The challenge of distinguishing legitimate investment funds from illicit terrorism funds has persisted for decades, and Singapore's accountants are set to be on the front lines of this conflict.

Singapore's appeal as a financial center and its ease of business setup and operation are major factors attracting international investment. Nevertheless, criminals keep coming up with new ways to get around the law.

The nation's new Corporate Service Providers Bill, which was approved by parliament in July 2024 but hasn't yet been implemented, will act as a counterbalance. In order to continue operating in this industry, a variety of service providers will need to formally register.

It will be mandatory for registered corporate service providers (CSPs) to do due diligence on the parties they serve. If not, the corporate service provider must take specific actions, including terminating any services provided to the party in question and reporting suspicious transactions to the appropriate authorities in compliance with the law.

The move will place accountants at the forefront of the worldwide effort to curb the funding of terrorists, proliferation, and money laundering.

Why CSPs? The primary conclusion of Singapore's June 2024 national risk assessment on money laundering was that the nation's biggest money laundering problems were fraud, particularly domestic and international cyber-enabled fraud, which is orchestrated by criminal syndicates that are often headquartered overseas.

In light of this, the government has made CSPs a primary focus of the nation's anti-money laundering system. In addition to industries like real estate, casinos, licensed trust companies, and the precious stones and metals sector, the national risk assessment states that CSPs are more dangerous due to their involvement in upstream services like company incorporation and that they are occasionally connected to the abuse of legal persons.