The Monetary Authority of Singapore’s (MAS) “the Information Paper” on representative recruitment and onboarding serves as a significant signal to the industry. Based on a thematic review between 2024 and 2025, the Information Paper identifies a material gap between regulatory expectations under the Fit and Proper framework and actual implementation within Regulated Financial Institutions (“RFIs”).
The review highlights systemic weaknesses in governance, particularly in pre-appointment due diligence and risk-based supervision. While formal policies exist, MAS observed gaps in execution, documentation, and escalation, especially in assessing personal financial soundness, conflicts of interest, and adverse information. Monitoring arrangements were not consistently calibrated to individual risk profiles, exposing RFIs to potential conduct and governance vulnerabilities.
The information paper provides RFIs with a structured framework for strengthening representative governance, offering a practical roadmap for Internal Audit focus areas. By aligning internal policies with the best practice standards outlined, RFIs can shift from reactive compliance toward a proactive culture of accountability that protects both integrity and client interests.
Nature and Significance of the MAS Review
Although the Information Paper is not legislation or a legally binding Notice, it carries significant supervisory weight. It articulates MAS’ expectations and clarifies the standards against which recruitment; onboarding and monitoring frameworks should be assessed. For Compliance functions, it provides a practical basis for evaluating control effectiveness.
RFIs are provided with a structured basis for self-assessment and gap analysis, and are expected to review their policies, processes and governance arrangements against these observations and implement timely remediation where weaknesses are identified, particularly where deficiencies may point to broader cultural or oversight concerns.
As always, ultimate accountability rests with the Board and Senior Management, who are responsible for establishing effective governance, monitoring and training frameworks. The Information Paper should therefore be treated not merely as a reflection of best practices, but as an articulation of supervisory expectations against which RFI readiness may be measured. Action should be taken not out of anticipation of formal inspections or audits, but because strengthening governance and oversight is fundamentally the right thing to do.
Fit and Proper as the Foundational Standard
The Fit and Proper requirement remains the cornerstone of representative oversight, forming the baseline standard for evaluating suitability for regulated activities under the MAS framework. Recent observations reinforce that this assessment extends beyond a procedural checklist; it requires a holistic evaluation of honesty, integrity, competence, capability, and financial soundness, supported by clear governance and proper documentation.
The appointment of a representative is therefore not merely an administrative formality, but a key risk control reflecting the RFI’s accountability and risk culture. For a deeper analysis of the fit and proper framework, please refer to our article Back to Basics: Understanding the Fit and Proper Standards, available on our website.
Key Observations from MAS’ Review
Based on the findings highlighted in the paper, four areas appear to be attracting more regulatory attention:
Onboarding as a Control Point
A key concern is representatives starting regulated activities before being completely onboarded with the RFI. While there exist commercial pressures to deploy staff quickly, the employee onboarding exercise is a formal control. Allowing individuals to advise clients before due diligence, supervisory structures, and Fit and Proper assessments are finalised exposes RFIs to conduct and regulatory risks. Regulated activities should only begin once the assessment is formally completed and documented, allowing for easy submission of the relevant notification/approval forms.
Managing Representatives with Adverse Information
The presence of adverse information, such as prior misconduct, complaints, or financial distress, does not automatically disqualify an applicant. However, weaknesses often arise when RFIs lack structured, well-documented, and risk-based decision-making frameworks. Where prior adverse news exists – risks are higher, and therefore enhanced supervision and tailored safeguards are expected, as regular oversight may not adequately address underlying conduct concerns.
Training Before Client Engagement
Representatives should complete role-specific onboarding training, covering product knowledge and internal compliance policies, before engaging with clients or prospects. Such training should be pre-approved to ensure that this is fit for purpose. This would also apply to representatives that are promoted to a supervisory capacity – where the role, responsibility and expectation of the position should be clearly communicated in a formal manner.
