Singapore Says Money-Mule Cases Increase as Residents Swindled

Singapore Says Money-Mule Cases Increase as Residents Swindled

Singapore police and banks urged the city-state’s residents to be wary of fraudsters seeking to use their bank accounts to funnel illegal funds after an increase of reported cases this year. The number of reported cases of illegitimate cash being given to so-called money mules to hand over to a third party increased to 133 in the first nine months of this year, up from 93 for all of 2012, the police, the city’s bank association and the National Crime Prevention Council said in a statement today. The amount of illegal monies in those cases fell to S$15.5 million ($12.4 million) from 2012’s S$24.6 million.“The police take a serious view of the activities of money mules,” Ian Wong, deputy director of the force’s commercial affairs department, said in the statement. “The illicit funds that money mules assist to transfer may also be used by fraudsters to finance and perpetuate their criminal activities.”

Singapore’s central bank is stepping up its anti-money laundering rules in line with global regulations following U.S. authorities’ investigation of several Swiss banks for their dealings on behalf of American clients. The Monetary Authority of Singapore criminalized from July the use of financial institutions in the city-state by clients to evade tax.

Individuals being used as money mules can face a fine of as much as S$500,000 or a jail term of as long as seven years, according to today’s statement. Non-individuals risk a fine of as much as S$1 million.

Social Networks

Overseas fraudsters often befriend Singapore residents through social networking sites or by making them believe they have been recruited as the local representative of a foreign company, the agencies said in the statement. The people are then persuaded to take money into their personal bank accounts, which they then transfer into another bank account or withdraw and deliver to a third party, they said.

“Banks are cooperating with the authorities in monitoring unusual transactions in bank accounts,” Ong-Ang Ai Boon, a director at the Association of Banks in Singapore, said in the statement.

UBS AG and Credit Suisse Group AG, Switzerland’s largest banks, are among firms implicated in a U.S. crackdown since 2008 on offshore tax evasion that led to charges against about 70 American taxpayers and 30 bankers, lawyers and advisers.

The U.S. charged UBS in 2009 with aiding tax evasion by thousands of American clients. The Zurich-based bank avoided prosecution by paying a $780 million penalty, admitting it fostered tax evasion and agreeding to hand over data on client accounts to U.S. tax officials.

Wegelin & Co., Switzerland’s oldest private bank, pleaded guilty in January this year for helping U.S. taxpayers hide as much as $1.5 billion from the Internal Revenue Service.

To contact the reporter on this story: Sanat Vallikappen in Singapore at vallikappen@bloomberg.net

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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