Perhaps, unsurprisingly, banks operating in Singapore are tightening scrutiny of their clients in the wake of the largest money laundering case in the Asian city-state's history. Fines and other punitive measured are expected.

Citigroup, DBS and other banks caught up in a major money laundering case in Singapore are tightening scrutiny of their wealthy customers and potential clients, Bloomberg has reported, citing unnamed sources.

The report (10 June) said private bankers at several institutions are also receiving additional training to help them spot tricks used by criminals to mask their backgrounds and sources of funds.

The banks’ moves, which are voluntary, demonstrate how firms are trying to ensure the kind of conduct that saw a group of criminals from China launder more than S$3 billion ($2.23 billion) does not recur. The criminals laundered proceeds from online gambling through at least 16 financial institutions in Singapore. 

A report last week said the case covers 27 people, and not only the 10 persons brought to court on various charges.

This isn’t the first time Singapore – along with other hubs such as Switzerland and the US – have been hit by money laundering scandals. Just under a decade ago, the wealth sector witnessed the multi-billion saga of funds that were siphoned off from the 1MDB fund created by the Malaysian government. Banks in Singapore were among those affected.

The news service’s report said that the Monetary Authority of Singapore recently completed on-site inspections of some banks that were involved.

Firms that had the most dealings with the criminals – through deposit accounts, loans and other financial services – are expected to face fines and other punitive measures from the financial regulator after its review concludes, the report said, citing its sources.

The MAS will check if the financial institutions have implemented adequate and appropriate controls against money laundering and terrorism financing. The regulator will act if firms have fallen short of requirements, as it has done in past cases, a MAS spokesperson told Bloomberg.