Anti-money laundering obligations and dismissal of bankers: evidence from Malaysia

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Aspalella A. Rahman ◽  
Harlida Abdul Wahab
Keyword(s):  
Money Laundering ◽  
Secondary Data ◽  
Primary Sources ◽  
Court Cases ◽  
Sources Of Information ◽  
Content Type ◽  
Legal Risks ◽  
Significant Burden ◽  
The Law ◽  
The Right

Purpose This paper aims to analyse the anti-money laundering (AML) obligations imposed on bankers as the main reporting entities under the AML regime in Malaysia. Apart from discussing the relevant provisions, several court cases were also examined to identify the problems which arise in the implementation of the law and the risk of dismissal that bankers may face. Design/methodology/approach This paper mainly relies on statutes and court cases as its primary sources of information. It is supported by secondary data to justify the analysis. This paper also uses an analytical descriptive approach to analyse relevant provisions from statutes and to examine current court cases regarding the implementation of the AML obligations on bankers. Findings It is submitted that the AML legislation imposes a significant burden of reporting requirements on the bankers, failure of which may justify the dismissal or termination of their services. In other words, the law has not only altered the way bankers deal with their customers but also poses substantial legal risks to their security of tenure. Indeed, getting the right balance between the need to combat money laundering and the interests of bankers is a difficult exercise. Originality/value This paper provides an analysis of the liability of bankers under Malaysian AML laws. It is hoped that the content of this paper can provide some insight into this particular area for bankers, enforcement authorities, practitioners, academics, policymakers and legal advisers, not only in Malaysia but also elsewhere. The findings of this paper also highlight the risks that bankers may face for non-compliance with the reporting obligations under the AML laws.

An analysis of the forfeiture regime under the anti-money laundering law

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Aspalella A. Rahman
Keyword(s):  
Money Laundering ◽  
Secondary Data ◽  
Primary Sources ◽  
Court Cases ◽  
Sources Of Information ◽  
Content Type ◽  
Terrorism Financing ◽  
Bona Fide ◽  
Descriptive Approach ◽  
Insight Into

Purpose This paper aims to analyze the forfeiture regime under the Malaysian anti-money laundering law. Apart from discussing the relevant provisions, several court cases also were examined to identify the problems which arise in the implementation of such a powerful forfeiture regime. Design/methodology/approach This paper mainly relies on statutes and court cases as its primary sources of information. It is supported by secondary data to justify the analysis. This paper also used analytical descriptive approach to analyze relevant forfeiture provisions from statutes and to examine current court cases regarding the implementation of the forfeiture regime. Findings The Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (AMLATFPUAA) provides comprehensive procedures for the forfeiture of criminal proceeds. Any limitations of the previous statutory legislations have been addressed, and more importantly, the AMLATFPUAA introduces more powerful and innovative measures that can facilitate the recovery of illegal proceeds from money laundering and any other serious crimes. The AMLATFPUAA also provides avenue for the bona fide third parties to contest the forfeiture order. However, it appears that such right is not easy to be enforced. Originality/value This paper provides an analysis of the forfeiture regime under Malaysian anti-money laundering laws. It is hoped that the content of this paper can provide some insight into this particular area for enforcement authorities, practitioners, academics, policymakers and legal advisers not only in Malaysia but also elsewhere. The findings of this paper also expose any weakness or lacunae in the aspects of application and implementation of the forfeiture regime. Thus, more effective and workable legal solution especially on the issue of civil forfeiture of criminal assets could be considered for further accomplishment.

The essential role of the investigation in fighting economic crime in Italy

2016 ◽  
Vol 23 (2) ◽  
pp. 465-480 ◽  
Author(s):  
Domitilla Vanni
Keyword(s):  
Money Laundering ◽  
Comparative Method ◽  
Economic Crime ◽  
European Convention ◽  
Right To Privacy ◽  
Content Type ◽  
Community Law ◽  
The Law ◽  
Financing Of Terrorism ◽  
The Right

