On 9 May 2023, the Financial Services and Markets (Amendment) Bill (“Bill“) was passed in Parliament. The Bill amends the Financial Services and Markets Act 2022 to introduce the legislative framework for a secure digital platform named COSMIC (short for “Collaborative Sharing of ML/TF Information & Cases”) to allow financial institutions (“FIs“) to conduct sharper analysis of suspicious customer behaviours/activities to detect potential illicit activities and for FIs to warn each other of such activities.
Key features of the Bill include:
• Information sharing only permitted to mitigate money laundering, terrorism financing, and proliferation financing risks, and when objective thresholds are met.
• Fls will be provided with statutory protection from civil liability regarding their disclosure of risk information on COSMIC, subject to the disclosure having been made with reasonable care and in good faith, and in accordance with the disclosure thresholds.
• Protection for Legitimate Customers. Before sharing information on COSMIC, FIs must perform risk assessment to discover if there are valid reasons for the customer’s behaviour/profile and give customers the opportunity to address the bank’s risk concerns.
• Safeguards on the use of and access to information on COSMIC. FIs will be prohibited from disclosing the information obtained from COSMIC except in certain specified circumstances, for instance to comply with Court orders or requests from the police to facilitate investigations.
• Access and use of COSMIC information by the Monetary Authority of Singapore (MAS) and the Suspicious Transaction Reporting Office for anti-money laundering/countering the financing of terrorism (AML/CFT) purposes.
For more information, click here to read the full Legal Update.
