The Monetary Authority of Singapore has censured United Overseas Bank for allowing three of its employees to provide financial advice before they were properly regulated.

The Monetary Authority of Singapore has censured United Overseas Bank for allowing three of its employees to provide financial advice before they were properly regulated.

The news comes as Singapore's financial watchdog is in the process of conducting a review of the city-state's financial advisory industry, to enhance its regulatory framework.

Last week it reprimanded UOB, which is Singapore's third largest banking group, for contravening the Securities and Futures Act and the Financial Advisors Act.

Those regulations state that a principal shall not permit any individual to carry on business in any type of regulated activity on its behalf unless the individual is an appointed representative, provisional representative or temporary representative in respect of that type of regulated activity. A principal shall not permit any individual to provide any type of financial advisory service on its behalf unless the individual is an appointed representative or provisional representative in respect of that type of financial advisory service.

UOB allowed three individuals to conduct the regulated activity of advising on securities and provide financial advisory service on its behalf. This happened between 26 November 2010 to 9 March 2011. During that period time they had not been appointed representatives to the MAS for the relevant type of regulated activity and financial advisory service.

UOB has confirmed with the MAS that they have put in place policies and procedures to prevent future recurrence, said the MAS in a statement.

TheMAS expects all exempt capital markets services licensees and exempt financial advisers to ensure that they do not permit any individual to provide any type of regulated activity on its behalf unless the individual is an appointed or provisional representative in respect of that type of regulated activity.

FAIR

MAS is in the process of conducting a review of the financial advisory industry that could fundamentally change the way wealth management is conducted in the city-state.

Singapore's watchdog wants to enhance the professionalism and competence of financial advisors, and create a more competitive and efficient system for distribution of life insurance and investment products, said MAS managing director Ravi Menon in March.

The review will look at a wide range of areas from the entry requirements of financial advisers to their compensation and distribution structure of products.

The MAS will set up a review panel to look at five areas where it will propose changes. The whole process which will be known as Financial Advisory Industry Review, or FAIR. The members of the review panel will be announced shortly.

"We are far better at earning an income than investing it and protecting against risk," said Menon at the time.