Purpose This paper aims to analyse the evolution of European anti-money laundering discipline passing from the First Money Laundering Directive 91/308/EEC, that was only referred to banks and financial intermediaries, that has been furthermore extended to some activities and professions outside the financial sector. The research examines the different steps done buy Italian Legislation in the field of economic crime: at first Law n. 14/2003 of 3 February 2003 (Community Law 2002), they transposed the 2001 Directive 2001/97/EC and then the Law n. 56/2004 of 20 February 2004, that has implemented Directive 2001/97/EC. Now it is urgent to implement Directive 2005/60/EC that has extended the scope of the legislation, including the fight against the financing of terrorism and modified anti-money laundering obligations. Design/methodology/approach This paper deals with the Legislations of some European States (in particular UK and Italy) interpreting them by a comparative method. Findings This paper has put in clear some differences and some analogies between national legislations of different countries. Research limitations/implications In Italy, at first Law n. 14/2003 of 3 February 2003 (Community Law 2002), has transposed the 2001 Directive 2001/97/EC and then the Law n. 56/2004 of 20 February 2004, has implemented Directive 2001/97/EC. In 2005, Directive 2005/60/EC has extended the scope of the legislation, including the fight against the financing of terrorism and modified anti-money laundering obligations. Practical implications In the context of economic crime, capital investigations represent one of the most effective tools to fight the activities of organized crime in the phase of managing wealth illicitly produced and its immission in the circuit of the legal economy. Social implications The need of fighting economic crime must always be harmonized with the protection of right to privacy that has been acknowledged by Article 8 of the European Convention of Human Rights of 1950 as a fundamental right. Originality/value This paper develops the need to balance the right to privacy of every European citizen (Article 8 CEDU) with investigative power exercised by Public or Private Authorities, considering the possibility to comprise the first – if necessary – to allow the regular exercise of the second.

Combating money laundering and the future of banking secrecy laws in Malaysia

2014 ◽  
Vol 17 (2) ◽  
pp. 219-229 ◽  
Author(s):  
Aspalella A. Rahman
Keyword(s):  
Money Laundering ◽  
Primary Sources ◽  
Sources Of Information ◽  
Policy Makers ◽  
Effective Prevention ◽  
Content Type ◽  
Banking Secrecy ◽  
Terrorism Financing ◽  
Flow Of Information ◽  
Proper Balance

Purpose – The purpose of this paper is to analyze banking secrecy laws against the background of the Malaysian anti-money laundering laws. It has been argued that the anti-money laundering law makes greater inroads into the banking secrecy rule when compared to the common law or other statutes. Banks can disclose customer’s information on even grounds of suspicion of money laundering. Banking secrecy is a customer privilege, whereas combating money laundering is critical for public safety and security. Indeed, achieving a proper balance is a desirable goal. But how do we go about achieving such a balance is a question encountered by many law enforcement authorities. This paper looks into these issues. Design/methodology/approach – This paper mainly relies on statutes as its primary sources of information. As such, the relevant Malaysian laws that provide the banking secrecy rule will be identified and analyzed. It will be necessary to examine the banking secrecy rule in the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (AMLATFA) and other relevant statutes in detail, as these are the most important legislation for the purpose of this paper. Findings – On closer inspection, it is submitted that AMLATFA provides sufficient safeguards to ensure that the disclosure of customer’s information is carried out in a manner that is not prejudicial to the interest of legitimate customers. This is a positive approach that could protect the innocent customers from being mistreated by the law. Ultimately, it can be said that the growing threat of global money laundering and terrorism makes the overriding of banking secrecy justified because without a flow of information from the banks, the effective prevention of the menace is not possible. Originality/value – This paper analyzes the inroads into the banking secrecy rule under the Malaysian anti-money laundering laws. It would provide some guidelines into this particular area for academics, banks, their legal advisers, practitioners and policy makers, not only in Malaysia but also elsewhere.

The impact of reporting suspicious transactions regime on banks: Malaysian experience

2013 ◽  
Vol 16 (2) ◽  
pp. 159-170 ◽  
Author(s):  
Aspalella A. Rahman
Keyword(s):  
Money Laundering ◽  
Primary Sources ◽  
Sources Of Information ◽  
Policy Makers ◽  
Content Type ◽  
Effective Implementation ◽  
Terrorism Financing ◽  
The One ◽  
The Impact ◽  
Insight Into

