New Bill gives MAS wider investigative, supervisory powers over financial services sector

THE Monetary Authority of Singapore (MAS) may have wider investigative and supervisory powers over the monetary business, with a brand new Bill handed in Parliament on March 7.

These embrace the flexibility to enter premises and not using a warrant and with out first issuing orders to a suspect, to situation legally binding instructions to holders of capital markets companies licences, and to approve appointments of key folks in additional kinds of monetary establishments.

Minister of State for Trade and Industry Alvin Tan stated in his studying of the Bill that the modifications will improve MAS’ capability to implement its regulatory regime and extra successfully supervise capital markets monetary establishments.

“This will further strengthen Singapore’s position as a safe and trusted international financial centre,” he stated.

“As our financial industry grows in size and complexity, MAS must continually review and enhance its regulatory powers to ensure that it can effectively supervise financial institutions, as well as investigate and punish serious misconduct in our financial sector,” he added.

One of the amendments is aimed toward strengthening the MAS’ capabilities in gathering proof. It will give the authority extra energy to require folks to seem earlier than an MAS officer for examination and assertion recording for investigation functions.

It can even imply that MAS can enter premises and not using a warrant, with out first issuing orders to a suspect to supply data. Before the amendments, underneath two Acts, MAS officers needed to first situation orders and present {that a} suspect has didn’t comply, earlier than they may enter premises. This energy to enter premises and not using a warrant has now been prolonged to another MAS-administered Acts as nicely.

“This will enable MAS to enter premises without tipping off the suspect, and therefore reduce the risk of the suspect destroying evidence related to the investigation,” Mr Tan stated.

In addition, the Bill will broaden provisions that permit for the switch of proof between MAS, the police and different regulation enforcement businesses.

MAS can even have extra energy in capital markets, with the flexibility to situation instructions to holders of capital markets companies licences over their unregulated companies. Currently, holders of such licences can conduct unregulated enterprise, akin to dealing in merchandise not regulated by MAS, like digital cost token derivatives which can be traded on abroad exchanges.

“These unregulated businesses may pose contagion risks to capital markets services licence holders’ regulated businesses. For instance, losses from a licence holder’s unregulated business could adversely impact its ability to meet its obligations to customers in its regulated business,” Mr Tan stated.

“Customers may also not be fully aware that regulatory protections do not apply to the licence holder’s unregulated businesses.”

While MAS has issued steering to such licence holders on having measures to mitigate dangers and safeguards they need to undertake, the Bill will empower the authority to situation legally binding instructions to them, he added.

MAS can even have energy over approving appointments of key folks in regionally included, recognised market operators, recognised clearing homes and authorised trustees – firms that the present laws doesn’t cowl.

Finally, MAS can even require firms like authorised exchanges, clearing homes, holding firms and licensed commerce repositories to get approval after they appoint exterior auditors on an annual foundation.

Mr Tan stated it’s important that the auditors appointed by these firms can satisfactorily carry out their duties, given the central function such firms play in capital markets.

“With these amendments, MAS will align the approach for capital markets financial institutions with the approach that MAS has taken for other systemically important financial institutions under its purview, such as banks and insurance companies,” Mr Tan stated.

He additionally addressed considerations that some MPs introduced up. Mr Louis Ng (Nee Soon GRC) requested what sort of steering enforcement officers will obtain to train their expanded investigative powers.

Mr Tan stated: “MAS has internal processes and guidance which (take) into account police procedures and practices to ensure that MAS officers exercise investigative powers lawfully and judiciously.”

He added: “MAS recognises that the ability to enter premises is a significant power. However, this power is necessary to enable MAS to effectively investigate potential breaches under the MAS-administered Acts.” THE STRAITS TIMES