Gap in current laws on money mules, only 9 of 120 suspects in OCBC scam charged: Josephine Teo

Teo also addressed the issue of people selling their Singpass credentials.

Matthias Ang | May 09, 2023, 05:15 PM

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It is necessary to recognise the limitations of current laws, which make it difficult to take money mules to task, Second Minister for Home Affairs Josephine Teo said in Parliament on May 8.

The minister was speaking at the opening of the second reading of the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) (Amendment) Bill and the Computer Misuse (Amendment) Bill.

She highlighted that between 2020 and 2022, scammers exploited more than 38,000 bank accounts to launder their proceeds from local victims, with 2022 alone seeing victims losing S$660 million.

Many money mules claimed they did not know they were handling illegal funds

Current laws require the prosecution to prove that the money mule had knowledge or reasonable grounds to believe that the money transacted through his bank account is linked to criminal activity.

However, one "big" problem for the police is that with electronic transactions, all of these happen very quickly, in a matter of hours.

In addition, a majority of the money mules, when interviewed by the police, claimed that they did not know they were handling illegal funds.

"They claimed not to have known the identity of the person who instructed them nor the identity of the bank account holders whom they were receiving funds from or transferring funds to.

Many agreed to facilitate these money transfers because they were paid to do so. They claimed that they did not think that they were doing anything illegal and did not know they were dealing with criminal proceeds."

Money moved beyond hope of recovery

The fact remains however, that their actions caused great harm to scam victims, whose money has been moved beyond the reach of recovery, Teo pointed out.

As a result of these difficulties, of the 19,000 money mules investigated by the police from 2020 to 2022, fewer than 250 money mules were eventually prosecuted.

With regard to the OCBC phishing scam that occurred between December 2021 and January 2022, in which 790 victims fell prey with losses amounting to S$13.7 million, Teo said that only 9 out of the 120 suspected money mules could be charged for offences.

Teo said: "Clearly, there is a gap that has allowed money mules to continue abetting scammers at little cost to themselves. Why should they be deterred if they can evade prosecution by simply claiming ignorance?"

People have also sold their Singpass accounts

It has also been similarly challenging to prove the wrongful intention of those who give up their Singpass credentials for abuse under existing laws like the Computer Misuse Act, Teo highlighted.

The minister said that apart from money mules, the police have also noticed a trend of also observed a trend of scam syndicates abusing Singpass to facilitate their criminal activities.

"For example, syndicates recruit Singpass users with the promise of monetary gain, and then use the Singpass accounts to further their schemes," she said.

Scam syndicates who get hold of another person’s Singpass credentials can use the details to open bank accounts, which are then used to receive and transfer funds obtained through scams.

Teo added, "Irresponsible Singpass users have facilitated this by selling or sharing their Singpass credentials, such as their Singpass password and SMS one-time password."

This has resulted in scam syndicates effectively assuming the identity of a Singpass user for their criminal activities, and exploiting the Singpass account to commit criminal activities while hiding their own tracks.

"As a result, these scam syndicates are extremely difficult to pursue," she said.

Amendments are meant to strengthen Singapore's collective defence against scams

The two sets of amendments being proposed are therefore intended to strengthen Singapore's collective defence against scams.

Teo elaborated that the amendments sets guardrails on the use of bank and Singpass accounts.

"Bank account holders and Singpass users must be careful and exercise diligence regarding their bank accounts and Singpass credentials.

Our bank accounts and Singpass accounts are for our own use. We should not allow them to be used by another person, especially if we do not know who the other party is or what the transactions are for."

The amendments will also empower the police to act more effectively against those who "blatantly" ignore these guardrails and abuse, or allow to be abused, their bank accounts and Singpass credentials to perpetrate scams and other crimes.

New offences, including rash and negligent money laundering, to be introduced

This includes introducing the offences of rash and negligent money laundering under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Bill.

According to Teo, a person can be liable for rash money laundering if he proceeded to carry out a transaction while he had some suspicions about the transaction, but did not make further enquiries to address those suspicions.

Such an offence will carry a fine of up to S$250,000 or a jail term of up to five years, or both.

As for negligent money laundering, a person can be liable if he continued with a transaction despite the presence of red flags or suspicious indicators, which would be noticeable by an ordinary, reasonable person.

This offence will carry a fine of up to S$150,000, a jail term of up to three years, or both.

"These changes will allow a money laundering offence to be made out against an individual at a lower level of culpability compared with current laws," she said.

A third offence that will be introduced pertains to assisting another person to retain benefits from criminal conduct.

A person can be deemed liable for this offence if his conduct falls under any of the following four circumstances:

  • The value of the property he dealt with is disproportionate to his known sources of income,
  • He allowed another person or persons to access, operate or control his payment account and failed to take reasonable steps to find out the purpose of this arrangement,
  • He received or transferred money using his payment account and failed to take reasonable steps to find out the source or destination of the money, or
  • He received money from or transferred money to another person and failed to take reasonable steps to find out that person's identity and physical location.