PurposeReporting suspicious transactions under anti‐money laundering (AML) laws creates a major dilemma for banks. On the one hand, failure to report suspicious transactions is an offence under the laws. On the other hand, if they report the transaction, they may breach their duty of confidentiality to their customer or could be liable for tipping off the suspected customer. More importantly, it can also undermine customers' trust. The purpose of this paper is to look into these issues and analyse them against the background of the Malaysian AML laws.Design/methodology/approachThis paper mainly relies on statutes as its primary sources of information. As such, the relevant Malaysian AML that affect the reporting obligations will be identified and analyzed. It will be necessary to examine not just the provisions of the Malaysian Anti‐Money Laundering and Anti‐Terrorism Financing Act, but also its regulations and guidelines which affect banks in detail, as this is the most important legislation for the purpose of this paper.FindingsIt is apparent that the reporting suspicious transactions regime has had a significant impact on the operations of banks in Malaysia. While the regime is based on sound principles, the effectiveness of the regime is still unknown. As such, only time will tell whether the banks will be able to cope sufficiently with the increased AML obligations. Obviously, it is critical at this stage, to establish effective coordination between legislators, regulators and the banking industry, in order to minimize problems faced by the banks and thereby to ensure effective implementation of the regime.Originality/valueThis paper provides an examination of the impact of the reporting suspicious transactions regime on Malaysian banks. It is hoped that the study would provide some insight into this particular area for academics, banks, their legal advisers, practitioners and policy makers, not only in Malaysia but also elsewhere. In view of the international nature of money laundering and banking, there will be significant interest in how the AML laws affect banks operating in Malaysia.

Conceptualizing terrorist financing in the age of uncertainty

2016 ◽  
Vol 19 (4) ◽  
pp. 397-406
Author(s):  
Zaiton Hamin ◽  
Rohana Othman ◽  
Normah Omar ◽  
Hayyum Suleikha Selamat
Keyword(s):  
Money Laundering ◽  
Task Force ◽  
Secondary Data ◽  
Penal Code ◽  
Primary Sources ◽  
Content Type ◽  
Secondary Sources ◽  
Online Databases ◽  
International Policies ◽  
Terrorism Financing

Purpose The purpose of this paper is to conceptualize the concept of terrorism, terrorism financing, the relationship between money laundering and terrorism financing and the governance of terrorism financing. Design/methodology/approach This paper adopts a doctrinal, content analysis and secondary data, of which the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 and the Penal Code are the primary sources. The secondary sources for this paper include articles in academic journals, books and online databases. Findings Several methods are involved in the commission of terrorism financing such as raising, moving and using of funds. The activities relating to terrorism financing under the Penal Code are broader than such activities. Despite the adherence by Malaysia to international policies established by the Financial Action Task Force, terrorism financing has remained a threat that must be addressed by the relevant authorities. Practical implications This paper could be a useful source of information for the practitioners, academicians, policymakers and students studying this particular area of crime. Originality/value This paper contributes to a discourse on terrorism financing in the Malaysian context.

Coopetition in social entrepreneurship: a strategy for social value devolution

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Leandro da Silva Nascimento ◽  
Júlio César da Costa Júnior ◽  
Viviane Santos Salazar ◽  
Adriana Fumi Chim-Miki
Keyword(s):  
Social Entrepreneurship ◽  
Secondary Data ◽  
Social Enterprises ◽  
Social Value ◽  
Primary Sources ◽  
Content Type ◽  
Social Sphere ◽  
Cooperation Level ◽  
The Social ◽  
Competition Level

PurposeCoopetition is a well-studied phenomenon in traditional enterprises. However, it lacks deepening in the social sphere, specifically on hybrid organizations (social and commercial goals). This paper analyzes the configuration of coopetition strategies in social enterprises and how these strategies can improve social value devolution.Design/methodology/approachThe authors conducted a multicase study with Brazilian social enterprises and a social incubator. Semistructured interviews with founders of the social enterprises and the president of the incubator were the primary sources of evidence, supported by observations and secondary data.FindingsThe authors identified four main findings: (1) the social incubator induces coopetition among social enterprises; (2) coopetition is necessary to improve market performance; (3) coopetition is a natural strategy resulting from the activity of the social enterprise; (4) the behavior and context of social enterprises generate a new framework for coopetition formation. This framework comprises three stages of value: a social cooperation level to co-creation of value; second, a social competition level to the appropriation of value; and the third coopetition-balanced level to social value devolution.Originality/valueThe authors advance knowledge on coopetition in an exciting, underexplored context, social entrepreneurship. The authors highlight that the coopetition nature and outcome in social enterprises have specificities compared to traditional businesses. The authors also improve the understanding of social value devolution based on simultaneous cooperation and competition among small social enterprises, allowing theoretical and practical implications. Thus, they advance the recurring discussion in coopetition literature beyond the generation and appropriation of value.

