Upcoming changes to bolster detection and deterrence of money laundering, terrorism financing, and proliferation financing in real estate sector

29 April 2025

The Anti-Money Laundering and Other Matters (Estate Agents and Developers) Act 2025 (“Act”) has been gazetted and will come into operation on a date to be appointed. The Act is part of continuing efforts to bolster Singapore’s ability to detect and deter money laundering (“ML”), terrorism financing (“TF”), and financing of the proliferation of weapons of mass destruction (“PF”) within the real estate sector. These measures will reinforce Singapore’s commitment to stamp out the laundering of criminal proceeds and financing of illicit activities through Singapore.

The Act will (i) strengthen current penalty frameworks; (ii) further align the regulatory regime with standards set by the Financial Action Task Force (“FATF”); and (iii) clarify certain restrictions against convicted persons.

Details of the upcoming changes, as explained in the speech delivered on 8 April 2025 at the second reading of the Anti-Money Laundering and Other Matters (Estate Agents and Developers) Bill (“Bill”), are set out below.

Strengthening penalty frameworks

Prescribe maximum financial penalties for estate agents and salespersons on a “per contravention” instead of “per case” basis

Estate agents and salespersons are required to perform duties in relation to countering ML and TF activities, e.g. salespersons conducting customer due diligence on their clients. The current penalty framework which allows financial penalties to be imposed on a per case basis does not provide sufficient deterrence as the potential monetary benefits that estate agents and salespersons might obtain for facilitating illicit transactions could be significantly higher than the maximum financial penalties.

Currently, a financial penalty of up to S$5,000 per case may be imposed on non-compliant estate agents and salespersons for minor breaches under the Council for Estate Agent (“CEA”) Letter of Censure disciplinary regime. For more serious breaches, a Disciplinary Committee comprising members from CEA’s Disciplinary Panel may impose a financial penalty of up to S$200,000 per case on estate agents or S$100,000 per case on salespersons.

To ensure the penalty frameworks are sufficiently deterrent, the Estate Agents Act 2010 (“EAA”) will be amended to impose additional maximum financial penalties on a per contravention basis. Estate agents and salespersons who contravene any legislation or provision of a code of practice, ethics, and conduct relating to ML, TF, or PF will be subject to a maximum penalty of up to S$5,000 per contravention under the CEA Letter of Censure regime. For cases heard by a Disciplinary Committee, errant estate agents and salespersons will be subject to a maximum penalty of up to S$200,000 and S$100,000 per contravention respectively.

Maximum penalties for other disciplinary breaches will remain on a per case basis.

Increase maximum composition sums for housing developers and introduce composition framework for commercial/industrial developers

Like estate agents and salespersons, developers are required to perform duties to counter ML and TF activities. Currently, for less serious offences, non-compliant housing developers may be offered composition of up to S$5,000 under the Housing Developers (Control and Licensing) Act 1965 (“HD(CL)A”). This is significantly lower than the maximum fine for ML and TF offences, at S$100,000 per offence upon conviction. To strengthen deterrence, the HD(CL)A will be amended to raise the maximum composition sum from S$5,000 to 50% of the maximum fine prescribed for the offence. Hence, the maximum composition sums for some offences will be increased to S$50,000.

The Sale of Commercial Properties Act 1979 (“SCPA”) will be amended to allow offences by commercial and industrial developers to be compounded. The maximum composition sum under the SCPA will be up to 50% of the maximum fine prescribed for the offence.

Alignment with updated FATF standards

The amendments in the Act will further align Singapore’s regulatory regime with international standards set by the FATF.

  • Estate agents and salespersons to conduct due diligence measures on unrepresented counterparties: Currently, estate agents and salespersons are only required to conduct due diligence measures on their own clients. To align with FATF standards, the EAA will be amended to require them to conduct due diligence measures on unrepresented counterparties of property transactions.
  • Estate agents, salespersons, and developers must consider PF risks: The FATF has updated its standards to clearly set out the standards to identify, assess, and mitigate risks associated with PF. The Act will update the regulatory regime for estate agents, salespersons, and developers to encompass PF. The amendments to the composition regime for developers will also allow PF offences to be compounded.
  • Clarify that measures for developers relating to targeted financial sanctions apply to TF and PF in addition to terrorism: The HD(CL)A and SCPA will be amended to require developers to perform prescribed measures related to targeted financial sanctions for TF and PF, in addition to terrorism. Currently, developers are required to assess whether a purchaser is designated as a terrorist or terrorist entity under relevant lists or sanctioned by the United Nations. If so, developers must decline to enter into or terminate transactions with the potential purchaser, and report the matter to the Police. The amendments will make clear that this requirement also applies to purchasers who are on the designated or sanction lists due to TF and PF.

Clarifying restrictions against convicted persons

The Act clarifies that persons who have been convicted of ML, TF, or PF offences, whether committed in Singapore or overseas, are not deemed fit and proper to hold an estate agent licence, or a salesperson registration under the EAA, given the seriousness of such offences.

The HD(CL)A and SCPA will be amended to clarify that ML, TF, or PF offences include offences under the law of any foreign country or territory. Persons convicted of such offences regardless of where they are committed will be subject to prohibitions against (i) becoming a housing developer; (ii) becoming a substantial shareholder; or (iii) holding a responsible position in a developer or in substantial shareholders of a developer.

Reference materials

The following materials are available on Singapore Statutes Online sso.agc.gov.sg and the Ministry of National Development website www.mnd.gov.sg: