THE LATEST REGIONAL TRENDS IN CORRUPTION AND EFFECTIVE
COUNTERMEASURES BY CRIMINAL JUSTICE AUTHORITIESPremraj a/l Isaac Dawson Martin Victor *I.

STATISTICS AND LATEST CORRUPTION TRENDS

Since 2015 there has been a huge volume of Investigation Papers (IP) opened by the
Malaysian Anti-Corruption Commission (MACC), based on reports lodged against
wrongdoings, pertaining to corruption and money laundering incidences. Below are thenumbers of IPs opened based on the category of offences in the MACC 2009 Act since 2015:
CATEGORIES OF OFFENCES

2015

2016

2017

2018 *(till Sept)

RECEIVING GRATIFICATION(s. 16/17 MACC Act 2009)

400

331

311

206

GIVING GRATIFICATION(s. 17 (b) MACC Act 2009)

156

140

168

68

FALSE CLAIM(s. 18 MACC Act 2009)

241

367

202

246

ABUSE OF POWER(s. 23 MACC Act 2009)

67

89

81

98

MONEY LAUNDERING(AMLATFPUAA 2001)

39

26

51

52

OTHER OFFENCES(PENAL CODE)

79

32

50

58

TOTAL (Investigation Papers)

982

985

863

728

Looking into the above-stated information regarding money-laundering activities, recent
trends show the number of IPs opened has increased almost 100 percent in 2018, as compared
to 2016. This fact proves that the MACC is seriously combating money-laundering activities,
which entails the enforcement of seizure, freezing and forfeiture of illegally obtained assets.
MACC is also combating illicit enrichment committed by white-collar offenders throughmoney laundering activities. Attached herewith are statistics, showing drastic enforcement offorfeiture as a result of seizure. The tables below show both the amount of seizure during
investigation (Table 1) as well as amount of forfeiture (Table 2) in the four years prior to*

Assistant Commissioner, International Relations Branch, Policy, Planning and Research Division, MalaysianAnti-Corruption Commission (MACC).

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May 2018. These figures raise an alarm to the public that the government is serious infighting against the predicate offence of money laundering and corruption offences.
Table 1- Seizure
AMOUNT OF SEIZURE (MYR)
YEAR

MACCA 2009
(A)

AMLATFPUAA
2001
(B)

TOTAL (A+B)

2015

12,938,824

9,331,769

22,270,593

2016

121,778,504

85,877,708

207,656,212

2017

60,021,799

293,038,548

353,060,347

2018(till mid Oct)2,362,537

16,084,625

18,447,162

TOTAL

197,101,664

404,332,650

601,434,314

Table 2- Forfeiture
AMOUNT OF FORFEITURE (MYR)
YEAR

MACCA 2009/
CPC(C)

AMLATFPUAA
2001
(D)

TOTAL (C+D)

2015

1,436,135

2,500,900

3,937,035

2016

4,947,124

3,000

4,950,124

2017

28,026,190

20,529,275

48,555,465

2018(till mid Oct)

1,344,693

15,526,904

16,871,597

TOTAL

35,754,142

38,560,079

74,314,221

Even though the amount of forfeiture is much less than the amount of seizure, it still
positively shows that the volume of forfeiture has increased year by year. If we were to
analyse the trend of arrest, the arrested offenders have been recorded as follows:- 84 -

ARREST STATISTICS
2015

2016

2017

2018
(till Sept)

