Response to the reduction of the COS on the bank accounts of ex-offenders
For Parliament sitting on 2 March 2022
Member’s name and constituency
Gerald Giam Yean Song, Aljunied RCMP
Several residents have approached me for help opening bank accounts. They had been rejected by banks because of their involvement in financial crimes.
They moved on and found decent jobs. However, they are unable to open a bank account for their salary deposits. Employers are generally unwilling to deposit into family members’ bank accounts and are unwilling to pay them cash. They are also unable to receive government cash benefits such as GST vouchers.
I understand that MAS works with major retail banks to improve financial inclusion by opening limited use bank accounts for people who the banks believe are at higher risk of being involved in financial crime. What will be the functions of these limited use bank accounts?
When will these limited-use bank accounts be generally available and will they be extended to ex-offenders, people under investigation or on trial?
Response from Mr. Lawrence Wong, Deputy Chairman of MAS and Minister of Finance, on behalf of Mr. Tharman Shanmugaratnam, Minister of State and Minister responsible for MAS:
1 Last year, MAS engaged major retail banks
2 The features and guarantees of limited-use bank accounts are designed to allow individuals to meet their basic banking needs, such as receiving salaries and paying bills. In order to limit the risk of abuse, the accounts are subject to reinforced surveillance measures. For example, banks will verify that individuals only receive funds from specific sources that were agreed upon when opening the account, including employer salary payments, government disbursements, and insurance payments. These features and guarantees will be adjusted if necessary after the current pilot.
3 Limited use bank accounts will meet the needs of most ex-offenders and those under investigation or charged. However, there may be a small number of individuals that banks have assessed as presenting unacceptable risk. For example, individuals who have committed serious crimes involving the violation of targeted financial sanctions.
4 MAS will continue to work with the Singapore Police on other ways to enable financial inclusion for those involved in financial crime, while ensuring that risks are properly managed.