Vistra said it has remediated the problems, as demonstrated via a third-party review.

The Monetary Authority of Singapore has slapped a S$1.1 million ($816,970) penalty on Vistra Trust (Singapore) Pte Ltd for not complying with anti-money laundering and counter-terrorism finance rules.

An MAS inspection carried out from April 2019 to June of that year uncovered “serious breaches” of MAS’ AML/CFT requirements for trust companies by VTSPL, placing it at “a higher risk of being used as a conduit for illicit activities,” the watchdog said in a statement yesterday.

VTSPL has paid the penalty and taken remedial actions to address the risk management deficiencies that led to the breaches, MAS said. 

The failures were particularly in relation to higher risk trust relevant parties, such as the settlor, the beneficiary, the trustee, and any person who has power over the disposition of a trust property,” the regulator said. 

VTSPL did not implement adequate procedures to determine whether trust relevant parties presented a higher risk for money laundering or terrorism financing. This resulted in VTSPL failing to identify certain higher risk accounts and subjecting these accounts to enhanced customer due diligence (CDD) measures, both during account acquisition as well as on an ongoing basis, it continued. 

The regulator said that VTSPL also failed to perform adequate enhanced CDD for some accounts that had been identified as being of higher risk. Specifically, VTSPL did not establish the settlors’ source of wealth and source of funds and failed to obtain VTSPL’s senior management’s approval to establish or continue business contact with these higher risk accounts.

In a statement on its website, Vistra said: “All findings raised by the MAS are fully and satisfactorily remediated, as validated through an independent third-party review. VTSPL has put in place a robust governance and risk management framework and continues to invest in and strengthen its processes.”

“Vistra is committed to conducting business in accordance with all applicable laws and regulations in the 46 markets where we have a presence. With over 5,000 professionals across Asia-Pacific, EMEA and the Americas, managing 200,000 legal entities, our internal frameworks are based on the laws, and regulations in the jurisdictions in which we operate. These help us identify the relevant regulatory requirements and implement robust procedures to meet these requirements,” it said. 

MAS said it has directed VTSPL to appoint an independent party to validate the adequacy and effectiveness of its remediation measures and report its findings to MAS.