Michaela
Summary: Why were Singapore banks fined, and how does Shiba Inu’s approach compare?
Nine financial institutions in Singapore were fined over US$21 million for AML/CFT compliance failures linked to a major money laundering case. Issues included poor customer risk assessments and weak monitoring despite having policies in place. In contrast, Shiba Inu’s upcoming FHE technology aims to enhance crypto AML detection while preserving user privacy.
The Monetary Authority of Singapore (MAS) has imposed US$21.55 million in penalties on nine Singapore banks, capital market services firms, and trust companies for regulatory breaches linked to a US$2.36 billion money laundering case.
The MAS concluded its supervisory reviews of financial institutions and employees linked to individuals implicated in the August 2023 money laundering case. In an official statement, the financial regulator said the examinations identified compliance failures with the authority’s Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) standards among certain institutions and their personnel.
The latest measures by the MAS mark the completion of its enforcement efforts against financial institutions found to have significant links to the high-profile money laundering case.
Among the nine financial institutions penalized, the largest fines were issued to the Credit Suisse Singapore Branch, United Overseas Bank Limited (UOB), and UBS AG’s Singapore Branch. Credit Suisse received a composition penalty of approximately US$4.29 million (S$5.8 million), followed by UOB with a fine of around US$4.14 million (S$5.6 million), and UBS with a penalty of roughly US$2.22 million (S$3 million).
The MAS reportedly considered several key factors in determining the penalties imposed on financial institutions. These included the level of each institution’s exposure to the persons of interest (POIs), the number of violations of MAS regulations, and the severity of deficiencies in their AML/CFT frameworks.
Furthermore, the financial regulator reportedly noted that while the majority of institutions had put the necessary AML/CFT policies and frameworks in place, the breaches were primarily the result of weak or inconsistent execution of these measures.
Specifically, MAS noted deficiencies across several critical areas, including customer risk assessment, verification of source of wealth for high-risk clients, transaction monitoring, and follow-up actions after the filing of Suspicious Transaction Reports (STRs). These lapses were found to varying degrees across multiple financial institutions.
Additionally, MAS has taken regulatory action not only against the financial institutions themselves but also against individuals responsible for overseeing the institutions’ relationships with the POIs.
Shiba Inu’s Upcoming FHE Tech Could Boost Crypto AML Detection
Unlike traditional financial systems, cryptocurrencies have made it easier for illicit funds to be moved and obscured, posing a growing challenge for the industry in recent years.
On a more positive note, however, Shiba Inu’s planned integration of Fully Homomorphic Encryption (FHE) technology could introduce a significant advancement in combating money laundering within the crypto space. FHE allows data to be analyzed while still encrypted, meaning suspicious activity can be flagged without exposing user identities or sensitive information.
This breakthrough could enable decentralized applications (dApps) in the Shiba Inu ecosystem to run advanced compliance checks and transaction monitoring without sacrificing privacy—addressing a long-standing challenge in crypto: balancing anonymity with regulatory oversight.
By using FHE, Shiba Inu aims to help regulators and developers detect illicit financial behavior more effectively, while still protecting user confidentiality on-chain.
Read More
- Singapore’s Startup Ecosystem: A Global Model for Innovation and Growth
- $TREAT Debuts: ‘First FHE’ Token on Mainnet, CEO Declares
- Exclusive Interview/ Dr Rand Hindi on Zama’s Vision for Shiba Inu Privacy Through FHE
Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
