Why is Singapore being strong against illegal wealth from different countries?

As per a report from Reuters in the year 2015, the notorious OneMBD scandal of the Malaysian government implicated multiple banks based in Singapore, drawing widespread attention to the city-state.

Following this scandal, a significant global spotlight fell upon an incident of money laundering, particularly due to the substantial assets seized, which included numerous houses and were believed to have ties to China.

The Reuters report also highlighted that as Singapore has evolved into an economic hub, concerns have escalated regarding its potential to become a hub for illegal financial activities.

According to the Boston Consulting Group, a consulting firm based in the United States, cross-border or foreign investments in Singapore reached $1.5 trillion the previous year. Consequently, Singapore has emerged as the third largest offshore investment center, following Switzerland and Hong Kong, where affluent individuals secure their wealth.

In an interview with Australia’s ABC news channel last August, Clancy Moore, the Chief Executive of Transparency International Australia, emphasized that despite Singapore’s reputation for upholding the rule of law, it has paradoxically become an appealing destination for money launderers to establish their operations.

He stated, “Singapore has become a sanctuary for criminals, scammers, and felons to conceal their illegitimate funds and evade justice.”

“It has turned into the headquarters for numerous regional banking institutions, benefiting from remarkably low corporate taxes, allowing individuals to establish a company with a mere click of a computer mouse.”

As an illustration, he mentioned, “We are aware that various well-organized criminal syndicates and autocratic regimes like Myanmar’s junta have utilized Singapore as a financial center to legitimize their illicit funds.”

Singapore’s Minister of State for Trade and Industry, Alvin Tan, expressed his concerns to the country’s parliament, as reported by Nikkei Asia, saying, “Singapore’s hard-earned status as a reliable and well-governed international financial and trade hub, underscored by a robust rule of law, is in jeopardy.”

He added, “Our objectives are dual-fold. One is to foster a diverse, prosperous economic center. The other is to uphold a transparent system. These two objectives will progress in parallel. We will not compromise one for the other.”

Initially estimated at one billion Singapore dollars, the assets seized in August last year have significantly appreciated, currently valued at about $2.8 billion, as revealed by Josephine Teo, Singapore’s second minister of the interior, during a parliamentary session.

These assets encompass 152 buildings, 62 vehicles valued at approximately $1.24 billion, thousands of bottles of liquor and wine, bank deposits totaling about $1.45 billion, 38 million dollars’ worth of cryptocurrency, 68 gold bars, 294 luxury bags, and more.

The Singaporean government has reported that many of the suspects acquired high-value assets such as vehicles, alcohol, or jewelry, which do not fall under the purview of Singaporean law, as they are not considered precious stones.