anti-Money Laundering Act 2010. A total of 26 offences have been outlined so far, connected to sales tax, income tax and federal excise duty. Making tax crimes predicate offences to money laundering is one of the Financial Action Task Force‘s 40 Recommendations as of 2012.

As of July 1 2013, tax crimes are predicate offences to money laundering in Singapore. The Monetary Authority of Singapore guided financial institutions to  ‘develop, implement and enforce internal policies, controls and procedures that effectively detect, and deter the laundering of proceeds from wilful or fraudulent tax evasion through the financial system.’

The new guidance placed enhanced due diligence requirements on all ‘clients assessed to present high risk of wilful or fraudulent tax evasion.’

In March 2013, the Private Banking Industry Group’s issued the Industry Sound Practices (see Addendum 1, p 29), to ‘safeguard the industry from being used as a platform to harbour proceeds from serious tax crimes, or as a conduit to disguise the flow of such funds.’

Among the firm’s responsibilities is to communicate that clients are responsible for their own tax obligations and assess the bona fides of clients, carefully evaluating the tax-related risks both when taking on a client and via continuous monitoring

Red flags for when to apply EDD to a client and account include:

  • Client requests for holdmail services without satisfactory reasons. Clients can ask a bank to receive correspondence relating to their account. The mail is held for them until they return to the jurisdiction. The service allows a level of privacy or secrecy which the Singapore governmnet n
  • Use of complex structures
  • Non-face-to-face business relationships
  • Negative tax-related reports from media or other credible information sources on the client or on client’s jurisdiction of domicile or tax residence
  • Any additional parameters that a Covered Entity considers pertinent for conducting its risk assessments and due diligence checks.

The Industry Sound Practices also includes a ‘non-exhaustive’ five step process for EDD, including screening adverse or negative news, questioning the source of funds, using information from other financial institutions where legally possible, identifying the beneficial owners.

This guidance was targeted to the private banking sector, some of whose clients have been used to evading taxes and may be less inclined to reveal more details about the source of their wealth as private banking is notoriously discreet and protective of its wealthy benefactors. There was some concern that clients who had traditionally banking in Singapore may begin to move funds to jurisdictions with less rigorous counter-tax crime regimes.

If any readers have seen changes within Singapore, or heard of a client exodus, do please drop me a line.



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Bitcoin: MAS advises caution on transactions involving Bitcoins

SINGAPORE: The Monetary Authority of Singapore (MAS) has advised consumers and businesses to be cautious with transactions involving Bitcoins, as virtual currencies are unregulated and FCA - Bitcoinconsumers may not have legal recourse should there be problems.

The warning comes as Bitcoin changing machines make their debut in Singapore. MAS referred to them as vending machines as they accept cash for Bitcoins but do not allow people to convert their Bitcoins into cash.

“Virtual currencies, including Bitcoin, are not legal tender and are not recognised by MAS as an official medium of exchange or as a form of securities. MAS does not regulate Bitcoin, including its purchase, sale or use, whether online or via other means such as physical vending machines,” the central bank said in a statement.

MAS also warned that the value of a virtual currency such as Bitcoin can fluctuate greatly within a short period of time.

“Consumers and businesses may suffer monetary losses as a result of the volatile prices. They may also be unable to obtain a refund of their monies should such a scheme cease to operate, and may have no legal recourse as Bitcoin is not issued by any identifiable organisation,” MAS said.

MAS added it closely monitors international developments, and it will consider the need to introduce regulations to address risks associated with virtual currencies such as money-laundering and terrorist-financing.

– CNA/nd

Source: Channel News Asia

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Singapore Launches Anti-Money Laundering Risk Assessment


singapore (Photo credit: Kenny Teo (zoompict))

A joint Steering Committee in Singapore – led by the Monetary Authority of Singapore, the Ministry of Home Affairs and the Ministry of Finance – has launched a comprehensive assessment of money laundering (ML) and terrorist financing (TF) risks in the country.

Full story at


Singapore’s non-bank FIs covered by new IT risk guidance

Ma huang tang

Ma huang tang (Photo credit: SuperFantastic)

Heads up for non-banking financial institutions including m-payment, online payment and prepaid card firms, Singapore‘s new Technology Risk Management Guidelines (TRMG) include you.  They are not legally binding, but how far firms observe the spirit of the guidelines will be considered during a regulatory risk assessment.
The guidance places the onus on FIs to report IT system outages to the MAS, which requires firms to enhance existing systems and implement new frameworks to allow swift reporting of technological failures to the Monetary Authority of Singapore (MAS).  Firms must report all system outages to MAS as soon as possible, or not more then one hour after the discovery of the outage.
According to the Notice on TRM, which outlines the relevant legal requirements,  the guidance covers all financial institutions, holders of remittance licences and all operators and settlement institutions of designated payment systems, which includes many providers of new payment products and services (NPPS).
Who is responsible for what?
Board directors and senior management are called out immediately in the guidance, which pinpoints their responsibility for implementing and maintaining tech frameworks, based upon the risks faced, to achieve security, reliability, resiliency and recoverability.
Policies, standards and procedures should be updated regularly to reflect changes in operations and new technology, including updating compliance processes to reflect developments.
Employee, vendor and contractor screening processes should be in place to identify any risks from the people you work with.
All staff, contractors and vendors should undergo IT security awareness training annually, at a minimum.
The guidance offers some very useful pointers on how to manage the risks – from identification to treatment, monitoring and reporting to MAS. THe regulator has also produced a compliance checklist, to be completed annually by senior managers with oversight of IT systems.