Wang Dehai, a Chinese national, was a key figure in a massive money-laundering operation in Singapore, involving over S$2.8 billion in assets, including gold bars, jewelry, cars, and properties. Dehai, on the run from Chinese authorities for his alleged involvement in an illegal gambling ring, established a family office and acquired significant assets in Singapore, including a S$23 million condominium in Orchard area.
Singapore’s Role as a Financial Hub
Singapore has long attracted global wealth, becoming one of the wealthiest countries in the world. The city-state’s policies offering tax incentives and residency pathways have drawn billionaires, leading to the money management sector overseeing assets worth $3.65 trillion, with a significant portion from abroad. However, the influx of Chinese investors in recent years, particularly following pandemic restrictions and industry crackdowns in China, has led to increased scrutiny of financial transactions and potential money laundering activities.
Government Response and Legal Loopholes
The government acknowledged the challenges in preventing money laundering through work pass frameworks. Some launderers may use dormant companies or active businesses to mask their illegal activities. Additionally, a loophole in Singaporean law requiring foreigners to hire locals as authorized representatives has led to some individuals becoming serial directors for numerous companies. Authorities are now considering revising these policies to strengthen their anti-money laundering (AML) controls.
Banking Sector’s Involvement
Several banks, including Credit Suisse, Citigroup, and local Singaporean banks, have been implicated for handling transactions related to the accused individuals. The Monetary Authority of Singapore (MAS) is engaging with these banks and conducting inspections to tighten controls against money laundering. Private bankers have also been suspected of facilitating these illegal activities.
Ongoing Investigations and Future Measures
With more than S$1 billion in bank accounts seized and several suspects still at large, authorities continue to probe deeper into the case. Singapore is rated above average in fighting illicit funds, but the recent case highlights the need for enhanced due diligence, particularly in sectors like real estate. The government is working towards full implementation of FATF’s recommendations and is considering tightening immigration and business setup processes to prevent such occurrences in the future.
Also learn about OCBC Sues Suspect in Major Money Laundering Case.
