PUTRAJAYA, Sept 3 — Bank Negara Malaysia (BNM) has a limited role in investigations on money-laundering, its deputy governor Datuk Nor Shamsiah Mohd Yunus said today amid questions over the central bank’s silence over a RM2.6 billion donation deposited into Prime Minister Datuk Seri Najib Razak’s private bank accounts.
Nor Shamsiah said it is not the sole authority responsible for anti-money laundering probes, noting that it can only operate within the laws under its jurisdiction.
“The anti-money laundering law in Malaysia is not a law that is administered by the central bank alone. It is administered by 14 agencies,” she said at the 16th International Anti-Corruption Conference here, referring to a national committee chaired by BNM.
Under the anti-money laundering law here, BNM is designated as the competent authority to collect reports on suspicious transactions, which it would then forward to other law enforcement agencies.
“Our responsibility under that law is to disseminate the information to the appropriate law enforcement agencies,” Nor Shamsiah added.
She was responding to panel session moderator Michael Peel, who had asked for Bank Negara’s stand on the RM2.6 billion donation.
Nor Shamsiah was speaking at a session titled “Keeping Business Clean and Stopping Illicit Financial Flows”.
In the same response to Peel, Nor Shamsiah did not state if BNM had received any information tagging the RM2.6 billion amount as a suspicious transaction or if the central bank had passed on such information to other enforcement agencies.
She had explained however that BNM typically carries out investigations under two main laws — Financial Services Act and the Islamic Financial Services Act.
The relevant offence tied to a suspected money laundering activity would be probed by the relevant agency, she said while citing as an example the Malaysian Anti-Corruption Commission (MACC) which would probe suspected corruption.
She had earlier said the illegal flow of money in Malaysia revolved around five high-risk areas — corruption, drugs, smuggling, tax evasion and fraud.
The current challenge in Malaysia is in securing higher numbers of successful prosecution and convictions for money laundering cases, Nor Shamsiah said.
This is because law enforcement agencies probing offences leading to such illegal flow of funds open far fewer investigation papers on the related money laundering offence, she added.
When probed further on whether BNM was worried that the publicity and lack of clarity on the RM2.6 billion case would damage its reputation, Nor Shamsiah pointed out that the central bank conducts regular checks on other banks that would help to reduce the risk of money-laundering and reputation damage.
“We do continuous assessment as to how robust the bank controls are in mitigating risk activities and these risks range from credit risks to money-laundering risks.
“In fact, since three years ago, we have fined banks more than RM10 million for the lapses that we have found in management of money laundering risks that can also affect reputational risks,” she said.
The RM2.6 billion donation from an unnamed Middle Eastern source to Prime Minister Datuk Seri Najib Razak’s accounts is still under a probe by the MACC.
