APRIL 1 — Economic crime has long weighed on Malaysia’s economy. Between 2018 and 2023, losses from corruption alone are estimated at RM277 billion (approximately US$60 to 65 billion), or about RM1,609 per Malaysian, more than a full month of minimum wage during that period for many Malaysians, which puts the real-world impact of these statistics into perspective. 

The shadow economy is also significant, estimated at up to 30.2 per cent of GDP, driven by smuggling, tax evasion and unreported business activity. On the digital front, online fraud reported losses reached RM5.62 billion from 2023 to 2025, spanning phone scams, e-commerce fraud and fake investment schemes.

Yet the past 18 to 24 months have marked a turning point. Stronger laws, tighter coordination and more decisive enforcement have begun to deliver results: faster fund tracing, more mule-account takedowns, fewer successful phishing attacks, and a higher volume of blocked fraud attempts.

What is emerging is not just incremental reform, but a broader reset. One that is reshaping how Malaysia detects, disrupts and deters economic crime.

A new legal toolkit

Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities (Amendment) Act 2025

The latest amendments to the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (AMLA) 2001 expand its reach to cover proliferation financing, while strengthening powers across investigation, reporting, supervision and forfeiture.

Compliance expectations have also been raised, particularly for designated non-financial businesses and professions such as law firms, accountants and estate agents.

In practice, these changes widen the enforcement net and enable earlier intervention, allowing authorities to identify and freeze suspicious assets more swiftly.

Companies (Amendment) Act 2024

Beneficial ownership is now firmly embedded within Malaysia’s corporate framework following amendments to the Companies Act 2016. The new section 60A, together with the Companies Commission of Malaysia’s Guidelines for the Reporting Framework for Beneficial Ownership of Companies (Revised 2025), defines a beneficial owner of a company as the natural person who ultimately or effectively owns or controls a company, whether formally or informally.

By cutting through shell structures and layered ownership, these reforms make it harder to conceal illicit proceeds and easier for investigators to trace funds in corruption and fraud cases.

Penal Code (Amendment) Act 2024

New offences targeting mule accounts and account-rental schemes address a critical weak point in scam operations. 

It is now an offence to:

• possess or control another person’s account or payment instrument without lawful authority;
• allow another person possession or control of one’s own account; and
• conduct unlawful transactions using one’s own or another person’s account.

These provisions go directly to the operational backbone of scam networks, enabling authorities to act not only against masterminds but also the facilitators who sustain these schemes.

Government Procurement Bill 2025

Malaysia is also moving to hardwire transparency into public procurement through its first dedicated procurement law. The Bill standardises tender rules, makes open and competitive bidding the default, and extends coverage to many government-linked entities.

A national vendor registration framework requires suppliers to meet fit-and-proper criteria, declare conflicts of interest, and comply with codes of conduct, with non-compliant vendors subject to suspension or exclusion.

E-Invoicing

Mandatory e-Invoicing adds another layer of control. By requiring invoices and related documents to be validated electronically before issuance, the system reduces fraud risks and improves tax visibility.

The result is a more transparent and traceable transaction environment, limiting opportunities for manipulation at the source.

Looking ahead

Taken together, these reforms signal a shift towards earlier intervention, tighter oversight and more effective disruption of illicit activity.

But laws alone do not enforce themselves. Their effectiveness will depend on how well they are supported by institutional coordination, intelligence capabilities and cross-border cooperation, particularly in cases where funds move rapidly across jurisdictions.

Malaysia’s economic crime reset is therefore not just about stricter rules, but about building a system that can act quickly, operate across borders and deliver real enforcement outcomes where they matter most. Ultimately, stronger laws matter, but faster action matters more.

* Leonard Yeoh is a senior partner and Sharon Teo an associate with the law firm, Tay & Partners.

** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.