Statute Details
- Title: Precious Stones and Precious Metals (Prevention of Money Laundering, Terrorism Financing and Proliferation Financing) Act 2019
- Full Title: An Act to regulate persons who carry on a business of regulated dealing or as intermediaries for regulated dealing, so as to prevent money laundering, terrorism financing and the financing of proliferation of weapons of mass destruction.
- Act Code: PSPMPMLTFPFA2019
- Type: Act of Parliament
- Status / Version: Current version as at 27 Mar 2026 (with amendments including Act 6 of 2024 effective 1 May 2024)
- Legislative History (high level): Act 7 of 2019 (10 Apr 2019); 2020 Revised Edition (31 Dec 2021); amended by Act 18 of 2022 (28 Apr 2023); amended by Act 6 of 2024 (1 May 2024)
- Key Structure: Part 1 Preliminary; Part 2 Registration of Regulated Dealers; Part 3 AML/CFT/CPF (customer due diligence, reporting, records, programmes, sanctions); Part 4 Monitoring & Enforcement; Part 5 General Offences; Part 6 General
- Key Provisions (as provided): s 4 (appointment of Registrar and authorised officers); s 5 (authorised officers treated as public servants)
- Schedule: Specifies “precious metals and precious stones” covered by the regime
What Is This Legislation About?
The Precious Stones and Precious Metals (Prevention of Money Laundering, Terrorism Financing and Proliferation Financing) Act 2019 (“the Act”) is Singapore’s targeted anti-financial crime framework for the precious stones and precious metals sector. In plain terms, it regulates businesses that deal in specified precious metals and precious stones (and certain related products) by requiring them to register with the authorities and to implement controls designed to prevent their services from being used to launder money, finance terrorism, or facilitate proliferation of weapons of mass destruction.
Unlike general financial services legislation that applies broadly to banks and other financial institutions, this Act focuses on a specific industry where value can be transferred through high-value, portable assets. Precious metals and stones can be used to store and move wealth outside conventional banking channels, and that creates a risk that criminals may exploit the sector to disguise the origin of funds or to move value in support of illicit activities.
The Act therefore combines (i) a licensing/registration gatekeeping model for “regulated dealers” and certain intermediaries, with (ii) operational compliance obligations—such as customer due diligence, cash transaction reporting, record-keeping, internal programmes, and suspicious transaction disclosure—together with (iii) monitoring and enforcement powers, including investigation and seizure-related mechanisms.
What Are the Key Provisions?
1) Registration of regulated dealers (Part 2)
The Act establishes a baseline requirement that there can be no “regulated dealing” without registration. Section 6 is the core gatekeeping provision: if a person carries on regulated dealing (or acts as an intermediary for regulated dealing, depending on how the Act defines the relevant activities), they must be registered. This is a regulatory threshold; operating without registration is not treated as a mere technical breach.
Registration is not automatic. Sections 7 and 8 address the process of obtaining and renewing registration and the grounds for refusing to grant or renew it. In practice, these provisions allow the Registrar to assess suitability and compliance readiness. The Act also sets out conditions of registration (s 9), which can be used to impose specific compliance requirements tailored to the risks of the sector. There is also a mechanism for lapse of registration (s 9A), which is important for practitioners because it affects continuity of lawful operations—particularly where renewal is missed or conditions are not met.
2) AML/CFT/CPF controls: customer due diligence, reporting, records, and internal programmes (Part 3)
Part 3 is the operational heart of the Act. Section 14 limits the application of Part 3 to the relevant regulated dealing context, while s 15 provides interpretation for that Part. The key compliance obligations include:
• Customer due diligence (s 16): Regulated dealers must apply customer due diligence measures. In a lawyer’s terms, this is the Act’s risk-based “know your customer” requirement. The precise steps (e.g., identity verification, beneficial ownership considerations, and enhanced due diligence triggers) are typically implemented through the Act’s definitions and any subsidiary instruments, codes of practice, or guidelines referenced in Part 6. The practical point is that the Act expects dealers to understand who their customers are and to assess the risk that a transaction could be linked to money laundering, terrorism financing, or proliferation financing.
• Cash transaction reports (s 17): The Act requires reporting of certain cash transactions through “cash transaction reports”. This is a classic AML tool: cash is often used to avoid traceability, so mandatory reporting creates a dataset for analysis by enforcement and intelligence units. For compliance teams, the challenge is to ensure that reporting thresholds, timing, and content requirements are met accurately.
• Keeping of records (s 18): Dealers must keep records of customer due diligence and transaction-related information. Record-keeping is essential both for internal audit and for responding to regulatory requests. From a litigation and enforcement perspective, record-keeping provisions are often where evidentiary disputes arise (e.g., whether a dealer can demonstrate that due diligence was performed at the relevant time).
• Programmes and measures (s 19): Regulated dealers must implement internal programmes and measures to prevent money laundering, terrorism financing, and financing of proliferation of weapons of mass destruction. This typically includes governance arrangements, staff training, risk assessment, and procedures for reporting and escalation. The Act also aligns with international standards such as the FATF Recommendations, which are referenced in the definitions.
• Targeted financial sanctions (s 20): The Act includes additional measures relating to targeted financial sanctions. This is significant because sanctions compliance often requires screening customers and counterparties against designated lists, freezing or refusing transactions where required, and documenting decisions. Practitioners should treat s 20 as a bridge between AML/CFT obligations and sanctions regimes.
