Singapore's money laundering risk edges up on global index

This is due to higher risks in indicators of corruption, bribery, environmental crimes

- Angela Tan

Singapore's money laundering and terrorist financing (ML/TF) risk level has inched up slightly, according to the 2023 Basel Anti-Money Laundering (AML) Index.

Its score in the index rose to 4.30 out of 10 from 4.28 in 2022. The higher the score, the more "dirty money" risks a country faces.

Dr Kateryna Boguslavska, project manager of Basel AML Index at the Basel Institute on Governance in Switzerland, told The Straits Times that "it falls into the category of a medium-risk jurisdiction for ML/ TF".

The slight rise in Singapore's score was due to higher risks in the indicators of corruption, bribery and environmental crimes. However, these were "not dramatic", she noted.

She added: "Even after the increase, the risks in these specific areas are still at a relatively low level."

The Basel AML Index ranks global jurisdictions according to their risks of money laundering and terror financing.

The index uses a methodology based on 18 indicators from publicly available sources such as the Financial Action Task Force (FATF), a global body that fights money laundering, and Transparency International, a corruption fighter.

Information from the World Bank and World Economic Forum is also used.

The indicators are categorised into five domains: quality of antimoney laundering and counter-financing of terrorism (AML/CFT) framework; bribery and corruption risk; financial transparency and standards; public transparency and accountability; and legal and political risk.

Singapore's weakest domain was the quality of its AML/CFT framework, with a score of 5.28. Particular weak spots involved the FATF assessment and Financial Secrecy Index data, Dr Boguslavska said.

In the other four domains, the Republic enjoyed relatively low risk scores.

The data used by the Basel AML Index does not reflect the latest money laundering cases, she added.