Does holding offshore jurisdictions to higher AML standards really assist in preventing money laundering?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Andrew James Perkins
Keyword(s):  
Money Laundering ◽  
Secondary Data ◽  
Cayman Islands ◽  
Content Type ◽  
Task Forces ◽  
Financial Crimes ◽  
Financial Action Task ◽  
Practical Implications ◽  
Combat Money Laundering

Purpose This paper aims to contend that when tackling financial crimes such as money laundering and terrorist financing, international regulators are seeking to hold offshore jurisdictions such as the Cayman Islands to higher standards and that this detracts from the pursuit of detecting and prosecuting money launders. Design/methodology/approach This paper will deal with the following perceived issues: firstly, to offshore jurisdictions as a concept; secondly, to outline the efforts made by the Cayman Islands to combat money laundering and to rate these changes against Financial Action Task Forces’ (FATAF’s) technical criteria; thirdly, to demonstrate that the Cayman Islands is among some of the world’s top jurisdictions for compliance with FATAF’s standards; and finally, to examine whether greylisting was necessary and to comment upon whether efforts by international regulators to hold offshore jurisdictions to higher standards detracts from the actual prosecution of money laundering within the jurisdiction. Findings Greylisting the Cayman Islands in these authors’ view was something that should have never happened; the Cayman Islands is being held to standards far beyond what is expected in an onshore jurisdiction. There is a need for harmonisation in respect of international anti money laundering rules and regulations to shift the tone to prosecution and investigation of offences rather than on rating jurisdictions technical compliance with procedural rules where states have a workable anti-money laundering (AML) regime. Research limitations/implications The implications of this research are to show that offshore jurisdictions are being held by FATAF and other international regulators to higher AML standards than their onshore counterparties. Practical implications The author hopes that this paper will begin the debate as to whether FATAF needs to give reasons as to why offshore jurisdictions are held to higher standards and whether it needs to begin to contemplate higher onshore standards. Originality/value This is an original piece of research evaluating the effect of FATAF's reporting on offshore jurisdictions with a case study involving primary and secondary data in relation to the Cayman Islands.

Reassessing the contents and context of governance in Asia: recognizing achievements

2019 ◽  
Vol 8 (4) ◽  
pp. 353-363 ◽  
Author(s):  
Ahmed Shafiqul Huque
Keyword(s):  
Good Governance ◽  
Primary Sources ◽  
Political Systems ◽  
Sources Of Information ◽  
Asian Countries ◽  
Content Type ◽  
Secondary Sources ◽  
Alternative Approach ◽  
Ranking Countries

Purpose Good governance has been declared as the key target of most Asian governments, but it appears to be an unattainable objective. The purpose of this paper is to explore the potentials for establishing governance across Asian countries. Drawing upon the literature and experience of Asian countries, the study argues that governance represents an unclear state that is rooted more in perception than reality. An extensive review of the indicators of governance reveals the anomaly and unorganized efforts to measure it, and points to the need for recognizing accomplishments in areas that are not directly or indirectly covered in the existing schemes of assessment. Design/methodology/approach The paper is based on a broad review of the literature on governance and political systems in Asian countries. Existing arrangements for assessing governance are critically reviewed to point out the risks in a perception-dependent approach. Secondary sources and insight obtained from relevant research constitute the data analyzed in the paper. Findings The paper finds that the target of good governance cannot be fully achieved due to the significant diversity across Asian countries as well as varied perceptions held by assessors. Stakeholders have different perceptions about the requirements and ideal of governance and existing tools for measuring governance are inadequate. Most importantly, assessment frameworks do not recognize contextual dimensions that are relevant to Asian countries. Furthermore, it is important to recognize efforts that are aimed at improving conditions instead of working toward an absolute outcome of governance. Recognition of small successes will contribute to the improvement of circumstances rather than ranking countries on the basis of a limited number of perception-based indicators and listing them on international indices. Research limitations/implications The paper does not draw upon primary sources of information and is limited to an assessment of existing arrangements. Practical implications The paper will help draw attention to the limitations of existing arrangements of assessing countries and ranking them for the quality of governance. It will also encourage researchers to think about alternative tools for assessing governance and recognizing progress in Asian countries. Social implications The paper will encourage governments to identify obstacles to good governance and adopt policies to overcome them. Originality/value The paper contributes to the literature presenting a critical view for encouraging alternative approach to governance, incorporating perceptions of diverse stakeholders and highlights the need to recognize progress, however limited, in all areas.

