Singapore’s Gambling-Linked Money Laundering Breaks the $2B Mark

Posted on: October 4, 2023, 06:56h. 

Last updated on: October 4, 2023, 11:43h.

Singapore continues to grapple with a significant money-laundering scandal, with investigators uncovering evidence that suggests the illicit funds involved could now exceed $2 billion. The scandal is intricately linked to the illegal gambling industry, raising concerns about the effectiveness of financial regulatory measures in place.

The sign above the entrance to the Monetary Authority of Singapore's offices
The sign above the entrance to the Monetary Authority of Singapore’s offices. The country continues to find more activity related to a large money-laundering scheme. (Image: Bloomberg)

The investigation, which began in August, initially led to the seizure of SGD1 billion (US$740.4 million) in cash and assets. That quickly rose to SGD2.4 billion (US$1.75 billion) as authorities dove deeper into the operation.

As evidence continues to emerge, investigators now believe that the scale of the money laundering operation may far surpass initial estimates. The latest figure puts the total of seized cash and assets at SGD$2.8 billion ($2.04 billion) and growing.

The Money Trail Never Ends

The illicit financial transactions are suspected to have taken place through various channels in support of the illegal gambling industry. Several dozen individuals were able to exploit vulnerabilities and loopholes in existing regulatory frameworks, with 10 already under arrest.

All 10 are Chinese nationals who arrived in Singapore under passports from other countries, including Cyprus, the Dominican Republic, and Turkey. At least one person, reportedly higher up in the organization, also has alleged ties to the Philippine Offshore Gaming Operator (POGO) scheme in the Philippines.

The perpetrators are believed to have engaged in complex schemes to hide their identities and the true sources of the funds. This is making it more challenging for authorities to trace and apprehend those involved.

The list of seized assets has grown to include 162 properties and at least 62 luxury vehicles. Authorities also continue to collect gold, high-end jewelry, and expensive bottles of wine. They’re also freezing cryptocurrency accounts and confiscating cash. No one is willing to say how far the investigation will go.

In response to the escalating situation, the Singaporean government has taken decisive action by launching parliamentary inquiries to delve deeper into the crimes. The inquiries aim to scrutinize the regulatory measures in place, identify gaps in the system, and propose necessary reforms to prevent such incidents in the future.

The government is collaborating closely with law enforcement agencies and financial institutions to trace the movements of the illicit funds. Authorities are also working to identify and apprehend the individuals responsible for orchestrating the money-laundering operation.

Financial Overhaul Coming

As the investigation unfolds, concerns about the potential impact on Singapore’s reputation as a global financial hub and tourist destination are rising. The government is keen on addressing these concerns promptly and effectively to restore confidence in its regulatory systems.

Second Home Affairs Minister Josephine Teo appeared before Singapore’s Parliament this week, where she asserted that this could likely be the largest money laundering scandal in the world. She confirmed that, at the very least, it’s the largest in Singapore’s history.

In her speech, Teo stated that there were 43K suspicious transactions reported in Singapore each year from 2020 to 2022. Despite the high number of reports, a small number of people were able to orchestrate a $2B money-laundering scheme undetected.

Second Minister of Finance Indranee Rajah weighed in on the situation as well. She confirmed the involvement of the government in the investigation, with an interministerial committee launching to oversee “sophisticated” financial crimes.

Financial institutions implicated in the scandal will face heightened scrutiny. Regulatory bodies are intensifying their efforts to ensure compliance with anti-money laundering (AML) and counter-terrorist financing (CTF) regulations. Singapore has traditionally been known for its robust regulatory framework, and the scandal is making that position unstable.