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Money Laundering Methods used by Singaporeans and their corrupt counterparts.

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PNGMK
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Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 8:30 am

This is not meant to encourage criminal activity but I see a lot of money laundering around Singapore and I find it quite entertaining. Most of this appears to be hiding money from IRAS (income in cash that they don't want taxes) but there are also people hiding money from spouses in divorces or money from illegal activities. There are also people desperately trying to move money in or out of different countries without the government being aware of it.

Some of the scheme I am aware of;

Car scrapping. By a car near end of life for cash, scrap it and voila - you have a nice cheque from LTA

SPA shops. Take over a shophouse, put a few massagers inside and suddenly you have a business that can take lots of cash, pay some invoices and basically show a cash return (from other activities) without too much oversight by the CPIB or IRAS. If the business runs at a loss or near loss - no tax to pay

Over-invoicing requests. This ones seems to be done by people trying to pull money out of their own business without partners or spouses knowing. The idea is to ask a supplier or contractor to overcharge and when their payment clears to hand some cash back. Also common with reno loans - not really money laundering though in that case.

Casino. I recently became aware of how a certain overseas client get their bribes paid. They show up at MBS regularly and somehow get given chips in the Casino by a friend (easy enough). They can cash out and claim a 'win'.

Child or other party income splitting. As IRAS income tax rates have risen I see this happening more - quite common where I come from. The idea is the party being paid asks for the income to be split or paid in full to a party who has a lower tax rate (i.e. a spouse or child).

Pay in cash only or pay to overseas account. Not so common as cash withdrawals and movements are attracting scrutiny now even more so since IMDB.

Buying a winning Toto ticket (or 4D). An old scheme. Not sure if it still happens much. In the 80's and 90's you could sell a winning ticket for a 20/30 point profit to touts waiting at the Toto place. The idea is they could take cash and turn it into a 'toto' win and clean it. OF course the person with the cash eventually also has a problem.

Running a money changer or remittance agent. Recently some of these guys have been caught bringing in hundreds of thousands of dollars cross border. As an old CPA friend remarked; 'those main street money changers are all just fronts for drug lords' when we were walking around London.

Any others? For science of course.
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Wd40 » Mon, 04 Dec 2017 8:37 am

Havala: For example, I need to bring money out of India. I have friends here who want to remit money to India. We do a net off. I pay my friends from my Indian account in rupees and my friends pay me here in dollars. We do this transaction at slightly above xe.com rate so they are happy because they get a better rate and I am happy because I can get money out of india, which is not impossible the legal way, but quite a hassle.

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 8:38 am

Wd40 wrote:Havala: For example, I need to bring money out of India. I have friends here who want to remit money to India. We do a net off. I pay my friends from my Indian account in rupees and my friends pay me here in dollars. We do this transaction at slightly above xe.com rate so they are happy because they get a better rate and I am happy because I can get money out of india, which is not impossible the legal way, but quite a hassle.

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Is Havala licensed in Singapore at all? I am aware of that as well. Thanks. I guess you mean a private Havala arrangement rather than via a Havala agent.
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Wd40 » Mon, 04 Dec 2017 8:41 am

PNGMK wrote:
Wd40 wrote:Havala: For example, I need to bring money out of India. I have friends here who want to remit money to India. We do a net off. I pay my friends from my Indian account in rupees and my friends pay me here in dollars. We do this transaction at slightly above xe.com rate so they are happy because they get a better rate and I am happy because I can get money out of india, which is not impossible the legal way, but quite a hassle.

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Is Havala licensed in Singapore at all? I am aware of that as well. Thanks. I guess you mean a private Havala arrangement rather than via a Havala agent.
Yes private, within known people.

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Last edited by Wd40 on Mon, 04 Dec 2017 8:41 am, edited 2 times in total.

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Wd40 » Mon, 04 Dec 2017 8:43 am

There is bitcoin of course. The best way to move money out from one country to another. I heard you can buy bitcoin in India using rupees and then sell it here in dollars.

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Strong Eagle » Mon, 04 Dec 2017 1:03 pm

Wd40 wrote:I heard you can buy bitcoin in India using rupees and then sell it here in dollars.


Using what exchange rates?

