Singapore Banks Share Names of Clients Embracing Tax Amnesty

Private banks in Singapore are sharing with local police the names of clients embracing the Indonesian tax amnesty.

Singapore's Commercial Affairs Department (CAD), a police unit that deals with financial crime, told banks last year they must file a report whenever a client takes part in a tax amnesty scheme, the sources told news agency «Reuters».

After initial resistance from the banks, worried they might lose clients, that message was reinforced this year by the Monetary Authority of Singapore (MAS), the country's central bank, when Indonesia launched a tax amnesty aimed at wooing back some of the cash its wealthy citizens have stashed in Singapore, the sources said.

Banks Failed to Impose Robust Controls

Singapore made tax evasion a criminal offense in 2013, and is toughening up the implementation of the law after a money-laundering investigation into state-backed fund 1MDB in neighboring Malaysia exposed how some of its banks failed to impose robust controls on suspicious money flows.

Indonesians account for an estimated $200 billion of private banking assets managed in Singapore, or 40 percent of the total.

Fear of Such Scrutiny

Both the Singapore police and MAS declined to comment.

The fear of such scrutiny could deter Indonesians from considering the amnesty, which runs to March 2017 and has so far had a tepid uptake. The Indonesian tax office said 393 trillion rupiah ($30 billion) of assets had been declared as of Sept. 13, of which at least 30 trillion rupiah are in Singapore.

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