Cryptocurrency Investment Companies Setting Up Operations and Measures in Place to Prevent Money Laundering and Fraud
Prime Minister's OfficeSpeakers
Summary
This question concerns MP Yip Hon Weng’s inquiry into the influx of cryptocurrency investment companies and the safeguards established to prevent money laundering and fraudulent operations. Senior Minister Tharman Shanmugaratnam responded that businesses facilitating digital payment token services are regulated under the Payment Services Act 2019, which focuses on technology risks and illicit financing. The Monetary Authority of Singapore (MAS) administers a rigorous licensing process, rejecting firms with weak governance and referring suspected illicit activities to the Police for investigation. MAS further conducts surveillance to identify unlicensed providers, places suspicious entities on its Investor Alert List, and issues public advisories to warn consumers against potential scams. Consumers are encouraged to verify the licensing status of cryptocurrency firms through the MAS website to ensure they are dealing with supervised or exempted entities.
Transcript
2 Mr Yip Hon Weng asked the Prime Minister in view of Singapore opening up to cryptocurrency in the last two years (a) whether there is an influx of businessmen interested in setting up cryptocurrency investment companies in Singapore; and (b) what are the safeguards to prevent money laundering operators and fraudsters from setting up such businesses here.
Mr Tharman Shanmugaratnam (for the Prime Minister): In Singapore, as in other jurisdictions, not all activities related to digital payment token (DPT) – referred to as cryptocurrencies – are regulated. A company that provides a service which involves buying, selling or facilitating the exchange of DPTs would be regulated under the Payment Services Act 2019 (PS Act). The Monetary Authority of Singapore (MAS) would not have information on the number of parties interested in setting up cryptocurrency investment companies in Singapore unless they apply for a licence from MAS.
MAS' regulation under the PS Act focuses on money laundering, terrorism financing risks and technology risks. It administers a rigorous licensing process to ensure that we admit DPT service providers with strong governance structures and robust controls to address these risks. Many applicants have been turned away. Where MAS has reason to suspect that an applicant is involved in illicit activities, MAS will, besides rejecting the application, refer the matter to the Police for investigation.
MAS also conducts surveillance to identify unlicensed firms that illegally provide DPT services or solicit customers in Singapore. It will instruct these entities to stop offering services to Singapore residents and refer them to the Police for investigation. MAS may also place them on its Investor Alert List to warn the public that these entities are not supervised by MAS.
MAS also works closely with the Police to combat cryptocurrency scams. MAS and the Police have issued public advisories alerting consumers to guard against fraudulent websites soliciting cryptocurrency investments. When dealing with cryptocurrency firms, consumers should check if the entities are licensed or have been granted an exemption to hold a licence by referring to MAS' website.