After a rush of new single family offices setting set up in the city-state in recent years, there are signs that Singapore is intensifying scrutiny of the organisations which want to establish business there.

(Updates story with comments from MAS.)

Singapore has intensified scrutiny of Chinese wealth coming into the jurisdiction, including rejecting applications to set up family offices, NikkeiAsia reported.

The report, which quoted unnamed sources, said that since January the Monetary Authority of Singapore has denied two family office applications with Chinese-affiliated wealth. These include people who hold only a Chinese passport and those who hold additional foreign passports. 

The rejections were given in a written format but without a detailed explanation, as indicated by an email seen by the publication. 

"All applications for tax incentives from single family offices (SFOs) are assessed against a set of criteria, which include assets under management, number of investment professionals hired and an assessment of money laundering risks," a spokesperson for MAS said in an emailed comment to WealthBriefingAsia, when asked about the NA story. 

"The set of criteria applies to all applicants, regardless of nationality. Applicants that had failed to meet MAS’ criteria were rejected. This has always been the case. There have been rejections before the money laundering investigation in August. MAS continues to receive a steady stream of applications for tax incentives from SFOs. As of 31 December 2023, there were around 1,400 SFOs that have been awarded tax incentives," the regulator said.

As noted in this recent interview, the city-state’s regulator is taking longer to approve new family offices. 

While definitions of “family office” can be fuzzy at times, there are said to be about 700 family offices in Singapore. Banks such as DBS, for example, are tapping into the space. More than 59 per cent of Asia’s family offices are based in Singapore. Growth is driven by the rising affluence of the region and Singapore’s attractions as a relatively legally and politically safe jurisdiction. (It has sought to clarify and strengthen rules for SFOs, as reported here. It has also benefited to some degree from concerns about Hong Kong’s political direction in recent years.) That said, Hong Kong is also trying to compete as a centre for family offices along with other locations, such as Dubai, trying to attract SFOs. 

With growth comes a need for quality control. A report in November last year (the Financial Times) said that the global queue to set up a family office in Singapore has stretched to as long as 18 months.

The NA story said there has been at least one recent approval, from a non-Chinese national applicant.

MAS does not publish a breakdown of applications or rejections, the report noted.