Get-Rich Quick scheme: Malaysian current legal development

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Aspalella A. Rahman ◽  
Ruzita Azmi ◽  
Rosylin Mohd Yusof
Keyword(s):  
Strict Liability ◽  
Primary Sources ◽  
Mens Rea ◽  
Financial Fraud ◽  
Sources Of Information ◽  
Content Type ◽  
Investment Companies ◽  
Quick Scheme ◽  
Wide Range ◽  
Common Facet

Purpose In Malaysia, Get-Rich-Quick scheme (GRQS) is one of the financial fraud activities prohibited under Malaysian law. The common facet of such schemes involves plans that promise unrealistic rates of returns, and this new scheme continues to proliferate every year as the list of illegal investment companies and websites are growing. Indeed, GRQS will remain proliferating as long as there are people who are easily lured by the promise that wealth can be generated with little skill, effort or time. This paper aims to explain the phenomenon of GRQS in light of the existing laws in Malaysia. This paper also highlights the current development of Australian law pertaining to GRQS for comparative purpose. Design/methodology/approach This paper mainly relies on statutes as its primary sources of information. As such, this paper analyses the scope and provisions of the relevant laws that regulate GRQS and compare the existing GRQS provisions that are equivalent with Australian law. Findings Malaysia has comprehensive laws to combat GRQS activities. However, these laws are far from perfection, and only with immediate amendments, GRQS problems can be resolved more effectively. One of the weaknesses of current Malaysian laws to tackle GRQS is the lack of more stringent punishment against the operators of GRQS as well as the participants of the scheme. A comparison with equivalent GRQS law in Australia demonstrates that Australian laws provide a wide range of punishment to the operators and prohibits participation in GRQS. More importantly, Australia regards the offense as a strict liability offense where the mens rea or guilty mind of the perpetrators is exempted. Indeed, numerous proceedings have been instituted in the Australian Court against the operators and participants of GRQS. Originality/value This paper analyses the scope of relevant laws in Malaysia to combat GRQS and examines the strengths and weaknesses of these laws. This paper also compares Malaysian law with equivalent GRQS-related laws available in Australia. This paper further suggests that Malaysia should regulate sterner punishment for operators and participants of the scheme and that the offense is categorized under a strict liability offense where the mens rea or guilty mind of the offender is exempted.

Tackling money laundering in Tanzania: are private legal practitioners crime enablers or ineffectual and reluctant gatekeepers?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Eugene E. Mniwasa
Keyword(s):  
Money Laundering ◽  
Research Approach ◽  
Related Factors ◽  
Policy Makers ◽  
Content Type ◽  
Legal Reforms ◽  
The Law ◽  
Media Reports ◽  
Legal Frameworks ◽  
Law Reports

Purpose This paper aims to examine the money laundering vulnerability of private legal practitioners in Tanzania, the involvement of these practitioners in money laundering activities and their role in preventing, detecting and thwarting money laundering and its predicate crimes. Design/methodology/approach The paper applies the “black-letter” law research approach to describe, examine and analyze the anti-money laundering law in Tanzania. It also uses the “law-in-context” research approach to interrogate the anti-money laundering law and to provide an understanding of factors impacting on the efficacy and readiness of private legal practitioners in Tanzania to tackle money laundering. The review of literature and analysis of statutory instruments and case law, reports of the anti-money laundering authorities and agencies and media reports-generated data are used in this paper. This information was complemented by data from interviews of purposively selected private legal practitioners. Findings Private legal practitioners in Tanzania are vulnerable to money laundering. There is an emerging evidence that indicates the involvement of some private legal practitioners in the commission of money laundering and/or its predicate crimes. The law designates the legal practitioners as reporting persons and imposes on the obligation to fight against money laundering. Law-related factors and practical challenges undermine the capacity of the legal practitioners to curb money laundering. Additionally, certain hostile perceptions contribute to the legal practitioners’ unwillingness, indifference or opposition against the fight against money laundering. Research limitations/implications The paper underscores the need for Tanzania to reform its policy and legal frameworks to create enabling environment for anti-money laundering gatekeepers, including private legal practitioners to partake efficiently in the fight against money laundering. It also underlines the importance of incorporating the principles that govern the private legal practise to enable the practitioners to partake effectively in tackling money laundering. Originality/value This paper generates useful information to private legal practitioners, policy makers and academicians on issues relating to money laundering and its control in Tanzania and presents recommendations on possible policy and legal reforms that can be adopted and applied to augment the role of the legal practitioners in Tanzania to combat money laundering.

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