The Monetary Authority of Singapore (MAS) is visiting fund management companies in Singapore to assess their compliance with the changes derived from the Singaporean regulatory framework enhancements in 2012.
Since this summer Laven has heard of several visits by the MAS within the industry. In addition to covering general compliance aspects, the visits appear to focus in particular on anti-money laundering policies and internal audits.
MAS regulatory enhancements since 2012
The changes in 2012 established a more rigid Singaporean regulatory structure which was more in line with regulatory practices around the world. To meet regulatory obligations, fund managers must have in place, among others, a compliance manual, a documented risk management framework and carry out regular internal audits.
The MAS has also enhanced its anti-money laundering requirements, following a consultation paper issued in July 2014. As part of a manager’s AML procedures and controls, the MAS now expects the implementation of a risk-based approach which includes effective customer due diligence measures depending on client risk categories. Further, one of the areas covered in the consultation was the definition of a client and how this pertains to fund managers. Traditionally the MAS has been of the view that a manager should procure AML on any fund investors, even if a manager’s contractual relationship exists with the fund only and the fund’s administrator carries out AML work on behalf of the fund. Laven took part in the consultation and specifically recommended the MAS to consider the use of third parties such as fund administrators and how this may be taken into consideration in the definition of a client.
Knowing the new rules and regulations
Laven Partners is in regular discussions with the MAS. Gordon Lai, Senior Associate at Laven Partners (Singapore) notes:
“These visits are in line with the more hands-on and pro-active approach the MAS has taken in the last couple of years. The MAS is keen on meeting international regulatory standards, and regulator’s visits – especially in the US but also in the EU – are part of the standard operating practice of regulators. The MAS is clearly stepping up its efforts of continuous monitoring the asset management industry.”
In order to aptly comply with regulations and avoid surprises when the MAS knocks on your door, Laven Partners recommends an independent review to provide an expert opinion on the compliance infrastructure. This can be done in the form of an Internal Audit or a mock regulator visit.
Please contact Laven Partners if you are interested in our compliance services, or for any other queries you may have: [email protected] – +65 6631 2889.
