MAS and ABS Guidelines

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Which organization issued the Guidelines on Anti-Money Laundering and Countering the Financing of Terrorism?

Association of Banks in Singapore (ABS)

Which banks are required to comply with the ABS Guidelines?

A+C

What is the purpose of the ABS Guidelines?

To supplement the MAS Notice and Guidelines

Which of the following is NOT one of the stages of money laundering?

Extraction Signup and view all the answers

What is the definition of money laundering?

The process criminals use to try to conceal the true origin and ownership of the proceeds of drug trafficking and other serious crimes Signup and view all the answers

Which institutions are at a higher risk of facilitating the layering stage of money laundering?

Wire transfer services Signup and view all the answers

What is the purpose of the integration stage of money laundering?

To allow the laundered monies to re-enter the economy and appear as if it is from legitimate sources Signup and view all the answers

Which act defines distinct predicate offences related to corruption, drug trafficking, and other serious crimes?

Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (Cap 65A) Signup and view all the answers

What is the purpose of Customer Due Diligence?

To prevent money laundering and financing of terrorism Signup and view all the answers

What is the responsibility of the Ordering Institution in a wire transfer?

To verify the identity of the beneficiary Signup and view all the answers

Which ABS guideline provides information on the methods and stages of money laundering?

ABS Anti-Money Laundering Principles for Trade Finance (2015) Signup and view all the answers

Which of the following is NOT a purpose of the ABS Guidelines?

To comply with the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act Signup and view all the answers

Which international organization's recommendations are considered in the ABS Guidelines?

The Financial Action Task Force (FATF) Signup and view all the answers

What is the purpose of the Suspicious Transaction Reports (STRs)?

To report money laundering cases to the Commercial Affairs Department Signup and view all the answers

Which institutions are at a higher risk of facilitating the placement stage of money laundering?

Retail banking institutions Signup and view all the answers

What is the definition of terrorist financing?

The solicitation, collection, or provision of funds with the intention to support terrorist acts or organizations Signup and view all the answers

What is the role of private banks and investment banks in the integration stage of money laundering?

To facilitate the re-entry of laundered money into the economy Signup and view all the answers

Which act defines the distinct predicate offenses related to corruption, drug trafficking, and other serious crimes?

The Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) Signup and view all the answers

What is the purpose of the Terrorism (Suppression of Financing) Act (TSOFA)?

To suppress the financing of terrorism Signup and view all the answers

What is the responsibility of the Ordering Institution in a wire transfer?

To initiate the transfer of funds Signup and view all the answers

What is the purpose of the ABS Anti-Money Laundering Principles for Trade Finance?

To establish trade finance facilities and transactions undertaken Signup and view all the answers

Which of the following factors should a bank consider when conducting an enterprise-wide risk assessment in relation to its customers?

All of the above Signup and view all the answers

When assessing ML/TF risks of countries and jurisdictions, which criteria may be considered?

Evidence of adverse news or relevant public criticism of a country or jurisdiction Signup and view all the answers

Which organization identifies countries or jurisdictions with relatively higher levels of corruption, organised crime, or inadequate AML/CFT measures?

The Financial Action Task Force (FATF) Signup and view all the answers

Which of the following is NOT a chapter in the Monetary Authority of Singapore's Guidelines on Prevention of Money Laundering and Countering the Financing of Terrorism?

Chapter 4 - New Products, Practices and Technologies Signup and view all the answers

What is the purpose of Appendix A in the Monetary Authority of Singapore's Guidelines on Prevention of Money Laundering and Countering the Financing of Terrorism?

To provide examples of Customer Due Diligence Information for Customers Signup and view all the answers

Which of the following is NOT a topic covered in the Monetary Authority of Singapore's Guidelines on Prevention of Money Laundering and Countering the Financing of Terrorism?

Proliferation Financing Signup and view all the answers

Which legislation is Singapore's primary legislation to combat money laundering?

Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act Signup and view all the answers

What are the three stages of money laundering?

Placement, Layering, Integration Signup and view all the answers

What is the purpose of the Terrorism (Suppression of Financing) Act (TSOFA)?

To combat money laundering and terrorist financing Signup and view all the answers

Who is ultimately responsible for ensuring compliance with anti-money laundering and countering the financing of terrorism (AML/CFT) laws?

The board of directors and senior management of a bank Signup and view all the answers

Which of the following is NOT considered in the risk assessment on an enterprise-wide level?

ML/TF risks presented by an individual customer Signup and view all the answers

In which country or jurisdiction should a bank incorporated in Singapore consider the ML/TF risks of its branches and subsidiaries?

