SINGAPORE — A director and compliance manager of Samlit Moneychanger in Chinatown are being investigated for their suspected involvement in carrying on a business for a fraudulent purpose, and their suspected failure in complying with various obligations as a licensed payment services provider.

The police and the Monetary Authority of Singapore (MAS) said in a statement on Friday (Feb 23) that the director is a 43-year-old woman, while the compliance manager is a 34-year-old man.

MAS added that it has also taken steps to secure the funds in Samlit’s corporate bank accounts, including directing the firm to seek approval for any fund withdrawals and transfers. 

The funds that have been secured are sufficient to meet Samlit’s uncompleted remittance obligations, MAS said.

Last December, the police said that they had received 430 reports made against Samlit Moneychanger for remittances made to China which were frozen by the authorities there.

Following reports to the authorities that beneficiaries in China of these remittance transactions were unable to access the remitted monies, MAS commenced an inspection of Samlit.

“Samlit, however, has not been forthcoming in providing the information required by MAS and has not satisfactorily explained the purported remittance fund flows,” said the joint statement on Friday.

While MAS’ inspection was ongoing, Samlit notified MAS on Feb 20 of its intention to surrender its payment services licence and discontinue its business.

The authorities also then received reports about “unusual transfer activities” in Samlit’s corporate bank accounts and its director’s personal bank account.

In light of these developments, the police and MAS said they launched a joint investigation on Samlit on Friday.

The authorities emphasised in their joint statement that these investigations were separate from, and do not affect, any potential private claims by remitters against Samlit. 

“In the meantime, MAS has directed Samlit to continue to provide relevant documentation to affected remitters to facilitate their appeal to law enforcement agencies in China regarding the unfreezing of their beneficiaries’ accounts, even after the surrender of its licence,” they said, adding that Samlit remains a licensee until Feb 29.

“MAS regrets that Samlit has not taken a more responsible course of action but has chosen to surrender its licence at this time."

The central bank of Singapore also directed Samlit to ensure that beneficiaries of uncompleted remittance transactions receive the funds within seven business days – even after it surrenders its licence.

If the funds are not received by a beneficiary within seven business days, Samlit is required to contact the remitter immediately for further instructions, the authorities said.

The firm is also required to “properly discharge” all outstanding obligations, including making “adequate provisions for unforeseen liabilities”, before winding down.

“The authorities understand the frustrations faced by the affected remitters and urge the affected remitters to seek redress within the legal framework of Singapore,” said the police and MAS.

Nevertheless, the police will not hesitate to take enforcement action against anyone who breaks the law in Singapore, including the organisation of or participation in a public assembly without a police permit, they said. 

This weekend, the Government will be reaching out to affected remitters who used Samlit to provide them with more information on the situation.

A person convicted of fraudulent trading can be failed for up to seven years, fined up to S$15,000, or both.

Failure to comply with obligations as a licensed payment services provider attracts a jail term of up to one year, a fine of up to S$1 million – with further fines for continuing offences, if applicable – or both.