Clause 4

The Authority may, from time to time, inspect under conditions of secrecy the books of —

a financial institution; or

any subsidiary, branch, agency or office outside Singapore of a financial institution incorporated or established in Singapore,for the purpose of determining the extent of compliance by the financial institution with the directions issued and the regulations made under sections 27A and 27B.(2) The Authority may appoint any person, including an auditor (not being an auditor of the financial institution), to carry out an inspection under this section.(3) If the inspection is carried out on the ground that the Authority has reason to believe that the financial institution has contravened or is contravening any direction issued or regulation made under section 27A or 27B, and if the Authority so directs, then the financial institution is liable to pay for the remuneration and expenses of any person appointed under subsection (2) for the inspection.(4) The Authority may recover from the financial institution the remuneration and expenses referred to in subsection (3) as a civil debt due to the Authority.(5) The Authority may, in its discretion, waive the payment of all or any part of the remuneration and expenses referred to in subsection (3).(6) Where, in the course of an inspection under subsection (1), the Authority obtains any protected information as defined in section 30X(1), and that information is not necessary for taking any action regarding non‑compliance with any direction issued or regulation made under section 27A or 27B, then the Authority must treat that information as secret.(7) Subsection (6) does not prevent the transmission under section 27F, 30ZA, 30ZC or 30ZF by the Authority of any information to any authority referred to in the applicable section.(8) In this section and section 27D, “book” has the same meaning as in section 30X(1).(9) In this section and sections 27D, 27E and 27F, “financial institution” has the same meaning as in section 27A(6) read with section 27A(7).Obligation of financial institution under inspection27D.—

For the purposes of an inspection under section 27C(1), the financial institution must —

give the Authority access to such of the books of the financial institution as the Authority may reasonably require to conduct the inspection;

procure a person who is in possession of such of the books of the financial institution as the Authority may reasonably require to conduct the inspection, to give the Authority access to the books;

provide such information (including information relating to the internal control systems of the financial institution) and facilities as the Authority may reasonably require to conduct the inspection; and

procure a person who is in possession of such information (including information relating to the internal control systems of the financial institution) and facilities as the Authority may reasonably require to conduct the inspection, to provide the information and facilities to the Authority.(2) Subsection (1) has effect despite any obligation of confidentiality or other restrictions on the disclosure of information imposed on the financial institution or any of its officers, or on any person referred to in subsection (1)(b) or (d), by any prescribed written law as defined in section 30X(1) or any requirement imposed under any such written law, any rule of law, any contract or any rule of professional conduct.(3) A financial institution which refuses or neglects, without reasonable excuse, to comply with subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.(4) No civil or criminal liability is incurred by a financial institution or any of its officers, or by any person referred to in subsection (1)(b) or (d), in respect of any obligation or restriction referred to in subsection (2), for doing or omitting to do any act, if the act is done or omitted to be done with reasonable care and in good faith and for the purpose of complying with subsection (1).(5) A financial institution or any of its officers, or any person referred to in subsection (1)(b) or (d), that, with reasonable care and in good faith, does or omits to do any act for the purpose of complying with subsection (1) is not to be treated as being in breach of any obligation or restriction referred to in subsection (2).Confidentiality of inspection reports27E.—

Except as provided in subsection (2), where a written report has been produced in respect of a financial institution by the Authority following an inspection under section 27C, the report must not be disclosed to any person by —

the financial institution; or

any officer or auditor of the financial institution.(2) Disclosure of the report may be made —

by the financial institution to any officer or auditor of that financial institution solely in connection with the performance of the duties of the officer or auditor, as the case may be, in that financial institution;

by any officer or auditor of the financial institution to any other officer or auditor of that financial institution, solely in connection with the performance of their respective duties in that financial institution; or

to such other person as the Authority may approve in writing.(3) In granting approval for any disclosure under subsection (2)(c), the Authority may impose such conditions or restrictions as it thinks fit on the financial institution, any officer or auditor of that financial institution or the person to whom disclosure is approved, and that financial institution, officer, auditor or person (as the case may be) must comply with those conditions or restrictions.(4) The obligations of an officer or auditor under subsections (1) and (3) continue after the termination or cessation of the employment or appointment of the officer or auditor by the financial institution.(5) Any person who contravenes subsection (1), or fails to comply with any condition or restriction imposed by the Authority under subsection (3), shall be guilty of an offence and shall be liable on conviction —

in any case where the person is an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both; or

in any other case, to a fine not exceeding $250,000.(6) Any person to whom the report is disclosed and who knows or has reasonable grounds for believing, at the time of the disclosure, that the report was disclosed to the person in contravention of subsection (1) shall be guilty of an offence and shall be liable on conviction —

in any case where the person is an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both; or

in any other case, to a fine not exceeding $250,000.(7) Where a person is charged with an offence under subsection (6), it is a defence for the person to prove that —

the disclosure was made contrary to the person’s desire;

where the disclosure was made in any written or printed form, the person had as soon as practicable after receiving the report surrendered, or taken all reasonable steps to surrender, the report and all copies of the report to the Authority; and

where the disclosure was made in an electronic form, the person had, as soon as practicable after receiving the report, taken all reasonable steps to ensure the deletion of all electronic copies of the report and the surrender of the report and all copies of the report in other forms to the Authority.Authority may transmit information from inspection to corresponding authority27F.—

The Authority or any person authorised by the Authority may, on the Authority’s own motion, and subject to the satisfaction of such conditions as the Authority may determine, transmit any information obtained by the Authority from an inspection under section 27C to a corresponding authority as defined in section 30X(1) of a foreign country that exercises consolidated supervision authority (whether or not for compliance with any AML/CFT requirement as defined in section 30X(1)) over the financial institution to which the inspection relates.(2) Subsection (1) applies despite the provisions of any prescribed written law as defined in section 30X(1) or any requirement imposed under any such written law, any rule of law, any contract or any rule of professional conduct, and is without prejudice to section 30ZF or any other written law or rule of law authorising the Authority, or a person authorised by the Authority, to disclose information in the Authority’s or the person’s possession to another person.”.