All of the above Signup and view all the answers

Which of the following authorities are considered as Other Relevant Authorities in Singapore?

All of the above Signup and view all the answers

Which line of defence in a bank's AML/CFT risk management framework is responsible for identifying, assessing, and controlling ML/TF risks of their business?

Front office functions Signup and view all the answers

Which function within a bank's AML/CFT risk management framework is responsible for ongoing monitoring of the bank's fulfilment of all AML/CFT duties?

AML/CFT compliance function Signup and view all the answers

Which function within a bank's AML/CFT risk management framework is responsible for independently evaluating the effectiveness of the bank's compliance with AML/CFT policies, procedures, and controls?

Internal audit function Signup and view all the answers

What is the role of the support functions in a bank's AML/CFT risk management framework?

To provide resources and assistance Signup and view all the answers

According to the text, what information should the board and senior management receive to form an accurate picture of ML/TF risks?

Information on emerging or new ML/TF risks Signup and view all the answers

According to the text, what information should the board and senior management receive to assess the adequacy and effectiveness of the bank's AML/CFT controls?

Information on the bank's AML/CFT controls Signup and view all the answers

According to the text, what information should the board and senior management receive regarding legal and regulatory developments?

Information on legal and regulatory developments Signup and view all the answers

According to the text, what should the board and senior management ensure regarding processes that impact the bank's ability to address and control ML/TF risks?

Processes to escalate important decisions Signup and view all the answers

Which legislation is the primary legislation in Singapore to combat money laundering?

Monetary Authority of Singapore Act 1970 Signup and view all the answers

According to MAS Notice 626, which organizations are required to comply with this Notice?

All banks in Singapore Signup and view all the answers

According to MAS Notice 626 (Amendment) 2022, what information should a bank obtain to identify each natural person who acts or is appointed to act on behalf of a customer?

Full name, unique identification number, residential address, date of birth, and nationality. Signup and view all the answers

What is the purpose of verifying the identity of a customer's natural person appointed to act on their behalf, according to MAS Notice 626 (Amendment) 2022?

To ensure the due authority of each natural person. Signup and view all the answers

What type of data, documents, or information should a bank use to verify the identity of a customer's natural person appointed to act on their behalf, according to MAS Notice 626 (Amendment) 2022?

Reliable and independent source data, documents, or information. Signup and view all the answers

Which of the following is NOT a principle that banks should adhere to in the conduct of their operations and business activities?

Facilitate money laundering or terrorism financing Signup and view all the answers

Which of the following is NOT a step that a bank should take to identify, assess, and understand its money laundering and terrorism financing risks?

Provide risk assessment information to the Authority Signup and view all the answers

Which of the following is NOT a requirement for banks to effectively manage and mitigate the risks identified in relation to money laundering and terrorism financing?

Ignore risk assessment and guidance from the Authority Signup and view all the answers

Which of the following is NOT a requirement for banks to identify and assess money laundering and terrorism financing risks in relation to new products, practices, and technologies?

Ignore the risks associated with new or developing technologies Signup and view all the answers

Which one of the following is a definition of 'beneficial owner' according to the text?

The natural person who ultimately owns or controls the customer Signup and view all the answers

Which one of the following is a definition of 'business relations' according to the text?

The opening or maintenance of an account by the bank in the name of a person Signup and view all the answers

Which one of the following is a definition of 'cash' according to the text?

Currency notes and coins which are legal tender and circulate as money Signup and view all the answers

Which one of the following is a definition of 'connected party' according to the text?

In relation to a legal person (other than a partnership), any director or any natural person having executive authority Signup and view all the answers

Which of the following transactions would require a bank to perform customer due diligence measures?

An international wire transfer of S$1,500 for a customer who has not established business relations with the bank Signup and view all the answers

Which of the following information is NOT required to be obtained by a bank for customer identification?

Unique identification number Signup and view all the answers

When would a bank be allowed to obtain the date of birth and nationality of a connected party instead of their unique identification number?

When the bank is unable to obtain the unique identification number after taking reasonable measures Signup and view all the answers

What should a bank do if it suspects that two or more transactions are related, linked, or the result of a deliberate restructuring to evade AML/CFT measures?

Aggregate the values of the transactions and treat them as a single transaction Signup and view all the answers

Which of the following refers to wire transfers between institutions in different countries or jurisdictions?

Cross-border wire transfer Signup and view all the answers

What is the definition of 'Custodian wallet service'?

The service of safekeeping and administering digital payment tokens Signup and view all the answers

What is the definition of 'Digital token'?

