MAS fines 5 payment firms S$960,000 for anti-money laundering lapses

The Monetary Authority of Singapore (MAS) has fined five major payment institutions a total of S$960,000 for breaches of its anti-money laundering and countering the financing of terrorism requirements.

The five firms, licensed to provide cross-border money transfer services, are Remsea, Arcade Plaza Traders (APT), J-Dee Remittance Services (J-Dee), Mobile Community Tech (MCT) and OxPay SG.

“Overall, the breaches exposed the major payment institutions to the risk of being used as a conduit for financial crime,” said MAS in a statement on Friday (Jun 27).

Among the lapses was the failure to conduct adequate customer due diligence measures. The regulator noted that this impeded the firms’ ability to sufficiently assess and mitigate the money laundering and terrorism financing risks associated with their customers.

“Additionally, the failure to provide information relating to wire transfer originators and wire transfer beneficiaries of cross-border wire transfers undermines the transparency and traceability of the movement of funds,” it said.

MAS added that the five institutions have established plans to remediate the findings, and it will monitor their progress.

In a bourse filing on Friday, Catalist-listed OxPay Financial : TVV -4% said that OxPay SG, its subsidiary, “deeply regrets” the lapses.

It added: “While there was no evidence of intentional wrongdoing or financial loss, OxPay SG recognises the importance of robust anti-money laundering and countering the financing of terrorism controls to ensure the integrity of its financial system.”

The company was fined a total of S$110,000 for breaches that took place between May 2021 and November 2022.

These included the failure to inquire if there existed any beneficial owners in relation to its customers, as well as the failure to screen its customers and their beneficial owners against relevant information sources to determine if there were any money laundering risks, prior to undertaking cross-border money transfer transactions.

OxPay Financial said that since MAS’ examination, OxPay SG has taken steps to enhance its system integrity under a newly appointed management team.

Among the five payment institutions that were fined by the regulator, Remsea was slapped with the highest composition penalty of S$280,000. This was for breaches that occurred between August 2020 and August 2023.

Besides neglecting to inquire if any beneficial owners existed in relation to its customers, Remsea had failed to obtain its customers’ residential addresses.

As the ordering institution, it also lapsed in including wire transfer originator information in messages or payment instructions for cross-border wire transfers.

APT received a composition penalty of S$260,000 for breaches that took place between March 2020 and August 2023.

For lapses between July 2022 and August 2023, the regulator fined J-Dee S$170,000. MCT’s penalty was S$140,000 for breaches which occurred from September 2021 to July 2023.

“To provide further guidance to the industry, MAS will be publishing an information paper to set out common issues noted, MAS’ supervisory expectations, and areas for improvement uncovered from MAS’ recent examinations of major payment institutions,” the regulator said.

Shares of OxPay Financial ended Friday up 8.7 per cent or S$0.002 at S$0.025, before the release of its statement.

Source: The Business Times © SPH Media Limited. Permission required for reproduction.

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