A person convicted of this offence can be fined up to S$50,000, jailed for up to three years, or be subjected to both.

Offences addressing deliberate disclosure of Singpass for criminal activities will also be introduced

A fourth offence will also be introduced, under the Computer Misuse Bill, to address the conduct of Singpass users who deliberately give their credentials to other persons, which are then used to facilitate criminal activities, Teo said.

It will be an offence for a SingPass user to disclose their credentials, if they did so knowing or having reasonable grounds to believe that the purpose of the disclosure is to commit an offence.

Teo clarified that while this change is not meant to make legitimate users of Singpass fearful of disclosing their credentials, they should be aware that disclosure is potentially an offence if they did so for their own gain, or they knew it would cause any wrongful loss to any person, or they failed to take reasonable steps to find out the identity and physical location of the person to whom the disclosure was made.

This offence will carry a fine of up to S$10,000 or imprisonment of up to three years, or both.

She reiterated:

"To be abundantly clear, it is not our intent to criminalise situations where there is a genuine need to share credentials for legitimate transactions. For instance, seniors may in some situations need the help of their family members to make Singpass transactions. The new provisions are also not intended to capture persons who were genuinely tricked into giving up their Singpass credentials."

Measure to deal with those who trade SingPass credentials for nefarious purposes

Another offence will also be introduced pertaining to the acts of obtaining, retaining, or dealing in another person’s Singpass credentials.

This is to deal with those who purchase Singpass credentials, and syndicates which trade Singpass credentials, Teo said. It won't be an offence to obtain another person's credentials for legitimate purposes.

A person convicted of this offence faces a fine of up to S$10,000 or imprisonment of up to three years, or both, for a first offence. For subsequent offences, the penalty will be a fine of up to S$20,000 or imprisonment of up to five years, or both.

In addition, these two offences under the Computer Misuse Bill will give the courts jurisdiction over these offences, even if they are committed outside Singapore.

"The nature of scam syndicates is that they operate mostly from overseas regardless of where these offences are committed. It is critical for us to prevent conduct that amounts to an abuse of Singpass to facilitate scams and other criminal activities and to protect Singapore's as Singapore's national digital identity service."

Goal of the bills is to have fewer money mules

In her closing speech on the bills, Teo noted that Workers' Party Member of Parliament Sylvia Lim had asked if prosecution rates of money mules will increase with the new offences.

In response, Teo said that the goal is not to increase the number of prosecutions per se, but to have far fewer money mules.

"If the introduction of the new laws deters individuals from acting as money mules in the first place, resulting in fewer being prosecuted, this will be a welcome development," she said.

Teo added that like Lim, she was not so sanguine however and said it is important to remain vigilant and be ready to up the ante.

Another question had also been posed by Nominated MP Janet Ang about the enforcement of the new laws, especially in light of the challenges posed by the transnational nature of scam syndicates.

Here, Teo said, "We will work with our international counterparts, though I am sure Members are familiar with some of the challenges of overseas enforcement."

More measures put in place by GovTech to ensure Singpass security

As for Singpass security, Teo said that the Smart Nation and Digital Government Group (SNDGG) has introduced measures to better protect Singpass users. This includes early detection measures by GovTech and fraud analytics to detect potential scams involving Singpass.

For higher risk transactions, users may also be asked to further verify themselves with Singpass Face Verification, Teo said. These measures allow GovTech to take prompt action to investigate, and where possible, prevent or stop the scams.

GovTech has also given users the option to block their Singpass from overseas access — a useful option as most scammers operate outside of Singapore, she added.

Such measures will also protect the vulnerable members of society.

"Red flags" that the public should look out for

Teo then highlighted that the public should be aware of the following tactics used by scammers to approach prospective victims:

  • Not presenting themselves in person but instead, connecting out of the blue through phone calls or video calls, claiming to help or being in need of help,
  • Giving fairly well-rehearsed reasons for the victim to let someone else use your account to receive or transfer monies.

    • Teo added that this should be cause for the public to ask why can't the person use their own account.

  • Providing various reasons for wanting your bank account login or Singpass details.

Such moves should set off alarm bells, Teo said.

She then elaborated should a person be told that something very bad has happened to them or their loved ones, they should pause and think.

"Scammers love to make people panic, because that is when we lose our best judgment," she said.

On the other hand, if a person is told something that is "too good to be true" they should also pause and think as scammers know that "know that greed makes fools of geniuses."

"The bigger the amount at stake, the more carefully you should proceed," she said.

She reiterated:

"We must be vigilant and take proper care of our payment accounts and Singpass accounts. At the same time, it is not our intention to penalise those who were genuinely tricked into giving up control of their bank accounts or disclosing their Singpass credentials, or those who needed help from their family members or friends, and subsequently had their trust betrayed."

Top screenshot from CNA