Singapore S$1 Billion Laundering Scandal Embroils Its Banking Giants

Some of the biggest local and international banks in Singapore are becoming embroiled in one of the city-state’s largest money laundering cases involving more than S$1 billion ($740 million) of assets.

(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 involving more than S$1 billion ($740 million) of assets.

In charge sheets seen by Bloomberg News, some of the individuals who were arrested and charged this month held funds totaling millions — from unlicensed moneylending in China and illegal gambling — in United Overseas Bank Ltd. and the local units of Citigroup Inc. and RHB Bank Bhd. They also allegedly tried to cheat Oversea-Chinese Banking Corp., Standard Chartered Plc and CIMB Bank Bhd. using fake documents, the charge sheets show.  

The wide roster of banks join property agents, precious metals dealers and golf clubs in the city that have been drawn into this scandal, raising questions about guardrails against illicit money flowing into one of the world’s most important financial hubs.

The accused allegedly used their criminal proceeds to buy luxury cars, Tether stablecoins and in one case, an upscale condominium unit near the city’s prime shopping belt for S$23 million, the charge sheets show. Some also allegedly had millions in safe deposit boxes held with Certis Cisco Security Pte., a security firm backed by state investor Temasek Holdings Pte.   

Most of the 10 people arrested were charged with more offenses on Wednesday in court. Authorities have earlier said they are seeking documents from at least 10 financial institutions in relation to the case, although they weren’t named. 

Before this case, Singapore was rocked by scandals involving huge money flows from Malaysia’s state fund 1MDB and German firm Wirecard AG. The blow-ups have led to financiers being banned, people jailed and banks slapped with fines for inadequate controls. In May, lawmakers passed a bill that paved the way for banks to share information on potentially risky clients. 

Separately, DBS Group Holdings Ltd., the country’s largest bank, and Bank of Singapore Ltd., OCBC’s private-banking arm, are both creditors to investment firms linked to two accused individuals, according to business filings seen by Bloomberg News.

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. 

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 didn’t specify the size of the exposure. 

A spokesperson for DBS said the lender will continue its work “to make Singapore a place where criminals cannot find harbor,” though didn’t comment on specific names. Citi’s spokesperson said the bank has been working with authorities to strengthen and protect the integrity of the financial system, adding it’s committed to ensuring the highest standard of governance and controls. OCBC and Certis Cisco declined to comment.

CIMB said it doesn’t comment on any individuals, ongoing investigations or court proceedings, and that the bank is fully committed to strong corporate governance and strict compliance with banking standards in line with its anti-money laundering policy.

Standard Chartered and RHB didn’t immediately respond to requests for comment. 

Su Haijin and Su Baolin are both in remand. Su Baolin’s lawyers declined to comment while Su Haijin’s attorneys didn’t immediately respond to a request for comment. 

The Monetary Authority of Singapore 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 didn’t immediately respond to a request for comment.

–With assistance from Suvashree Ghosh and Ambereen Choudhury.

(Updates with bank comments from 11th paragraph)

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