The Monetary Authority of Singapore (MAS) has published a response to its consultation paper of 16 January 2018 (the 2018 CP), which proposed changes to the anti-money-laundering and countering-the-financing-of-terrorism (AML/CFT) rules for money-changing and remittance businesses (together, licensees) licensed under the Money-changing and Remittance Businesses Act (Cap. 187) (MCRBA).
This alert summarises these changes and considers the key practical impact for affected institutions.
Overview of changes
Prohibition on issuance of bearer negotiable instruments and restrictions on cash payouts
The 2018 CP proposed that licensees should be prohibited from issuing bearer negotiable instruments (broadly, traveller’s cheques and other instruments in bearer form the title to which passes to the recipient on delivery) to the following persons:
- in the case of a money-changer, any person for whom the money-changer undertakes a transaction;
- any person to whom a licensee makes a cash or cash-equivalent payment in Singapore following an inward remittance from overseas; and
- any person on whose behalf a licensee conducts a foreign exchange purchase or sale transaction which is not a money-changing transaction, without the use of foreign currency notes (respectively, an FX Counterparty and an FX Transaction).
In respect of any inward remittance transaction from overseas or any FX Transaction, licensees would also be prohibited from making any payment in cash of S$20,000 or more to any of the recipients outlined above or to any person they may appoint to act on their behalf (although such payments may be made by cheque under certain conditions).
The above changes have now been implemented as proposed.