SINGAPORE: Court cases involving “silent” or nominee directors—who assisted in incorporating companies but lacked oversight—have appeared frequently.
After the aforementioned company, a foreign entity incorporated in Singapore, transacts criminal proceeds, many are frequently prosecuted. Most recently, in June, two men were brought before the court after companies they assisted in incorporating received over $1 million in proceeds from a scam.
Additionally, at the beginning of July, Singapore passed a law that aims to stop the abuse of nominee directorship arrangements to establish front companies for money laundering.
Nominee directors may be Singaporeans or permanent residents over eighteen. They cannot be previously disqualified from the position or undischarged bankruptcies. Companies from other countries unfamiliar with Singapore can hire a corporate service provider to find a representative at a cost.
According to the Singapore Legal Advice platform, a nominee director is usually not involved in other forms of business operations, unlike an executive director who oversees day-to-day operations.
That being said, being a nominee director entails more than just signing a document. Associate Professor Kelvin Law of Nanyang Technological University (NTU) explained that in the event of an inquiry, a nominee director acts as a “real” point of contact for local authorities.
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