Investigation and prosecution of money laundering cases in Malaysia

Published date05 October 2012
Date05 October 2012
DOIhttps://doi.org/10.1108/13685201211266006
Pages421-429
AuthorZakiah Muhammaddun Mohamed,Khalijah Ahmad
Subject MatterAccounting & finance
Investigation and prosecution
of money laundering cases
in Malaysia
Zakiah Muhammaddun Mohamed and Khalijah Ahmad
School of Accounting, Faculty of Economics and Management,
Universiti Kebangsaan, Bangi, Malaysia
Abstract
Purpose The purpose of this paper is to examine money laundering cases investigated by
the Central Bank of Malaysia under the Anti-Money Laundering and Anti-Terrorism Financing
Act 2001.
Design/methodology/approach – This study analyzes the contents of public releases by the
enforcement division of the Central Bank for period 2007 to 2011. Analysis of data is carried out based
on three categories: the predicate offence, the perpetrators and current status of the cases.
Findings – Findings reveal that most cases investigated by the Central Bank relate to sec 4(1) of
AMLATFA 2001 and the main predicate offence related to the money laundering charges are on illegal
deposit taking. Further it is found that directors of companies are the leading group of people charged
under the Act for money laundering. In addition, findings also show that only half of the cases
investigated have been charged in court.
Research limitations/implications Data from this research only come from enforcement
releases from the Central Bank of Malaysia. Since AMLATFA2001 is administered by multiple
agencies, the research may not provide a comprehensive view of all the cases investigated.
Future research should look at other agencies and in particular the Royal Police of Malaysia.
Practical implications – Findings from the study suggest that prosecuting money laundering
cases by Bank Negara Malaysia are limited to cases with predicate offence of illegal deposit taking.
The agency should explore other predicate offences and the concept of “irresistible inference” to
increase its effort in prosecuting money laundering activities in the country.
Originality/value – The paper documents and analyzes the actual cases being investigated for
money laundering offences. It provides basis for the standard setters to evaluate their effort to curb
money laundering activities in Malaysia.
Keywords Money laundering,Investigation, Prosecution, BankNegara Malaysia,
Anti-Money LaunderingAct 2001, Malaysia
Paper type Research paper
Introduction
Money laundering is a financial crime that generates increasing global concerns in this
modern age. The crime, commonly known as a crime of concealment, usually involves large
sums of illegal money being mobilized in many economies through the financial system. Up
to 2010, there are about 94 money laundering cases prosecuted at various stages involving
proceeds amounting to RM1.2 billion (Malaysian Insider, 2010). The increasing number of
money laundering activities in Malaysia was partly contributed by loopholes in the existing
law and lack of knowledge of the relevant legal institutions in combating money laundering
(The Star, 2009)[1]. Developed countries such as the USA and Australia have raised
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1368-5201.htm
This study has been made possible with funding from UKM grant UKM-DIMP-003-2011.
Money
laundering cases
in Malaysia
421
Journal of Money Laundering Control
Vol. 15 No. 4, 2012
pp. 421-429
qEmerald Group Publishing Limited
1368-5201
DOI 10.1108/13685201211266006

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