Singapore’s image as a safe haven for wealthy mainland Chinese families is eroding. The wealthy Chinese are now finding their way back to rival wealth hubs like Hong Kong and Japan. The inflow of Chinese wealthy families started after 2019, when a wave of pro-democracy protests in Hong Kong led to a clampdown by Beijing and the introduction of a national security law the next year. The political stability, a favorable family-office regime, independent courts, and Mandarin fluency made Singapore a natural draw for China’s super-rich. However, in the wake of a $2.3 billion money-laundering scandal in 2023 dubbed the “Fujian case”, Singapore’s regulators and banks began an aggressive clean-up. They tightened the rules and re-screened wealthy clients. According to Ryan Lin, a director at Bayfront Law in Singapore, “ When the Fujian news broke, a lot of these wealthy Chinese left. So literally, almost all … they go to Hong Kong, the Middle East, Japan.” That departure has accelerated since then. Applications from mainland clients slashed 50% Ryan Lin, who evaluates and handles applications from rich Chinese people who want to set up family offices or live in Singapore, is getting 50% fewer applications from mainland clients now than in 2022. More push is from the new rules and compliance checks that are going into effect. Applicants for permanent residence and family offices must undergo extensive background checks. This includes disclosures about their family and dependents, as well as requirements they see as invasive. Carman Chan, founder of Click Ventures, a single-family office, similarly said that many of her family office peers who set up businesses in Singapore are relocating back to Hong Kong. Chan said that some KYC certifications took more than a year, which made some investors move their businesses to other places. In Dubai’s International Financial Centre, it takes about two to six months. According to the consulting firm Acclime, getting a residency or work visa for family office professionals in Hong Kong is usually easier than in Singapore. Henley & Partners, a company that helps rich people get residence in Singapore through investments, says that in 2025, Singapore will see a sharp drop in the number of affluent people moving there. They estimate only 1,600 millionaires will move there, which is less than half of the 3,500 that were expected to go there in 2024. Crypto companies leave Singapore due to the MAS The Monetary Authority of Singapore (MAS) pushes to make sure everyone follows the rules. This has become effective mainly for crypto, which has made people even less interested. This year, Singapore made it a rule that platforms that sell cryptocurrencies, stablecoins, or tokenized equities to customers outside of the city-state must be licensed. The central bank of Singapore said that approvals would be rare and that compliance costs would be high. For example, there is a minimum capital requirement of SG$250,000 and strong controls against money laundering, technical risk, and illicit behavior. Crypto firms offering services to customers within Singapore are already regulated under existing laws. So for this year, those who are in the crypto space particularly, they have all gone because of this particular legislation by the MAS It’s already very hard to apply for a license in Singapore, and then you come out with another legislation targeting even services to people outside Singapore. So all of them left. Ryan Lin. Banks and other financial institutions did a lot of “clean-ups,” like redoing know-your-customer (KYC) checks, re-screening family office applications, and in some cases even deleting accounts. That put a lot of rich Chinese clients in limbo, unable to get to their accounts or register new ones. Also, Iris Xu, the founder of Jenga, a corporate services firm that works with rich mainland Chinese people in Singapore, says that the aftermath of Singapore’s money-laundering scandal and high-profile crypto failures like Three Arrows Capital and FTX led to a strong push for compliance in 2024. Get up to $30,050 in trading rewards when you join Bybit today
