SINGAPORE: While the Singapore government is considering various proposals to help scam victims recover their lost funds, Minister of State for Home Affairs Sun Xueling highlighted that it is operationally challenging to apportion and track the amount of scam proceeds returned to victims or forfeited to the state.
She explained that seized proceeds are often co-mingled with those from other criminal activities, such as unlicensed money lending. Additionally, seized funds may not directly correspond to crimes committed in the same year.
“It would also be resource intensive, given the high volume of scam cases,” Sun added.
Sun was responding to a parliamentary question filed by Workers’ Party MP Gerald Giam on Friday (28 February).
Giam leaned forward, his curiosity piqued as he inquired about the often murky waters of financial crime. He wanted to know the percentage of cases where confiscated assets are actually returned to victims. Additionally, he sought clarity on how much of the seized proceeds from scams ultimately end up forfeited to the state.
Sun took a moment to gather his thoughts before responding. He explained that the Police play a crucial role in the fight against financial crime. They have the authority to freeze bank accounts and seize assets that are suspected to be linked to illicit activities.
As investigations unfold, officers meticulously comb through bank transaction records. This process helps them establish ownership and track down the origins of suspicious funds.
Sometimes, the seized assets are held for extended periods, especially if they are needed for ongoing investigations or upcoming court proceedings. Sun emphasized that while victims often face delays, measures are in place to prioritize their restitution before any funds are transferred to the Government’s Consolidated Fund.
It’s a complex system, but one aimed at ensuring justice is served.
When the police determine that certain assets are no longer needed for an investigation, they take a formal step. They apply to the Court to facilitate the return of these assets to their rightful owners. This process ensures that individuals who have been wrongfully deprived of their belongings can reclaim what is rightfully theirs.
However, complications arise when ownership cannot be clearly established. In such cases, the authorities publish a notice in the Government Gazette. This notice serves as a public announcement, inviting anyone who believes they have a claim to come forward. If no claims are made within six months, the assets are forfeited to the State, becoming part of the public treasury.
In light of recent events, Gerald Giam has proposed an innovative solution aimed at aiding scam victims. He suggested creating a restitution fund specifically for those affected by scams, funded by proceeds confiscated from money laundering operations.
During a recent inquiry, Giam sought clarification on whether a notice had been published in the Government Gazette regarding claims related to the recent S$3 billion money laundering case. He pressed for details on when this notice might be released if it had not yet been issued.
In a recent parliamentary session, Sun responded to inquiries regarding the S$3 billion money laundering case, emphasizing that the details were highly specific to the case itself. She suggested that Giam, the questioning member, consider filing a separate parliamentary question to obtain more comprehensive information.
Turning her attention to the proposal for a restitution fund aimed at scam victims, Sun acknowledged that various options were being explored. However, she highlighted several operational challenges that complicated the implementation of such a fund.
One significant hurdle is the difficulty in identifying legitimate claimants. Often, recovered funds are intertwined with proceeds from other criminal activities, which muddles the process of determining who deserves compensation.
In particular, cases involving cryptocurrency present unique complications. The use of tumblers and mixers in cryptocurrency transactions obscures the trail of funds, making it “very, very difficult” to link any recovered assets back to specific victims.
As a result, Sun cautioned that these challenges could significantly delay or hinder the establishment of an effective restitution mechanism for those affected by scams. The complexities of tracing and verifying claims call for careful consideration and innovative solutions.
In a recent discussion, she expressed her concerns about the complexities involved in distributing recovered funds from scams. “As a result, it is going to be very difficult to determine, within a consolidated fund, which victim actually has a rightful claim to the recovered monies,” she noted, emphasizing the challenges that lie ahead.
Sun revealed alarming statistics regarding scam and cybercrime victims in Singapore. In 2024 alone, these individuals lost an astonishing S$1.1 billion. Yet, only S$182 million had been successfully recovered, highlighting a significant gap between losses and available restitution.
“This disparity means there will be far more claimants for the funds than actual proceeds recovered,” she pointed out, illustrating the uphill battle faced by many victims seeking compensation.
She also raised a troubling possibility: scammers might take advantage of compensation schemes. By recruiting money mules, they could create fraudulent claims for restitution, further complicating the process.
Despite these obstacles, she emphasized the importance of pursuing recovery efforts. “We must strive to compensate victims,” she said in agreement, recognizing the need for a fair resolution in the face of overwhelming challenges.
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