Developers face new requirements as gov't safeguards property market from AML/TF

The new anti-money laundering and terrorism financing requirements will take effect on 28 June.

Come 28th of June this year, the government of Singapore is introducing new anti-money laundering and anti-terrorism financing measures for property developers and for good reason.

In 2016, two real estate agents were fined for failing to report suspicious property transactions: one involving a a bungalow in Sentosa Cove worth $23.8m and another involving a new condominium unit. Both agents dealt with individuals who were later found guilty of conducting illegal activities. Making sure such incidents don't happen again and to keep up with international standards, Singapore is dead set on tightening up regulations.

"Given the vibrancy of the real estate market in Singapore, the importance of having effective laws and regulations in place to safeguard against the occurrence of any ML or TF activities is well-recognised," Pat Lynn Leong, senior partner at Dentons Rodyk, told the Singapore Business Review.

The requirements 

Under the new measure, developers will be required to perform risk analysis, carry out customer due diligence (CDD) measures, report suspicious transactions, and keep records for five years.

In performing risk analysis, Leong said developers must consider looking into "the profile of their purchasers and the countries which they are from or in."

Gazalle Mok, partner at Rajah & Tann, said developers should also implement internal programmes and measures that include internal audits to test and monitor the policies, procedures and controls, with a corresponding duty to enhance them if necessary.