Top Management
Senior Management
Supporting Staff

9
82
307

7
119
341

13
101
295

2
111
210

Government Linked Companies

n/a

22

21

21

Private Sector

127

210

168

133

Public

316

238

272

200

Others

0

2

9

10

TOTAL

841

939

879

687

CATEGORIES OF OFFENDERS
PublicSectorData of arrest as shown above alarms us that the allegation regarding involvement of the
public sector is quite high, as compared to the other categories of offenders. Having said that,the allegations against public sector offenders may be the result of the fact that their positions
are vulnerable to corruption, misappropriation and abuse of power.
II. CHARACTERISTICS AND TYPOLOGIESBasically, there are four most common modus operandi committed by the offenders,
namely:A. Misuse of Public Funds(OPS MISDEC)
The accused was an Executive Director of the Skills Development & Entrepreneurship
Centre together with his son, who was also working in the same centre, as a Director in the
Administration and Finance Division. The accused and his son committed criminal breach oftrust by issuing several payments through numerous cheques from the Skills Development &Entrepreneurship Centre to their own company, named MRP LTD, amounting to RM4.5
million. The main objective of the centre is to provide facilities in technical and management
training programmes in order to upgrade the competencies in skills and technology where thefinancial budget is from the federal government. The funds were only to be used for theorganization’s intended purpose. Both accused had misused the advantage of being directors
in the centre.
B. Involvement of a Huge Amount of Cash
(OPS WATER)
The accused in this case was a Deputy Director of a state government department.
During investigation, a huge amount of cash worth MYR1.5 million was found and seizedfrom his own dwelling house. Besides that, several mixed foreign currencies were also foundamounting to MYR1,978,760.48 inside the house. Additional cash in the amount of
MYR12,500.00 was found inside his office. Surprisingly, MYR4.4 million in cash was found- 85 -

inside safe deposit boxes, from various banks, registered under his name.
C. Involvement of Lawyers and Dummy Documents(OPS SKYLINE)The accused was a Junior Minister in a southern state who had power regarding approvalof housing development. He and the co-accused, a businessman, had approached housingdevelopers, who had applied for a release. In this case, state government has imposed certain
conditions on housing developers, where they are required to allocate 40% of the units to be
sold to Bumiputra (a Malaysian of indigenous Malay origin) at a discounted price (15% off
from normal purchase price). For a certain period, if the units are unsold, the developers may
apply for a release, so that the unsold units could be sold to non-Bumiputra at a normal price.
In approving the application, the developer would be charged to pay a certain amount to a‘state housing fund’ up to 7.5% of the purchase price. Here, the accused, had reduced theamount to be paid by the developers to 3% only and another 3% as a kickback to the accused.
In this case, the co-accused had engaged a lawyer to prepare a standard agreement
between him and the developers. It is said in the agreement that the ‘kickback amount’ waspayable from the developers as a consultancy fee, which those developers denied.
(OPS BALDI)
The accused was a CEO in a government-linked company (GLC). He had committed
criminal breach of trust by way of issuing several company’s cheques to a few contractors
who had been awarded projects with the GLC. The total amount involved was worth MYR2.5
million. The modus operandi was similar among the contractors, where he instructed them tofalsify invoices so that payment could be made to them. After that, those contractors had towithdraw the same amount and give it to the accused in cash. In issuing those relatedcheques, he had wrongly instructed the General Manager of Finance of the GLC, to sign thecheques, ‘supposedly to pay GLC’s clients, which the clients denied.
D. Involvement of Proxies(OPS SKYLINE)
As mentioned earlier about the case, the payments made by the developers were
deposited into the lawyer’s client account. Immediately after that, the lawyer will transfer themoney to another company’s account which belongs to the Junior Minister. However, thecompany was registered and run by another person (proxy to the minister). Evidence showsthat some properties were purchased thereafter by the company yet were being used by the
Junior Minister.
III. EFFECTIVE COUNTERMEASURES
A. Effective Countermeasures for Preventing Corruption
1. Corruption-Free Pledge / Ikrar Bebas Rasuah (IBR)
The corruption-free pledge is a pledge of commitment to participate in combating
corruption and abuse of power. IBR is an initiative that has been implemented by the MACC
for the purpose of emphasizing and enhancing the commitment to avoid and liberate any
corrupt conduct. It has been implemented in various ministries and government agencies(including government-linked companies), as well as in the private and corporate sectors.

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2.

Integrity Units
The establishment of Integrity Units in government agencies is in accordance with
Service Circular No. 6 Year 2013 effective on 1st January 2013. The objective of Integrity
Units is to integrate all integrity matters under a specific unit in more planned and focusedmanner. The main function of Integrity Units is to deal with integrity matters in theorganization with the responsibility to carry out six (6) core functions stated in the circular as
follows:a) Governancec) Detection and Verificatione) Complianceb) Integrity Enhancementd) Complaint Managementf) Disciplinary

B. Effective Countermeasures for Investigating, Prosecuting and Adjudicating
Corruption
1. Intelligence-Based Investigation (IBI)
MACC has adopted the Intelligence-Based Investigations (IBI) approach with the aim ofbeing more effective in the criminal justice system, where the information is gathered andplaced in a systematic manner. This approached has been adopted and successfully
implemented since 2008. Hence, MACC has to have full cooperation and assistance fromother relevant government agencies in order to gather the relevant evidence.
2.