• Disclosure of suspicious transactions (s 21): Dealers must disclose suspicious transactions, etc. This provision is central to the “suspicion reporting” model. It requires a dealer to make a disclosure where there are reasonable grounds to suspect that transactions may relate to the relevant offences (money laundering, terrorism financing, or proliferation financing). The legal risk for dealers is twofold: failing to disclose can lead to enforcement action, while over-disclosure without proper internal processes can create operational burdens and potential confidentiality issues.
• Power to give directions (s 22): The Registrar or authorised officers may issue directions to regulated dealers. This allows the regulator to respond to evolving risks and to specify compliance expectations beyond the statutory baseline.
3) Monitoring, investigation, and seizure powers (Part 4)
Part 4 provides the enforcement machinery. Sections 23 and 24 confer powers of monitoring and investigation. These powers are designed to verify compliance with registration and Part 3 obligations, and to investigate suspected breaches.
Sections 25 and 26 address seizure of property in certain circumstances and the power of the court over seized property. For practitioners, these provisions are important because they affect how quickly the State can intervene and what procedural safeguards exist. Even where a dealer is not ultimately found liable, seizure powers can have immediate commercial consequences (e.g., disruption of inventory, cash holdings, or proceeds connected to transactions).
4) General offences (Part 5)
Part 5 creates offences that support the enforcement regime. Notably:
• False information (s 27): Providing false information to the Registrar or an authorised officer is an offence. This is particularly relevant in registration applications, renewal processes, and regulatory responses.
• Obstruction (s 28): Obstructing an investigation or similar conduct is criminalised. This provision underscores that compliance is not only about internal controls but also about cooperation with regulatory inquiries.
How Is This Legislation Structured?
The Act is organised into six parts:
Part 1 (Preliminary) sets out the short title, interpretation, purpose, and the appointment framework for the Registrar and authorised officers. It also clarifies that authorised officers are treated as public servants for certain legal purposes (s 5), which supports the exercise of statutory powers.
Part 2 (Registration of Regulated Dealers) contains the registration requirement (s 6), the process for registration and renewal (s 7), grounds for refusal (s 8), conditions (s 9), and lapsing (s 9A), followed by regulatory action (s 10), representations (s 11), recovery of financial penalties (s 12), and appeals (s 13).
Part 3 (Prevention of Money Laundering, Terrorism Financing and Proliferation Financing) sets out the substantive compliance obligations: customer due diligence, cash transaction reporting, record-keeping, internal programmes, targeted sanctions measures, suspicious transaction disclosure, and regulatory directions.
Part 4 (Monitoring and Enforcement) provides investigation powers and seizure-related provisions, including court oversight.
Part 5 (General Offences) covers false information and obstruction.
Part 6 (General) includes information sharing with foreign authorities (s 29), protection from personal liability (s 30), composition of offences (s 31), corporate and association liability (ss 32–33), jurisdiction (s 34), codes of practice and guidelines (s 35), publication powers (s 36), and service of documents (ss 36A–36B). It also contains exemption and regulation-making provisions (ss 38–39) and saving/transitional provisions (s 40). The Schedule lists the precious metals and precious stones covered.
Who Does This Legislation Apply To?
The Act applies to persons who carry on a business of regulated dealing and, depending on the statutory definitions, to persons acting as intermediaries for regulated dealing. The Schedule and interpretive provisions identify which precious metals and precious stones are within scope, and the Act’s definitions also capture certain related instruments and products (for example, the extract shows an “asset-backed token” definition with exclusions for securities/derivatives, commodity contracts, and digital payment tokens).
In practice, the regulated community will include dealers in precious metals and stones, and intermediaries such as brokers, auctioneers, exchanges, or providers of trading/clearing facilities for regulated dealing. The compliance obligations in Part 3 apply to regulated dealers in respect of their customer and transaction activities within the scope of the Act.
Why Is This Legislation Important?
This Act is important because it creates a sector-specific compliance regime that regulators can enforce with registration controls and robust investigative powers. For practitioners advising clients in the precious stones and precious metals industry, the Act is not merely a “policy” instrument; it is a legal framework that can affect the ability to operate lawfully (registration), the ability to continue operating (lapse/conditions), and exposure to criminal liability (false information and obstruction).
From an enforcement perspective, the combination of customer due diligence, cash transaction reporting, record-keeping, and suspicious transaction disclosure provides a structured evidentiary trail. Investigators can test whether a dealer’s internal processes were adequate and whether the dealer acted appropriately when risks materialised. The seizure provisions in Part 4 further increase the stakes: non-compliance can lead to immediate interference with property in certain circumstances.
Finally, the Act’s alignment with international standards (FATF Recommendations) and its targeted sanctions measures mean that compliance is expected to be dynamic and risk-based. Practitioners should therefore treat the Act as part of a broader ecosystem of AML/CFT/CPF obligations in Singapore, including how it interacts with other financial and corporate legislation.
Related Legislation
- Accountants Act 2004
- Commodity Trading Act 1992
- Companies Act 1967
- Financial Act
- Futures Act 2001
Source Documents
This article provides an overview of the Precious Stones and Precious Metals (Prevention of Money Laundering, Terrorism Financing and Proliferation Financing) Act 2019 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.