On February 6, 2024, the Monetary Authority of Singapore (MAS) published guidelines outlining best practices for financial institutions in managing risks associated with money laundering, terrorism financing, and proliferation financing (ML/TF/PF) when receiving referrals from corporate service providers.

The scope of this paper encompasses banks receiving customer referrals from all entities offering FATF-defined Corporate Service Provider (CSP) services, both domestically within Singapore and internationally.

Key recommendations include:

•      Establishing a robust risk management framework that delineates the institution’s risk appetite based on factors such as the type of CSPs involved, including whether the foreign CSP operates in a high-risk jurisdiction and whether it is subject to regulation.

•      Conducting comprehensive due diligence on CSPs and promptly reporting any suspicious transactions.

•      Maintaining a roster of CSPs that have undergone assessment and are deemed to align with the bank’s acceptable risk appetite.

•      Establishing clear criteria for accepting customer referrals from non-panel CSPs, ensuring adherence to risk management standards.

•      Implementing a disempowerment process triggered by identified risks or breaches, ensuring swift action in response to adverse findings.

•      Periodically assessing CSPs for changes in ML/TF/PF risks and ongoing suitability.