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Wd40 » Mon, 04 Dec 2017 1:49 pm

Strong Eagle wrote:
Wd40 wrote:I heard you can buy bitcoin in India using rupees and then sell it here in dollars.


Using what exchange rates?
You buy bitcoin in an Indian bitcoin exchange, using rupees and then transfer it to a wallet and then sell from that wallet using SG exchange and get paid in dollars. There is no exchange rate involved. But, currently the price of bitcoin is so volatile, that the sell price can vary widely compared to the buy price.

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby okonu » Mon, 04 Dec 2017 2:30 pm

Also for paying (low level) bribes:

Buy expensive business/ first class ticket for cash for the person for a business trip. They then downgrade/ rebook themselves to economy class, and take the refund as cash. Company has a legit invoice for the business class ticket, so all looks good to the auditors.

Singapore real estate... There is a reason why Singapore still hasn't agreed an extradition treaty with our friends to the south.

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 2:36 pm

Wd40 wrote:
Strong Eagle wrote:
Wd40 wrote:I heard you can buy bitcoin in India using rupees and then sell it here in dollars.


Using what exchange rates?
You buy bitcoin in an Indian bitcoin exchange, using rupees and then transfer it to a wallet and then sell from that wallet using SG exchange and get paid in dollars. There is no exchange rate involved. But, currently the price of bitcoin is so volatile, that the sell price can vary widely compared to the buy price.

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You try to do it instantly or almost instantly then?
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 2:37 pm

okonu wrote:Also for paying (low level) bribes:

Buy expensive business/ first class ticket for cash for the person for a business trip. They then downgrade/ rebook themselves to economy class, and take the refund as cash. Company has a legit invoice for the business class ticket, so all looks good to the auditors.

Singapore real estate... There is a reason why Singapore still hasn't agreed an extradition treaty with our friends to the south.


OK business tickets I get (and I had missed - the same thing applies to hotels etc and of course gift cards or whatever - however FCPA just limit these so if it's a US company no go).

How does the real estate money laundering work? Transfer for nominal price? CGT would stop that.
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 2:39 pm

1. I forgot one I heard of a long time ago. Buying a terminally ill person's life policy in cash for making you a beneficiary (for a massive discount of course).
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby okonu » Mon, 04 Dec 2017 3:01 pm

Sorry, what I mean is that Singapore real estate is the final destination of a lot of laundered/ offshore cash. No one asks too many questions about the origin of the money, and traditionally Singapore hasn't co-operated too closely with overseas tax offices, unless they are American. Lots of upmarket SG condos owned by foreigners either directly or via companies.

I remember in the 98 crisis banking friends tearing their hair out. Clients happily declaring default, when they knew they had 10's of millions with the same bank in Singapore that they had siphoned off, but 'chinese walls' meant that they weren't meant to know that

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby okonu » Mon, 04 Dec 2017 3:20 pm

Gold bullion. Either buy here or abroad in cash, then sell here for bank transfer. You can bring in half a kilo for personal use without needing to declare it. Who is to say that the gold bullion isn't family heirlooms you have had for ever...?

Back in the bad old days - Nestle bearer shares...

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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby PNGMK » Mon, 04 Dec 2017 7:52 pm

okonu wrote:Gold bullion. Either buy here or abroad in cash, then sell here for bank transfer. You can bring in half a kilo for personal use without needing to declare it. Who is to say that the gold bullion isn't family heirlooms you have had for ever...?

Back in the bad old days - Nestle bearer shares...


500g x $60 = $30,000 - not as much as I'd have thought but the transfer part is nice. Bearer shares are long gone of course.

I can see the sudden interest in bitcoins.
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Re: Money Laundering Methods used by Singaporeans and their corrupt counterparts.

Postby Wd40 » Mon, 04 Dec 2017 7:56 pm

PNGMK wrote:
okonu wrote:Gold bullion. Either buy here or abroad in cash, then sell here for bank transfer. You can bring in half a kilo for personal use without needing to declare it. Who is to say that the gold bullion isn't family heirlooms you have had for ever...?

Back in the bad old days - Nestle bearer shares...


500g x $60 = $30,000 - not as much as I'd have thought but the transfer part is nice. Bearer shares are long gone of course.

I can see the sudden interest in bitcoins.
We need a bitcoin thread.

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