The implementation of AML/CFT regime is coordinated by the NCC, a body established in 2000 to coordinate, implement and monitor the development of the national AML/CFT initiatives.
There are two levels of coordination:
NCC Working GroupOperational level where it involves coordination at the working level to address operational issues pertaining to the implementation and effectiveness of initiatives approved by the NCC High Level. At the operational level, sub-committees and task forces are established to discuss specific issues that require participation of various members.
NCC High LevelFormulates policy, provide advisory role and set out the strategic direction of the NCC. This level comprises of the Heads or Deputies of the member Ministries or agencies
Mandates of the NCC are to:
foster co-operation and promote consultation in the development of AML/CFT policies, legislation, law enforcement and other supporting infrastructures;
co-ordinate the National AML/CFT Risk Assessment initiatives and facilitate good practices with regard to the development, dissemination and implementation of AML/CFT measures;
provide a forum for examining any operational or policy issues that have implications on the implementation, effectiveness and efficiency of the National AML/CFT and, where necessary, to make recommendations to the Government in order to address the issues.
Members of the NCC
Comprised of 16 Ministries and government agencies from supervisory/regulatory authorities, law enforcement agencies and policy-making ministries. Bank Negara Malaysia is the Secretariat for the NCC. Members of the NCC are:
- Attorney General’s Chambers;
- Bank Negara Malaysia;
- Commpanies Commission of Malaysia;
- Immigration Department of Malaysia;
- Inland Revenue Board of Malaysia;
- Labuan Financial Services Authority;
- Malaysian Anti-Corruption Commission;
- Ministry of Domestic Trade, Co-operatives and Consumerism;
- Ministry of Finance;
- Ministry of Foreign Affairs;
- Ministry of Home Affairs;
- Ministry of International Trade and Industry;
- Registrar of Societies;
- Royal Malaysia Police;
- Royal Malaysian Customs Department; and
- Securities Commission Malaysia.
At the international level, Malaysia participates in various regional and international initiatives in its global fight against money laundering and terrorism financing.
Malaysia’s membership in the Asia/Pacific Group on Money Laundering and the Egmont Group of Financial Intelligence Units provides Malaysia with a platform to cooperate in various AML/CFT issues including in the areas of training and sharing of information.
APG is an autonomous and collaborative international organisation formed in 1997 in Bangkok, Thailand. Members of the APG comprise of 41 countries and a number of international and regional observers such as the Financial Action Task Force (FATF), International Monetary Fund (IMF), World Bank, United Nations Office on Drugs and Crime and the Egmont Group of Financial Intelligence Units.
Malaysia has been a member of the APG since 31 May 2000 and supports many initiatives undertaken by the APG such as the following:
- co-chair of the APG, together with Australia from 2000 – 2002;
- co-chair of the Regional Review Group under the FATF International Cooperation Review Group (ICRG) which is mandated to review member countries’ AML/CFT measures identified by the ICRG from 2008 – 2010;
- co-chair of the Implementation Issues Working Group (IIWG) which is mandated to provide strategic support to members in the implementation of the FATF Recommendations from 2006 – 2010; and
- a current member of the APG Donor & Provider Group (DAP) which is mandated to provide technical assistance and advisory services in the region on a range of issues associated with AML/CFT.
As a member of the APG, Malaysia is subjected to periodic assessments or mutual evaluation on compliance with the FATF Standards on AML/CFT. Malaysia was assessed in 2001 and 2007 respectively, and currently scheduled to undertake the third mutual evaluation in the fourth quarter of 2014. The NCC spearheads Malaysia’s preparation for the assessment.
The Egmont Group of Financial Intelligence Units (Egmont Group) is a group of global Financial Intelligence Units (FIUs) established to provide a forum to improve cooperation in the fight against money laundering and terrorism financing and to foster the implementation of anti-money laundering and counter financing of terrorism measures among member countries.
Malaysia was admitted as a member of the Egmont Group in July 2003. Malaysia was also elected as the Asia Chair in the Egmont Committee for two terms (2006/2008 and 2008/2010).
The membership in the Egmont Group provides platform for Malaysia to share and to request financial intelligence with other Egmont Group members through a secured network.
To date, the Egmont Group comprises of 139 FIUs worldwide.
The FATF is an intergovernmental organisation formed in 1989 to develop and promote policies to protect the global financial system against money laundering, terrorism financing and other related threats to the integrity of the international financial systems.
The FATF has developed a series of Recommendations that are recognised as the international standard for combating of money laundering, financing of terrorism and financing of proliferation of weapons of mass destruction.
The FATF monitors countries' progress in implementing the FATF Recommendations through mutual evaluation. The mutual evaluation involves two part assessments:
- the technical compliance assessment that will focus on the adequacy of relevant legal and institutional framework; and
- the effectiveness assessment that will focus on the outcome or effectiveness of the implementation of anti-money laundering and counter financing of terrorism measures.
FATF membership comprises of 34 countries and two regional bodies. There are 8 FATF-style regional bodies:
- Asia/Pacific Group on Money Laundering (APG)
- Caribbean Financial Action Task Force (CFATF)
- Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL)
- Eurasian Group (EAG)
- Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG)
- Financial Action Task Force on Money Laundering in South America (GAFISUD)
- Inter Governmental Action Group against Money Laundering in West Africa (GIABA)
- Middle East and North Africa Financial Action Task Force (MENAFATF)
Malaysia is an ASEAN member since its establishment on 8 August 1967. One of the fundamental principles of the ASEAN is to strengthen the foundation for a prosperous and peaceful community of Southeast Asian Nations. In line with this principle, recognizing the detrimental effects of transnational crime, the ASEAN member countries have established a framework to strengthen and coordinate ASEAN collaboration in combating transnational crime:
- ASEAN Ministerial Meeting on Transnational Crime (AMMTC)
- The policy-making body for ASEAN cooperation in combating transnational crime.
- Senior Officials Meeting on Transnational Crime (SOMTC)
- Implement policies and plans adopted by the AMMTC.
- There are eight areas of transnational crime under the purview of SOMTC which are arms smuggling, cybercrime, illicit drug trafficking, international economic crime, money laundering, sea piracy, terrorism and trafficking in persons. Malaysia is the lead shepherd for money laundering and sea piracy initiatives.
- Ministry of Home Affairs is the coordinating agency for Malaysia’s representation to SOMTC.