Trade Finance, Fraud and Risk — a part of the book Singapore as an International Financial Centre by Dr Alexander Ressos.
Part H addresses the financing of trade, the frauds that shook the sector, and the legal regimes for money laundering, sanctions and enforcement.
This part belongs to Singapore as an International Financial Centre by Dr Alexander Ressos, published here in full, section by section.
Trade Finance in Singapore
A cargo of fuel oil loaded at a terminal on Jurong Island, a parcel of Indonesian thermal coal sold to a power plant in southern China, a shipment of palm oil bound for India: each of these… Read more Singapore · Trade Finance and RiskTransactional trade finance
The core idea of transactional trade finance is simple. Read more Singapore · Trade Finance and RiskBorrowing base and structured commodity finance
The large and medium-sized trading houses rarely finance their business transaction by transaction. Read more Singapore · Trade Finance and RiskThe role of the local and foreign banks
The three Singapore banking groups, DBS, OCBC and UOB, have deep roots in trade finance. OCBC descends from the Chinese banks of the early twentieth century, whose history Chapter B.III traces. Read more Singapore · Trade Finance and RiskDigitalisation of trade documents
International trade still runs largely on paper. A single shipment may require dozens of documents, many of them originals that must be couriered between continents. Read more Singapore · Trade Finance and RiskThe retreat of lenders after 2020
The year 2020 was the worst in the modern history of Singapore’s trade finance market. Read more Singapore · Trade Finance and RiskTrade Finance in Singapore: practical consequences
A trader seeking finance in Singapore today must expect scrutiny of its governance and controls that goes far beyond the review of a decade ago. Read more Singapore · Trade Finance and RiskTrade Finance in Singapore: Comparison with Geneva
Geneva and Singapore are the two leading centres of commodity trade finance outside London, with overlapping banks, instruments and case law. Read more Singapore · Trade Finance and RiskTrade Finance in Singapore: summary
Trade finance in Singapore rests on self-liquidating credit secured on goods: documentary credits, collections, trust receipts, guarantees and receivables. Read more Singapore · Trade Finance and RiskThe 2020 Collapses: Hin Leong, Agritrade and ZenRock
In the first half of 2020 three Singapore commodity traders collapsed within a few months of one another. Agritrade International, a palm oil and coal house, failed in February. Read more Singapore · Trade Finance and RiskHin Leong Trading
Hin Leong Trading, founded in 1963 by Lim Oon Kuin, grew from supplying diesel to fishing boats into one of Asia’s largest independent oil traders. Read more Singapore · Trade Finance and RiskAgritrade International
Agritrade International began in 1979 as a family-run palm oil trading firm and later expanded into coal. Read more Singapore · Trade Finance and RiskZenRock Commodities Trading
ZenRock was founded in Singapore in 2014 by a group of experienced oil traders, among them Xie Chun and Tony Lin. Read more Singapore · Trade Finance and RiskInsolvency, criminal proceedings and bank losses
In all three cases the courts used judicial management, the Singapore procedure in which an independent insolvency practitioner takes over the management of a company to preserve its business or… Read more Singapore · Trade Finance and RiskLessons for controls and due diligence
The authorities responded through the banking industry and avoided new legislation. Read more Singapore · Trade Finance and RiskThe 2020 Collapses: Hin Leong, Agritrade and ZenRock: the comparison with Geneva
The fraud cases of 2020 occurred in Singapore and Dubai, but their costs fell on banks in several financial centres, among them Geneva. Read more Singapore · Trade Finance and RiskThe 2020 Collapses: Hin Leong, Agritrade and ZenRock: summary
In the first half of 2020 Agritrade International, Hin Leong Trading and ZenRock Commodities Trading collapsed amid allegations that they had obtained bank finance with falsified accounts, forged or… Read more Singapore · Trade Finance and RiskAnti-Money Laundering: The CDSA, MAS Notices and the FATF Evaluations
A financial centre that accepts money from the whole world must be able to explain where that money came from. Singapore has built its answer in layers over more than three decades. Read more Singapore · Trade Finance and RiskThe Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act
The CDSA bears the year 1992 in its short title. Read more Singapore · Trade Finance and RiskMAS notices on customer due diligence
The CDSA tells everyone what not to do. The preventive obligations of financial institutions are found in a separate body of rules issued by MAS for each sector. Read more Singapore · Trade Finance and RiskSuspicious transaction reporting
The duty to report suspicions is a general obligation of the criminal law, laid down in section 45 of the CDSA. Read more Singapore · Trade Finance and RiskThe FATF mutual evaluations
