One of the greatest advantages of having an offshore bank account in Singapore is its bank secrecy law because the chance of anyone knowing you have got a huge sum of money which you really want to hide for any reason is pretty low. And I am not saying Singapore is definitely a money laundering centre but who is to say that Singapore will not become one in the future?
According to the Bloomberg article on the rapid growth of Asia’s millionaires, it was reported that Asia had 2.3 million millionaires last year, an increase of 8.2%. Singapore millionaires rose 22.4% to 48,500 while in US, a 10% increase to 2.5 million.
Naturally, it is not difficult to assume that some of these world’s riches might be dealing in money laundering activities to amass their wealth while some would attempt to avoid massive taxes levied on their assets and earnings. In the case of the latter, if you were a millionaire who does not want to pay extra taxes on your income, what would you do? I would certainly hide my money in places with low levels of transparency to avoid scrutiny by government authorities in my home country. Illegal activities like these are not something new to this world:
“Historically, bank secrecy laws have served an important political function. Germany, because of its past dealings with dictatorships, traditionally resisted relaxation of bank secrecy laws, contending those laws were essential to its citizens as a safeguard against political dictatorship. Germany recently embraced banking information exchange, noting that secrecy laws are no longer protecting citizens against dictatorships but are being used by international drug dealers and money launderers to hide criminal enterprises.” – Tax Prophet
So since Singapore will not be changing its tough banking secrecy laws despite calls from the European Union for more transparency as reported in Reuters, how prepared are our monetary authorities, MAS and tax authorities, IRAS to curb any form of organised crime like money laundering and tax evasion activities as a result of the secrecy laws? Now that we are building casinos in Singapore, it is even more critical that we look into the degree of casino compliance with the reporting requirements. From what I know, there has yet been any auditing standards on casinos, for example.
More information on Bank Secrecy Laws of Singapore can be found here.
More information on how money laundering works can be found here.
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