Singapore is expanding its approach to financial crime detection through COSMIC, a collaborative information-sharing platform designed to help banks identify suspicious activity across institutional boundaries.

As regulators look to broaden its reach, the initiative is placing greater emphasis on the quality of financial institutions’ underlying anti-money laundering (AML) systems and the role of RegTech in supporting cross-bank intelligence sharing. RegTech provider ZIGRAM argues that COSMIC’s effectiveness depends on the strength of participating institutions’ own screening, transaction monitoring and entity risk assessment capabilities. Its analysis highlights the importance of reliable customer data and accurate risk detection in ensuring that shared intelligence helps uncover financial crime rather than generating additional compliance noise.

COSMIC, short for Collaborative Sharing of ML/TF Information & Cases, is Singapore’s first centralised digital platform enabling prescribed financial institutions to exchange specified customer risk information. The Monetary Authority of Singapore (MAS) launched the platform on 1 April 2024 under Part 4A of the Financial Services and Markets (Amendment) Act 2023.

Six banks participated in the initial phase: DBS, OCBC, UOB, Citibank, HSBC and Standard Chartered. The platform focuses on three priority areas: the misuse of legal persons, the abuse of trade finance for illicit purposes and proliferation financing.

COSMIC was established to address a persistent weakness in traditional AML controls: financial institutions often have visibility only into the accounts, transactions and corporate relationships within their own systems. A company operating across several banks may appear relatively low-risk when each institution assesses its relationship independently. When information is connected across those institutions, however, patterns involving shell companies, suspicious trade flows or related counterparties may become clearer.

Source link