SINGAPORE – More muscle to prevent unsuitable individuals from working in the finance industry and strengthen the framework for technology risk management are among new proposals made by the Monetary Authority of Singapore (MAS) to deal with risks that can undermine the sector.
It issued a consultation paper proposing such enhanced powers on Tuesday (July 21).
The proposed new Act for financial services and markets will consolidate similar provisions for various classes of financial institutions in the MAS Act into a single legislation.
The new Act will enable MAS to expand its power to issue prohibition orders to preserve trust and deter misconduct in Singapore’s financial sector, it said.
This will broaden the categories of individuals who may be subject to such orders, rationalise the grounds for issuing the orders from a list of specific criteria into a single fit and proper test, and widen the scope of prohibition.
The authority said: “The new powers will enable MAS to holistically assess whether a person’s misconduct renders him unsuitable to perform one or more roles or activities within the financial sector and the appropriate action that should be taken under the prohibition order powers.”
MAS also proposed to expand the scope of requirements for anti-money laundering and countering the financing of terrorism to those in Singapore who provide digital token services overseas.
Existing legislation already regulates digital token services provided in Singapore. The new provisions will align Singapore’s regime with the enhanced standards adopted by global watchdog, the Financial Action Task Force.
MAS also suggested that it harmonises and expands its existing powers to impose requirements that are related to technology risk management on all regulated financial institutions.
This includes cyber-security risks and data protection, to deal with the pervasive use of technology and the growing sophistication of cyber threats.
It proposes to raise the maximum penalty for contravening technology risk requirements to $1 million.
MAS also proposed to provide statutory protection to those in dispute resolution, such as mediators, adjudicators and employees of the Financial Industry Disputes Resolution Centre.
“This will strengthen their confidence to act independently in resolving consumers’ disputes with financial institutions,” MAS said.