I am disturbed. I really am. What is the source of my discomfort, you ask? Well, a Director of our Monetary Authority of Singapore (MAS) has written to the press, in reply to a reader's question, that "Insurance companies are expected to have clear policies...", that "MAS expects the board and senior management to ensure that these policies and procedures are implemented consistently". She was writing in response to a reader's letter questioning the security of having one's personal data stored on insurance agents’ laptops. Some other readers have gone on to question the wider practice of providing photocopied ICs for all kinds of applications, depositing ICs with the security guard, etc.
While MAS may not have oversight over the latter, its reply concerning the former certainly gives no comfort to the person considering an insurance policy. If governance can be executed through expecting that people and organisations will do the right thing, then the frauds that have been surfacing over the last few years, from Enron to Satyam, would not have occurred. But it is precisely because these things do happen, and that even after auditing firms have done their jobs (or not) in conducting periodic statutory reviews. What is alarming in many cases is that fraud can take place with the most respectable people (e.g. Bernard Madoff - described as a long-standing leader in the financial services industry), that something more cries out to be done. I am not suggesting that we stifle the industry with more government rules thereby imposing onerous bureaucratic procedures on businesses that are struggling in these times. But its current 'hands-off' approach is surely too optimistic of human nature.
Might Singapore be waiting for its next Enron, or Satyam or, worse, its Bernard Madoff to make MAS' Communications Director's words come back to haunt her? We have had Leeson-Barings under our belt, but we certainly don't need another.