A digital representation of a capital markets product or a digital payment token that can be transferred, stored, or traded electronically Signup and view all the answers

What is the definition of 'Payment service transaction'?

Any transaction accepted, processed, or executed by a bank in the course of providing a specified payment service Signup and view all the answers

Which of the following factors should a bank consider when conducting an enterprise-wide risk assessment?

Target customer markets and segments Signup and view all the answers

What criteria may be considered when assessing ML/TF risks of countries and jurisdictions?

Evidence of adverse news or relevant public criticism of a country or jurisdiction Signup and view all the answers

Which organization identifies countries or jurisdictions with relatively higher levels of corruption, organized crime, or inadequate AML/CFT measures?

Financial Action Task Force (FATF) Signup and view all the answers

Which of the following is NOT one of the stages in the process of money laundering according to the text?

Extraction Signup and view all the answers

What is the primary legislation in Singapore to combat money laundering?

Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act Signup and view all the answers

What is the act of providing funds for acts of terrorism called?

Terrorism financing Signup and view all the answers

Who is ultimately responsible for ensuring compliance with anti-money laundering and countering the financing of terrorism laws in a bank?

Board of directors and senior management Signup and view all the answers

Which of the following is NOT a factor that the Authority will consider when determining the location of relationship management in a bank?

The nationality of the bank employee or officer Signup and view all the answers

In the context of the Notice, what does 'officer' refer to?

A bank's board of directors and senior management Signup and view all the answers

Which one of the following is NOT an example of a legal arrangement according to the Notice?

Fideicomiso Signup and view all the answers

Which one of the following is NOT an example of a legal person according to the Notice?

Anstalt Signup and view all the answers

Which one of the following is NOT a responsibility of the second line of defence in a bank's AML/CFT risk management framework?

Helping to mitigate ML/TF risks Signup and view all the answers

What should be clearly specified in writing and communicated to all relevant employees and officers in the business units as part of the first line of defence in a bank's AML/CFT risk management framework?

The bank's policies, procedures, and controls on AML/CFT Signup and view all the answers

What is the role of the bank's internal audit function in a bank's AML/CFT risk management framework?

Independently evaluating the effectiveness of the bank's compliance with AML/CFT policies, procedures, and controls Signup and view all the answers

What is the responsibility of the bank's board of directors and senior management in a bank's AML/CFT risk management framework?

Ensuring robust processes and adequate risk mitigating measures are in place Signup and view all the answers

According to MAS Notice 626, which of the following is NOT a responsibility of the board and senior management?

Receiving information on ML/TF risks Signup and view all the answers

According to the text, which of the following is NOT considered a customer for the purposes of MAS Notice 626?

The merchant for whom the bank opens or maintains an account Signup and view all the answers

According to MAS Notice 626, when is a bank exempted from making inquiries about the existence of underlying investors (i.e. beneficial owners)?

When the customer falls within a specific paragraph of the Notice Signup and view all the answers

According to the text, which of the following is NOT a customer for the purposes of MAS Notice 626?

The natural person with executive authority in a company Signup and view all the answers

Which of the following information should a bank obtain to identify each natural person appointed to act on behalf of a customer?

Full name, residential address, and unique identification number Signup and view all the answers

What should a bank do to verify the identity of each natural person appointed to act on behalf of a customer?

Obtain reliable, independent source data, documents, or information Signup and view all the answers

When should a bank verify the due authority of each natural person appointed to act on behalf of a customer?

Before establishing business relations with the customer Signup and view all the answers

According to MAS Notice 626 (Amendment) 2022, what is the definition of 'cash'?

Currency notes and coins which are legal tender and circulate as money in the country or jurisdiction of issue Signup and view all the answers

According to the text, what is the definition of 'beneficial owner' in relation to a customer of a bank?

All of the above Signup and view all the answers

According to the text, what is the definition of 'business relations'?

The opening or maintenance of an account by the bank in the name of a person or the provision of financial advice by the bank to a person Signup and view all the answers

According to the text, what is the definition of 'connected party' in relation to a legal person?

All of the above Signup and view all the answers

Which one of the following is NOT a requirement for banks to effectively manage and mitigate the risks identified in relation to money laundering and terrorism financing?

Ensure that the performance of measures or enhanced measures addresses the risk assessment and guidance from the Authority Signup and view all the answers

Which of the following is NOT a factor that the Authority will consider when determining the location of relationship management in a bank?

The bank's financial performance Signup and view all the answers

Which one of the following is a definition of 'connected party' according to the text?

A bank's customers, natural persons appointed to act on the customer's behalf, and beneficial owners of the customer Signup and view all the answers

Which one of the following is a definition of 'business relations' according to the text?

