ANTI-MONEY LAUNDERING AND ANTI-TERRORISM FINANCING OBLIGATIONS FOR THE MONEY SERVICES BUSINESS IN MALAYSIA: AN APPRAISAL

Abstract

The money services business (MSB) is a financial institution comprising money-changing business, remittance business and wholesale currency business. As a financial institution, the MSB is subjected to the anti-money laundering and counter financing of terrorism (AML/CFT) requirements in Malaysia. Thus, the objective of this article is to examine the AML/CFT legal requirements to the MSB sector in Malaysia. This study employed doctrinal legal research by analysing the primary and secondary legal sources. Thus, this study analyses the importance of AML/CFT preventive measures, which are (i) risk-based approach; (ii) customer due diligence; (iii) record-keeping; (iv) suspicious transaction report; and (iv) AML/CFT compliance programme. Despite the AML/CFT statutory obligations, the study found that the MSB is at high risk for these crimes due to the lack of AML/CFT compliance. Thus, having continuous compliance and rigorous enforcement by authorities is necessary for combating these organised crimes.