Jul 01, 2014

    Cops beef up to fight white collar crime

    SINGAPORE'S white-collar-crime police - who now want to be known as the country's Financial Police - have gone through their biggest reorganisation in over a decade.

    They have significantly beefed up their resources, to better position themselves to combat new threats posed by financial crime, both domestically and internationally.

    The Commercial Affairs Department (CAD) of the Singapore Police Force (SPF), in its annual report out on Sunday and through an interview with The Business Times, laid out just why such fundamental changes to the department were necessary to meet the new challenges.

    "As financial crime increases in scale and becomes more complex, we need to sub-specialise thematically, according to the crime concerns of the day," said CAD director Tan Boon Gin.

    Singapore's openness as an international transport hub and financial centre exposes it to cross-border money laundering and terrorist financing risks, he said.

    "We are seeing a trend of overseas criminals seeking to launder money through Singapore bank accounts. We have tripled our financial investigation resources, with dedicated branches for international cooperation and terrorist financing, investigations into proceeds from both domestic and overseas criminal activity and serious tax crimes (such as serious fraudulent tax evasion)."

    And, with financial intelligence being the first line of detection for money laundering and terrorist financing, the CAD has also expanded its Suspicious Transaction Reporting Office, to make it robust enough to handle the reports generated by the world's fourth-largest financial centre.

    The office, which is Singapore's Financial Intelligence Unit - and the central agency here for receiving, analysing and disseminating suspicious transaction reports - was expanded from a branch to a full-fledged division, made up of three analytical branches and one field-research branch.

    In addition to these cross-border risks, Mr Tan said that the CAD has also geared up to combat fraud that takes place on a more domestic plane: investment and securities-related fraud - for example, insider trading and market manipulation.

    "The enforcement scope of the regulated sector is set to increase with the proposal to criminalise the manipulation of financial benchmarks," he said.

    The proposal was made last year by Singapore's financial services regulator, the Monetary Authority of Singapore, following an investigation into traders involved in trying to rig benchmark interest rates.

    "Recent events in the stock market (for example, last year's penny-stock crash) also suggest an increase in the scale and complexity of market abuse," Mr Tan added.

    "To gear up for these challenges, we have expanded the securities fraud branch to a full division comprising three branches, including a dedicated branch to investigate fraud where the victim is a public company."

    The CAD is also staying on top of investment fraud that falls outside the reach of Singapore's financial regulators, such as pyramid schemes and commodities schemes in gold or wine which may look like financial instruments but are in fact not regulated by the authorities.

    The complexity of such schemes - using increasingly innovative business models and multiple companies - was what prompted the CAD to create the Investment Fraud Division during its reorganisation.

    The CAD is also staying on top of issues involving the misappropriation of government funds and public donations to charities and non-profit organisations.

    "We have dedicated resources to combat investment fraud and public institutional fraud to improve the turnaround time for investigating these offences and speed up the recovery process for victims," Mr Tan said.

    A group made up of three divisions looks into these, including credit card and ATM skimming and counterfeit currency, as well as fraud involving private companies and businesses, as well as charities and public organisations.