Recent changes to the AML/CFT law in Malaysia

Publication Date03 Jan 2017
AuthorZaiton Hamin
SubjectAccounting & Finance,Financial risk/company failure,Financial compliance/regulation,Financial crime
Recent changes to the AML/CFT
law in Malaysia
Zaiton Hamin
Department of Law, Universiti Teknologi MARA, Shah Alam, Malaysia
Purpose The aim of this paper is to examine some of the recent changes to the old anti-money laundering
and anti-terrorism nancing law, which is now known as the Anti-Money Laundering, Anti-Terrorism
Financing and Proceeds of Unlawful Activities Act 2001. The paper will highlight the newly consolidated
money laundering offences and the newly created offences including structuring of transactions or
“smurng”. Also, the transgression of cross-border movement of cash and negotiable instruments and tipping
off about a money laundering disclosure will be assessed.
Design/methodology/approach The paper uses a doctrinal legal research and secondary data, with
the new AML/CFT legislation as the primary source. For comparative analysis, legislations in the UK,
Australia and New Zealand are also examined. Secondary sources include case law, articles in academic
journals, books and online databases.
Findings The review of the AML/CFT law is timely and indicates the Malaysian government’s efforts to
adhere to international standards set by the nancial action task force. However, it is imperative that the
Malaysian government addresses the remaining instrumental and normative deciencies in the AML/CFT
law to ensure that the recent legal changes are sufciently comprehensive to prevent and regulate money
laundering and terrorist nancing within Malaysia.
Originality/value This paper is a useful source of information for legal practitioners, academicians, law
enforcement, policymakers, legislators, researchers and students.
Keywords Money laundering, Terrorism nancing, Structuring transactions,
Cross-border cash movement, Penalty, Tipping off
Paper type Research paper
As a signicant worldwide phenomenon, money laundering offence is perpetually
serious, as it provides incentives for many crimes by rendering them worthwhile. Also,
such crime is providing the domestic and transnational organized criminals with the
cash ow to perpetrate further crimes. What is worrying is that it may also threaten the
nancial system and its institutions, both domestic and international (CPS, 2002).
Widespread international concern over such crime has led to its criminalization and the
establishment of various regulatory modalities in many countries around the world,
including Malaysia. In 2001, in her attempts to curb money laundering activities,
Malaysia enacted AMLA, which came into force on January 15, 2002 (Shanmugam and
Thanasegaran, 2008). The Central Bank of Malaysia or Bank Negara Malaysia (BNM) is
currently the nancial intelligence unit or the “competent authority” for the purpose of
combating money laundering activities under the 2001 Act. In 2003, AMLA was revised
and renamed as AMLATFA (2001) to provide for the offence of money laundering, the
measures to prevent money laundering of proceeds from the varied predicate offences
and terrorist nancing offences. Besides, AMLATFA is to provide for the forfeiture of
terrorist property and property involved in, or derived from, money laundering and
terrorist nancing offences (Mohd Yasin, 2002;Shanmugam and Thanasegaran, 2008).
The current issue and full text archive of this journal is available on Emerald Insight at:
Journalof Money Laundering
Vol.20 No. 1, 2017
©Emerald Publishing Limited
DOI 10.1108/JMLC-04-2015-0013

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