Singapore police swept across the city-state, seizing hundreds of millions of dollars in financial assets, a yacht and a fleet of luxury cars, all allegedly linked to Cambodia\u2019s murky and criminal world of online scams. <\/p>\n
Last month\u2019s dramatic seizure of assets linked to Cambodia\u2019s Prince Group, identified by US and UK authorities as a \u201ctransnational criminal empire\u201d, has reignited questions over the financial centre\u2019s soft underbelly and role as a conduit of illicit money. <\/p>\n
Singapore<\/a> has long prided itself as a financial hub, attracting international companies due to its strong rule of law and corruption-free authorities. <\/p>\n But high-profile cases of money laundering have exposed how, despite multiple crackdowns, Singaporean authorities are in a continuous game of whack-a-mole with fraudsters, on the lookout for vulnerabilities to exploit. <\/p>\n Singapore\u2019s proximity to south-east Asian scam centres has made it a prime location for criminals to launder their ill-gotten gains.<\/p>\n \u201cThe problem Singapore faces is that as a trading nation, it is built around inflows and outflows \u2014 its success makes it vulnerable to money laundering,\u201d said Rory Doyle, head of financial crime policy at Fenergo, a compliance company.<\/p>\n \u201cSingapore\u2019s geographical location and reputation within Asia make it a jurisdiction of choice for regional criminals,\u201d said Chengyi Ong, head of Asia-Pacific policy at Chainalysis, which tracks digital money flows.\u00a0<\/p>\n South-east Asia has in recent years emerged as the global centre for scam networks. The Prince Group case burst open last month when US and UK authorities put sanctions on 146 individuals<\/a> and entities connected to the group, including its alleged ringleader, Chen Zhi, a 37-year-old Chinese-born Cambodian national.<\/p>\n The US government seized $15bn worth of bitcoin connected to Prince Group and charged Chen with conspiring to commit wire fraud and money laundering. Chen\u2019s location is unknown.<\/p>\n Authorities alleged that Chen and his accomplices operated a vast, international criminal empire, forcing trafficked workers <\/a>in Cambodian scam compounds to steal billions of dollars from victims around the world, then laundered the proceeds through entities across Asia and offshore financial centres.\u00a0 <\/p>\n Singaporeans have been particularly vulnerable<\/a> to the online frauds \u2014 with more than S$1bn (US$768mn) lost last year \u2014 but the financial hub is also an attractive destination for the criminals.<\/p>\n \u201cCriminals don\u2019t want to lose their money and they see Singapore as the safe haven in south-east Asia,\u201d said Doyle.<\/p>\n On the US sanctions list were 17 companies registered in Singapore and three Singaporean nationals: Chen Xiuling, a 47-year-old who was a director of most of the city-state businesses; Alan Yeo Sin Huat, a 53-year-old financial assistant and wealth manager; and Nigel Tang Wan Bao Nabil, a 32-year-old superyacht captain.<\/p>\n The list also included DW Capital Holdings, Chen Zhi\u2019s Singapore family office, which was in receipt of tax incentives from the local regulator. The Monetary Authority of Singapore has since stopped those incentives and it is investigating whether DW Capital broke any rules. <\/p>\n MAS said: \u201cWhile a zero-incident regime is impossible in any major financial centre, we respond with thorough investigations and firm enforcement when we uncover wrongdoing, working closely with our international partners.\u201d<\/p>\n Chen Xiuling\u2019s lawyer declined to comment on her behalf. None of the other people or companies on the sanctions list based in Singapore responded to requests for comment. <\/p>\n The Prince Group, which has enlisted US law firm Boies Schiller Flexner, released a statement this week denying it or Chen Zhi had \u201cengaged in any unlawful activity\u201d.<\/p>\n Singaporean authorities had tightened compliance controls<\/a> after a huge money-laundering scandal two years ago. Members of a Chinese gang had used banks and family offices in Singapore to launder billions of dollars generated from illegal gambling websites operating in south-east Asia.<\/p>\n Singapore\u2019s vulnerability this time around has been digital currencies, with the Prince Group funnelling cryptocurrencies through unregulated or lightly overseen exchanges, analysts say. \u00a0<\/p>\n \u201cThat is the next set of issues the regulator is facing \u2014 the potential\u2009.\u2009.\u2009.\u2009for moving money between parties and escaping the normally regulated parts [of the industry],\u201d said Sopnendu Mohanty, chief executive of the Global Finance & Technology Network, an advisory firm, who was previously MAS\u2019s former chief fintech officer. \u201cThere are always bad actors in any new technology.\u201d<\/p>\n The Prince Group episode also has echoes of the scandal surrounding the collapse of the German payments company Wirecard<\/a>, in that professional services companies in Singapore were used to obscure the origins of money. <\/p>\n \u201cThe use of corporate service providers to set up complex business structures and shell companies is a particular point of vulnerability,\u201d said Ong. \u201cThese were all on display in the Prince Group case.\u201d<\/p>\n Doyle of Fenergo said MAS could follow the lead of the UK\u2019s Financial Conduct Authority in taking full responsibility<\/a> for preventing money laundering across finance companies and professional services firms.\u00a0<\/p>\n \u201cIf you bring the gatekeepers \u2014 the law firms, trust companies and professional services providers \u2014 all under the same regulatory oversight, think how much better it would be at identifying early and preventing those funds reaching the island,\u201d he said.<\/p>\n![\"Chen](\"https:\/\/images.ft.com\/v3\/image\/raw\/https%3A%2F%2Fd1e00ek4ebabms.cloudfront.net%2Fproduction%2Fdd0728c7-393c-4910-8e96-a52b344bd103.jpg?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1\")
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