The dual compliance reality for Singapore FSI (Financial Services Industry) employers
HR practitioners and employers within the Singapore financial services industry often face a double challenge when hiring senior talent. Not only do they have to meet the Ministry of Manpower’s (MOM) background check and verification standards for Employment Pass (EP) eligibility, but they may also need to ensure that their candidate passes MAS’ fit-and-proper test, if the candidate is a “relevant person” covered under Guideline FSG-G01 on Fit and Proper Criteria.
In this article, we cover what both compliance systems require, where they overlap, and how HR practitioners can navigate this dual compliance landscape as efficiently and accurately as possible.
What MAS fit-and-proper standards require
What MAS requires of relevant persons
Under FSG-G01, MAS considers anyone who carries out MAS-regulated activity under any written law, as a “relevant person” who is subject to a fit-and-proper test. This generally means all company executive officers including CEOs, CFOs, CROs, heads of treasury (and their deputies), as well as material risk personnel, substantial shareholders, and the shareholders’ appointed representatives – although the scope varies according to the sector.
For these key leaders, MAS requires that they demonstrate their fitness and propriety to take office in three areas:
- Their honesty, integrity and reputation
- Their competence and capability
- Their financial soundness
The five-year reference check requirement
As part of this “fit and proper” test, one of the key requirements that MAS set in place on 12 December 2023 was a mandatory reference check regime; not just at the point of hiring, but continuously over the course of an employee’s tenure. The lookback period of such a background screening would be a minimum of five calendar years and would cover senior management and material risk personnel.
Such background screening for FSI personnel would minimally cover areas such as identity, credentials, employment history, disciplinary records, information relevant to MAS’ “fit and proper” test, performance and risk assessments, and any regulatory or ongoing matters such as prohibition orders, in order to prevent fraud or misrepresentation for individuals working in the industry.
What MOM verification requires for work pass applicants
Educational credential verification
Running parallel to this five-year reference check is the potential EP application background check that needs to be conducted if the relevant person being hired is not a Singapore resident.
Under MOM’s EP and work pass requirements, any employer applying for an EP for a foreign hire will need to score at least 40 points on the COMPASS test. One of the main scoring components in the process is the degree(s) or qualification(s) the EP candidate holds.
Document authentication via MOM-endorsed channels
To be considered and scored under COMPASS, a candidate’s educational credentials will need to be verified and authenticated by a MOM-endorsed background check provider like RMI, who will ensure that the candidate is legitimate, and that there has been no dishonesty or misrepresentation.
Where the two frameworks intersect in practice
From the information above, it is clear that while both background checks are focused on veracity and authenticity, they are intended for different purposes. The MAS requirements go significantly further than MOM’s. Nevertheless, at least for a new foreign hire, these two checks will be running concurrently, and do contain some overlapping elements, namely, a lookback period of years, as well as identity and educational qualification verification.
With all of this in mind, for HR practitioners in the financial services industry, there is pressure coming from both sides. When HR leaders have to grapple with both background check regimes, there is a potential risk of duplicating efforts and resources. Here’s how this can be avoided.
Running combined MOM and MAS checks without duplicating effort
The first thing finance industry HR practitioners can do is to sequence your applications to minimise wasted effort. As an EP is the absolute prerequisite to do any work in Singapore, it would make sense to commence your MOM EP application process first, before expending resources and time on the more onerous MAS reference test.
However, it may still make sense to at least start reference outreach first for MAS while working through the EP academic verification phase. Both these tasks tend to take a long time and are dependent on other stakeholders, which can introduce unforeseen delays that would hold back the overall process if started late.
How RMI supports FSI employment pass verification
As an MOM-endorsed background check provider, RMI is accredited to provide verification of an employment candidate’s academic qualifications as a key part of Employment Pass applications, with a fast turnaround time using methodologies and partnerships that don’t compromise on accuracy or rigour. The verifications obtained as part of this process will also be audit-ready and usable as part of a broader MAS reference check.
Since an EP is crucial to the entire hiring process, partnering with the right background check provider makes a big difference in how quickly and smoothly the process can progress. Speak to the team at RMI to ensure the success of your EP application. This is a prudent first step to help you make a good start on your candidate’s dual compliance requirement. Get started with RMI today.