Surveillance has been and will be intensified to detect vulnerabilities that may emerge in this period of uncertainty. As such, the financial institutions as well as the designated non-financial businesses and professions, or the DNFBPs, must be ready to respond to emerging risks and threats. These risks and threats include money laundering and terrorism financing that may undermine the efforts undertaken to maintain financial stability. For this purpose, it is apparent that the efforts to further strengthen the AML/CFT regime need to be intensified. Individual countries may benefit from robust AML/CFT regimes as enhanced financial sector integrity and stability facilitates their integration into the global financial system. They will also contribute to more transparent governance and effective fiscal administration. At the international level, there is renewed interest to review policies relating to banking secrecy and transparency, which are two of the factors identified to have contributed to the current financial meltdown. In this regard, the Financial Action Task Force (FATF) has initiated a study to assess the effectiveness of its policy tools in response to the current financial and economic crisis. The FATF is now identifying policy tools which may need further strengthening and evaluating whether new policy tools or responses may be needed to meet any new challenges. This is an opportunity for us to provide feedback to the FATF on its 40+9 Recommendations, including implementation challenges. Against this backdrop, the theme of this conference, “Strengthening Vigilance During Turbulent Times”, aptly describe what I believe should be considered by every institution during this challenging times.

This is further supported by the key content of the sessions covering the critical issues to be deliberated by the stakeholders involved in AML/CFT. II. Emerging trends and risks of money laundering and terrorism financing  It is a permanent battle to put in place a robust AML/CFT regime that could effectively deter and detect serious offence by removing the economic incentives attached to the crime. There will be continuous and sustained attempts to out-maneuver the AML/CFT system. For this, let me share some thoughts with you on the second theme of this speech, which is on the emerging trends of money laundering and terrorism financing in this region. Today, while the purpose and criminal intent remains unchanged, i.e., to disguise illegal proceeds as legitimate assets, the launderers are now using more complex structures and sophisticated methods to launder money and circumvent the preventive measures that has been put in place. Allow me to share four examples as follows: 1. It is observed that instead of the simple structuring of transactions (or smurfing), recent cases have highlighted the increasing use of third parties to layer the proceeds of crime to distance them from its origins. The setting up of front shops and complex trust accounts using nominees are some of the common tools increasingly being used by the perpetrators;  2. As reflected in the FATF Strategic Surveillance Survey 2008, there is also an increasing trend of criminals leveraging on technology advancements to further their activities.