Assistants and Outsourced Activities
The hiring of personal assistants by representatives can create blind spots, as assistants may access sensitive client information or perform activities requiring clear oversight. Likewise, while functions like background checks or training may be outsourced, regulatory accountability remains with the firm. Weak governance or insufficient oversight of such outsourced arrangements can lead to unintended control gaps.
Governance Expectations and Accountability
From a governance standpoint, weak onboarding controls are not merely operational lapses but a reflection of the RFI’s commitment to a culture of integrity. While execution of due diligence and training may be delegated, accountability remains with the Board of Directors and Senior Management. Management is expected to approve structured recruitment policies and robust oversight frameworks, particularly for individuals with adverse backgrounds.
Management must ensure they are receiving adequate reporting on these processes to verify that the “gatekeeper” function is working as intended. If a governance structure treats onboarding as a back-office formality rather than an effective risk control, the RFI is misaligned with current supervisory expectations.
Practical Reflections for Regulated Financial Institutions
To address practical concerns highlighted in recent regulatory findings, RFIs must move beyond written policy and assess the operational effectiveness of their controls. The following assessments reflect current supervisory expectations for a robust recruitment and onboarding framework:
Are the due diligence standards applied consistently across all candidates, including high-performing “stars” or senior hires, or are standards relaxed for certain individuals or groups?
Standards must be applied consistently to all candidates, including senior or high-performing hires. Any relaxation of due diligence requirements constitutes poor practice. Thorough verification and proper documentation, including Fit and Proper declarations addressing honesty and integrity, must be completed for every appointment.
Are the reasons behind an applicant’s overdue debts or undeclared indebtedness actively investigated, rather than being disregarded simply because they fall below a specific monetary threshold?
RFIs must actively investigate the reasons behind an individual’s overdue debts or undeclared liabilities. Credit checks may not necessarily disclose such information, so it’s important to understand the financial status of an individual to a sufficient level prior to them being appointed as a representative. Skipping financial soundness assessments for debts below a certain threshold is considered poor practice. MAS expects RFIs to consider significant indebtedness relative to a representative’s income and cash flow, as these factors are likely to affect their fitness and propriety.
Is the enhanced monitoring measures reviewed to see if they’re still necessary, or do they lapse over time without being reassessed?
Enhanced monitoring should not lapse automatically over time; RFIs must formally assess a representative’s conduct before lifting measures. Clear criteria and expected standards, such as specific performance targets or clean conduct records, should be established and communicated to ensure risks are fully addressed.
How Curia Regis Can Support
Curia Regis provides solution-driven support to help your firm align with MAS’s evolving supervisory expectations for representative management. We bridge the gaps identified in this Information Paper through:
1. Fit and Proper Framework Reviews:
Conducting comprehensive gap assessments of existing fit and proper frameworks against MAS supervisory expectations, covering governance oversight and approval processes, documentation standards, financial soundness and adverse information screening controls, as well as escalation and decision-making protocols, with structured remediation plans to address identified weaknesses.
2. Due Diligence & Onboarding Controls:
Enhancing representative onboarding frameworks through structured due diligence checks (including credit, litigation, disciplinary and reference checks), strengthening documentation standards aligned with regulatory guidance, ensuring substantive Board or Senior Management signoffs, and establishing controls over Form 3A submissions and certification workflows.
3. Competency & Training Governance:
Reviewing competency tracking systems, examination requirements and Continuing Professional Development (CPD) monitoring processes to ensure alignment with FAA-N26 requirements, internal policies and supervisory expectations, including oversight of third-party training materials where applicable.
4. Monitoring & Surveillance Frameworks:
Designing and strengthening ongoing monitoring programmes for representatives, including background screening, enhanced supervision frameworks, trigger-based reviews (such as complaints, indebtedness, or misconduct indicators), periodic reassessment of fit and proper status, and documentation standards capable of withstanding supervisory scrutiny.
If your institution is reviewing its representative governance framework or preparing for supervisory engagement, Curia Regis can provide structured, independent support tailored to your operational realities.
We Provide, You Decide
You can reach us here or email admin@thecuriaregis.com to get in touch.