Singapore joined the FATF in 1992, three years after its foundation. Read more Singapore · Trade Finance and RiskReforms after 2023
The arrests of 15 August 2023 and the seizure of assets worth more than three billion dollars, examined in Chapter E.VI, came shortly before the on-site visit of the FATF. Read more Singapore · Trade Finance and RiskAnti-Money Laundering: The CDSA, MAS Notices and the FATF Evaluations: practical consequences
For banks and other institutions, the reforms since 2023 mean that supervisors now examine the quality of implementation more closely than the existence of policies. Read more Singapore · Trade Finance and RiskAnti-Money Laundering: The CDSA, MAS Notices and the FATF Evaluations: Comparison with Geneva
Geneva and Singapore apply the same FATF Recommendations, but they started from different points. Read more Singapore · Trade Finance and RiskAnti-Money Laundering: The CDSA, MAS Notices and the FATF Evaluations: summary
Singapore criminalises money laundering in the CDSA, a statute of 1992 that now covers serious crimes committed at home or abroad, including tax crimes since 2013 and foreign environmental crimes… Read more Singapore · Trade Finance and RiskSanctions and Export Controls: UN Measures, Russia and Secondary Sanctions
A trading hub lives on the freedom of goods, ships and payments to move. Sanctions exist to stop some of them. Read more Singapore · Trade Finance and RiskUnited Nations sanctions in Singapore law
Singapore follows the dualist tradition of the common law. Read more Singapore · Trade Finance and RiskSingapore’s measures against Russia since 2022
Russia invaded Ukraine on 24 February 2022. Read more Singapore · Trade Finance and RiskUnited States and European sanctions and their reach
The official position is clear. Read more Singapore · Trade Finance and RiskShip-to-ship transfers, dark fleets and maritime risk
Singapore is the largest bunkering port in the world and one of the main centres for the storage and blending of oil, as Chapters G.II and G.III describe. Read more Singapore · Trade Finance and RiskStrategic goods control
The control of military and dual-use goods is older than the measures against Russia. Read more Singapore · Trade Finance and RiskSanctions and Export Controls: UN Measures, Russia and Secondary Sanctions: practical consequences
For banks, the Singapore law of sanctions is relatively simple. The commercial pressure of foreign sanctions adds most of the complexity. Read more Singapore · Trade Finance and RiskSanctions and Export Controls: UN Measures, Russia and Secondary Sanctions: Comparison with Geneva, Hong Kong and Dubai
The contrast with Geneva is clear. Read more Singapore · Trade Finance and RiskSanctions and Export Controls: UN Measures, Russia and Secondary Sanctions: summary
Singapore implements UN Security Council sanctions through the United Nations Act 2001, MAS regulations and trade controls administered by Singapore Customs. Read more Singapore · Trade Finance and RiskEnforcement: Corporate Liability, Deferred Prosecution Agreements and Cross-Border Cooperation
On 24 April 2026 the High Court of Singapore approved the first deferred prosecution agreement, between the Public Prosecutor and Seatrium Limited. Read more Singapore · Trade Finance and RiskCorporate criminal liability
Singapore’s criminal law does not contain a general provision dedicated to the criminal liability of companies. It reaches companies through definitions. Read more Singapore · Trade Finance and RiskDeferred prosecution agreements
Singapore’s first major resolution with a company for foreign bribery came before the deferred prosecution regime was available. Read more Singapore · Trade Finance and RiskMutual legal assistance and extradition
The Mutual Assistance in Criminal Matters Act 2000 (MACMA) is the principal statute for cooperation with foreign prosecutors. Read more Singapore · Trade Finance and RiskAsset recovery and confiscation
The CDSA allows the court, on the application of the Public Prosecutor, to make confiscation orders against persons convicted of drug dealing or serious offences. Read more Singapore · Trade Finance and RiskParallel proceedings in several jurisdictions
The Keppel case of 2017 is Singapore’s leading example of a coordinated resolution with several states. Read more Singapore · Trade Finance and RiskEnforcement: Corporate Liability, Deferred Prosecution Agreements and Cross-Border Cooperation: practical consequences
For a company based in Singapore, the main lesson of the Keppel and Seatrium cases is that self-reporting and cooperation determine the outcome. Both companies received a non-trial resolution. Read more Singapore · Trade Finance and RiskComparison with Geneva and other centres
Switzerland introduced corporate criminal liability on 1 October 2003 through what is now Article 102 of the Criminal Code. The Swiss rule is narrower and more specific than the Singapore approach. Read more Singapore · Trade Finance and RiskEnforcement: Corporate Liability, Deferred Prosecution Agreements and Cross-Border Cooperation: summary
Singapore law treats companies as persons capable of committing almost any offence and attributes to them the conduct of directors, employees and agents. Read more