A bank's business relations and transactions that are or may be connected with money laundering or terrorism financing Signup and view all the answers

Which of the following is NOT a circumstance in which a bank is required to perform customer due diligence measures according to MAS Notice 626?

When the bank has doubts about the veracity or adequacy of any information previously obtained Signup and view all the answers

Which of the following information is NOT required to be obtained by a bank for customer identification according to MAS Notice 626?

Residential address Signup and view all the answers

When does a bank treat two or more transactions as a single transaction and aggregate their values according to MAS Notice 626?

When the bank suspects that the transactions are related, linked or the result of a deliberate restructuring Signup and view all the answers

Which of the following is required to be obtained by a bank for customer identification when the customer is a legal person or legal arrangement according to MAS Notice 626?

Connected parties' full names Signup and view all the answers

According to MAS Notice 626 (Amendment) 2022, what is the definition of 'Customer'?

A person who establishes business relations or undertakes transactions with a bank Signup and view all the answers

What is the meaning of 'Digital token' according to the text?

A digital payment token or digital CMP token Signup and view all the answers

What does 'Cross-border wire transfer' refer to?

Transfers between institutions in different countries or jurisdictions Signup and view all the answers

What is the role of 'FATF'?

Referring to the Financial Action Task Force Signup and view all the answers

Study Notes

Key Definitions in MAS Notice 626 (Amendment) 2022

"2(c)" defines "executive authority" in a legal arrangement as any natural person with executive authority.
"Core Principles" refers to the banking supervision principles issued by the Basel Committee on Banking Supervision, securities regulation principles issued by the International Organisation of Securities Commissions, or insurance supervision principles issued by the International Association of Insurance Supervisors.
"Cross-border wire transfer" refers to wire transfers between institutions in different countries or jurisdictions.
"Custodian wallet service" refers to the service of safekeeping and administering digital payment tokens.
"Customer" in relation to a bank refers to a person with whom the bank establishes business relations or undertakes transactions without an account being opened.
"Digital CMP token" refers to a digital representation of a capital markets product that can be transferred, stored, or traded electronically.
"Digital payment token" has the same definition as in section 2(1) of the Payment Services Act.
"Digital payment token service" has the same definition as in section 2(1) of the Payment Services Act.
"Digital payment token transfer service" refers to the service of accepting and transferring digital payment tokens.
"Digital token" refers to either a digital payment token or a digital CMP token.
"Domestic wire transfer" refers to wire transfers within the same country or jurisdiction, even if the payment system is located elsewhere.
"FATF" refers to the Financial Action Task Force.
"Financial advice" refers to financial advisory services or advising on corporate finance.
"Financial group" refers to a group of entities exercising control and coordination over the rest of the group for the application of group supervision.
"Government entity" refers to a government, ministry, or agency established by a government.
"Legal arrangement" refers to a trust or similar arrangement.
"Legal person" refers to an entity other than a natural person that can establish a customer relationship or own property.
"Officer" refers to a director or member of the committee of management of a bank.
"Ordering institution" refers to the financial institution that initiates and transfers funds or digital tokens in a wire transfer or value transfer.
"Partnership" refers to a partnership, limited partnership, or limited liability partnership.
"Payment service transaction" refers to any transaction accepted, processed, or executed by a bank in the course of providing a specified payment service.
"Personal data" has the same definition as in the Personal Data Protection Act.
"PS Act" refers to the Payment Services Act.
"Reasonable measures" refers to appropriate measures that are proportional to the level of money laundering or terrorism financing risks.
"SFA" refers to the Securities and Futures Act.
"Specified payment service" refers to digital payment token services, digital payment token transfer services, and custodian wallet services.

Key Definitions in MAS Notice 626 (Amendment) 2022

"2 (c)" defines an executive authority in a legal arrangement
"Core Principles" refers to guidelines issued by banking, securities, and insurance supervisory bodies
"Cross-border wire transfer" refers to transfers between institutions in different countries
"Custodian wallet service" refers to the safekeeping and administration of digital payment tokens
"Customer" refers to a person with whom a bank establishes business relations or undertakes transactions
"Digital CMP token" refers to a digital representation of a capital markets product
"Digital payment token" has the same meaning as defined in the Payment Services Act
"Digital payment token service" has the same meaning as defined in the Payment Services Act
"Digital payment token transfer service" refers to the transfer of digital payment tokens between addresses or accounts
"Digital token" refers to a digital payment token or digital CMP token
"Domestic wire transfer" refers to transfers within the same country or jurisdiction
"FATF" refers to the Financial Action Task Force.

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