Page 1 of 2

The Monetary Authority of Singapore (MAS) is looking to curb market abuse and facilitate investigations.

In a consultation paper released on Monday, the central bank's proposals include the introduction of a client identification rule, aimed at identifying ultimate beneficial owners (UBOs) of orders and trades (O&Ts) executed in omnibus accounts held in the name of foreign intermediaries.

It noted that the absence of information and delays in retrieving information on individuals who own or control trading accounts have impeded investigations in past cases of market abuse. Challenges faced by regulators have been worsened by technology, with the rising number of cross-border transactions amid the lack of controls.

Five Business Days

Under this rule, FIs are required to provide information on UBOs to the MAS or other law-enforcement agencies within five business days of being asked. FIs will need to put in place measures such as a written agreement with clients, which obliges clients to give up such information to the authorities when requested. If an FI's client refuses to disclose the identities of underlying clients to the FI, such information may be provided directly to the requesting law enforcement agency.

«In enforcing the rule, the MAS will take into consideration whether the FI has acted in good faith and with reasonable care to comply with the requirement,» said the regulator in its consultation paper. 

Communications on Cellphones Not Recorded

Currently, keeping records of communication on broker-assisted O&Ts are usually not recorded or retained by FIs, especially if these were made on personal devices such as cellphones.«Such records would also constitute critical evidence in market-abuse investigations into the identities of persons who instructed the O&T,» said the MAS.