More Responsibilities for Housing Developers to Prevent Money Laundering
Singapore’s housing developers will have new rules, duties and responsibilities under a Bill which was passed in Parliament recently. These and other proposed changes to the Developers (Anti-Money Laundering and Terrorism Financing) Bill are part of Singapore’s efforts to remain in line with the international standards for anti-money laundering and terrorism financing in the real estate sector.
Developers will now need to perform due diligence checks on every purchaser, with the enforcement of these new rules. They will also be required to keep proper records relating to these checks. Any reports found with suspicious activity or transactions must be reported to the Suspicious Transaction Reporting Officers. Processes must also be established to help mitigate money laundering and terrorism financing risks involved. In addition, all employees must now be trained in accordance with the requirements of these new standards.
Individual Convicted will be Barred from Holding Housing Developers License
Any individual who has previously been convicted for money laundering and terrorism financing will now be barred from holding a housing developers license. They will also be disqualified from holding responsible positions at development firms. Any record of diligence checks by housing developers must also be kept for a minimum of 5 years once the transaction has been completed. This 5 year period was consistent with international recommendations and legislations in other sectors, including for financial institutions.
Amendments will be made to the Housing Developers (Control and Licensing) Act, and the Sale of Commercial Properties Act to incorporate these new changes. In addition, the Controller of Housing will be given enforcement powers with these new changes, to help ensure that compliance with these new provisions are administers to the housing developers accordingly.
Singapore’s Ministry for National Development recognized and acknowledge the concerns among existing developers. One of these concerns was whether the increased compliance cost would be inadvertently passed on to consumers. The ministry has assured that these concerns have been taken into account when tabling the new Bill, and the ministry has made every effort to maintain a balance between meeting compliance requirements set by the Financial Action Task Force (FATF), and ensuring that the burden experienced by developers will not be excessive. The ministry will continue its efforts to engage with developers in the industry to acquire more feedback as it works on finalizing the finer implementation details for the Bill.