Some of the biggest local and international banks in Singapore are becoming embroiled in one of the city-state’s largest money laundering cases.
(Bloomberg) — Some of the biggest local and international banks in Singapore are becoming embroiled in one of the city-state’s largest money laundering cases.
DBS Group Holdings Ltd, the country’s largest bank, and Bank of Singapore Ltd., the private-banking arm of Oversea-Chinese Banking Corp., are both creditors to investment firms linked to individuals arrested and charged earlier this month in a case involving over S$1 billion ($740 million) of assets, according to business filings seen by Bloomberg News. One of the accused also tried to cheat Standard Chartered Plc. with fake documents, according to a court hearing in Singapore on Wednesday.
The banks join a list of financial institutions, including Malaysia’s CIMB Bank Bhd., Citigroup Inc.’s local subsidiary and Deutsche Bank AG to be linked to the suspects in the alleged money laundering ring. Beyond the banks, property agents, precious metals dealers and golf clubs in the city have also been drawn into the scandal. This has raised questions about guardrails against illicit money flowing into the financial hub.
Before this case, Singapore was rocked by scandals involving huge money flows in Malaysia’s state fund 1MDB and German firm Wirecard AG. These blow-ups have led to financiers being banned, people jailed or banks slapped with fines for inadequate controls.
Singapore has been moving to try to curb illicit flows as the country gains in stature as a key financial and wealth hub. In May, Parliament passed a bill that paved the way for banks to share information on potentially risky clients.
In the filing, DBS registered four charges — generally referring to a form of security interest usually taken by a lender to secure repayment of a loan — on Aug. 18, 2021 to Aiqinhai Investment Pte. The firm’s director and sole shareholder Su Haijin is among the 10 individuals who have been indicted in a Singapore court for offenses including money laundering and forgery.
Bank of Singapore registered a charge on Jan. 7, 2022 for Xinbao Investment Holdings Pte. One of the firm’s two directors is Su Baolin, who was also among the individuals charged.
A spokesperson for DBS said the lender will continue its work “to make Singapore a place where criminals cannot find harbor,” though did not comment on specific names. OCBC declined to comment. Standard Chartered, which Su Baolin allegedly tried to cheat, didn’t immediately respond to a request for comment.
Su Haijin and Su Baolin are both in remand. Su Baolin’s lawyers declined to comment while Su Haijin’s attorneys did not immediately respond to a request for comment.
Both the investment firms linked to DBS and Bank of Singapore have listed office addresses in Singapore’s business district, while the two accused directors have upscale residential addresses. The banks’ facilities are secured against “all monies” at the companies, according to the filing, which did not specify the size of the exposure.
Prosecutors have said they are seeking documents from at least 10 financial institutions in relation to the case, although they were not named.
The Monetary Authority of Singapore, when asked by Bloomberg News for comment, referred to its earlier statement where it said the regulator is undertaking supervisory engagements with financial firms where potentially tainted funds have been identified, and will take “firm action” against those found to have breached anti-money laundering and related rules. The police did not immediately respond to a request for comment.
Some of the 10 people arrested were charged with more offenses on Wednesday in court, where hearings are ongoing throughout the day for all of them.
The additional charges are related to money laundering and forgery. Prosecutors said the accused are wealthy and have overseas assets.
–With assistance from Andrea Tan.
(Updates with court proceedings throughout)
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.