Banking’s reporting mechanism needs to improve to curb crimes

‘Bankers should act upon their duty as the 1st line of defence and further quiz transactions that do not comply with due diligence requirements’


The banking sector needs to improve its reporting mechanism for suspicious transactions in order to tackle money laundering and terrorism financing activities.

Al Rajhi Banking & Investment Corp (M) Bhd chief compliance officer V Maslamani (picture) said bankers should act upon their duty as the first line of defence and further quiz transactions that do not comply with due diligence requirements.

“The 1Malaysia Development Bhd (case), which was a taboo, could have been avoided if everyone involved raised their voices.

“If this had been the case, then Malaysia today would not be synonymous with the word ‘kleptocracy’,” he said at the press conference and sponsorship signing ceremony of the 10th International Conference on Financial Crime and Terrorism Financing (IFCTF) 2018 in Kuala Lumpur yesterday.

Maslamani, who is also the organising chairman of IFCTF, added that the current exposé on cases related to financial crimes will boost confidence among financial institution personnel to report any dubious transaction.

“Before this, the public would not dare to voice out, especially those in the government sector.

“Today, we hope that they are more empowered to take action and make a difference by making a report. The institutions have to keep on imprving and these changes will not take a day,” said Maslamani.

Commenting on the upcoming Budget 2019, to be tabled on Nov 2, Maslamani said more funding could be allocated towards enhancing enforcement in curbing financial crimes.

“The government could look at better allocation for enforcement agencies, especially the Malaysian Anti-Corruption Commission, to allow them to spend on more innovative mechanisms in enhancing their findings.

“Increasing manpower could be another way to go. For example, the banks receive thousands of transactions a day and we could not look at them all,” he said.

Maslamani added that Malaysia is in need of better enforcement of the laws relating to financial crimes and terrorism financing as the country is already furnished with the right regulation.

“In Malaysia, we have the National Coordinating Council which comprises relevant agencies. We just need to improve the enforcement part as we have all the laws.

“To do so, we need to strengthen the front lines, which are the bankers who are in direct contact with financial criminals,” he said.

Maslamani also said a good barrier has to be put in place in determining financial criminals as detecting them remains a challenge globally.

“Financial crimes and terrorism financing remain a challenge for this region and globally. Banks have to remember their roles as front liners in dealing with the potential criminals who pose as customers.

“We need to have a strong measure of barrier to distinguish the criminals from the customers as they do not come with a sign on their forehead,” he added.

Meanwhile, the Asian Institute of Finance will be organising the 10th IFCTF, to be held from Oct 30 to 31, at Shangri-La Hotel, Kuala Lumpur.

The two-day conference is expected to receive more than 1,000 participants including bankers, corporates officers, financial consultants and enforcement officers.

The conference will discuss topics such as compliance in the financial service sector, domestic efforts in combating terrorism financing and anti-money laundering risk assessments.

Bank Negara Malaysia governor Datuk Nor Shamsiah Mohd Yunus is expected to deliver a keynote address titled “Reshaping Malaysia’s Future — Setting the Goal for Greater Governance and Transparency” at the conference.