Managing Team-Based Investigation (MTI)The MACC Investigation Department plays a vital role in the mission to combat
corruption and to implement one of MACC’s core functions, namely investigation. Case
investigations are carried out in group via the Management Team-Based Investigation (MTI)
method to expedite the investigation process as well as produce a more transparent andquality Investigation Paper.
3.

Special Corruption Courts
Since a few years back, Malaysia has implemented Special Corruption Courts in every
state of the country. Every corruption case is registered and centralized in one special court,
equipped with knowledgeable and experienced judges, in order to expedite the case. A
special training programme is being promoted, annually by the Chief Registrar’s Office inorder to enhance and improve the legal understanding among judges.
Meanwhile, in MACC, few dedicated Deputy Public Prosecutors are stationed in each
MACC state office in order to have easy access between the Investigation Officer and Deputy
Public Prosecutors. Investigation teams easily get legal advice from the prosecution side,from time to time, in order to conclude investigations. This is also known as one of thecriteria of MTI.
4.

Anti-Money-Laundering Charge
Most of the cases in MACC are being simultaneously investigated for predicate offences
and anti-money-laundering offences. Hence, the decision to prosecute will also be madetogether. If there is a case, the Deputy Public Prosecutor’s Office will issue consent toprosecute for both offences, and they will be tried jointly. One of the most significant aims is
to ensure that the illegal proceeds from corrupt practices could be eventually forfeited.
Therefore, it would be as a deterrent effect to the public at large, not to commit the same in
the future.

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5.

Forfeiture of Property
In MACC, there is a special unit handling cases for forfeiture of property. This unit has
been established for the purpose of forfeiting assets seized and frozen during investigation.
Basically, this unit will only handle assets which are not directly related to crimes for which
the offender is prosecuted. The investigation team in this special unit will gather all relevant
information and analyse them before pursuing civil forfeiture proceedings. The Investigation
Team on the other hand will consider criminal forfeiture which is directly linked to the court
charges.
There are some occasions in which it is difficult to charge the accused with a crime inconnection with the seized and frozen assets. Currently, white-collar criminals are creative byengaging proxies in connection with the proceeds of bribes or misappropriation of properties.
They will use others’ names in acquiring or registering illicitly obtained properties. Besides
that, they will keep cash notes in certain hidden areas. There are cases where investigation
teams have found money inside tires the booth of a car, an unused residence, and inunsuspected areas in the accused’s dwelling house such as the ceiling, under the bed, stuffed
inside unused luggage bags and others. For instance, in the case of Ishak Ismail, who worked
as Senior Assistant Engineer at the State Public Works Department, Ismail had been foundwith MYR1.1 million (USD265,000) in cash inside his own bedroom. The accused was only
working as support staff of a department, and he only earned around MYR5,000.00(USD1250) a month.
6.

Sentencing
In preventing corruption offences from happening further, the Deputy Public
Prosecutor’s Office had tried their level of best in praying for severe sentences at the end ofeach case. Should the sentence be manifestly inadequate, the Office files appeals before ahigher court.
The MACC Act 2009 provides sentences under section 24, as follows:(1)

Any person who commits an offence under sections 16, 17, 20,
21, 22 and 23 shall on conviction be liable to—(a) imprisonment for a term not exceeding twenty years; and(b) a fine of not less than five times the sum or value of thegratification which is the subject matter of the offence,
where such gratification is capable of being valued or is of apecuniary nature, or ten thousand ringgit, whichever is thehigher.

(2)

Any person who commits an offence under section 18 shall on
conviction be liable to—(a) imprisonment for a term not exceeding twenty years; and(b) a fine of not less than five times the sum or value of thefalse or erroneous or defective material particular, wheresuch false or erroneous or defective material particular iscapable of being valued, or of a pecuniary nature, or ten
thousand ringgit, whichever is the higher.

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For example, in the case of Datuk Khalid Bin Omar (the accused), who was a Director at
the State Public Works Department, Datuk Khalid Bin Omar had been charged for corruptly
receiving gratification (13 charges) from several contractors who had been awarded certain
projects with the department. Besides that, the accused had corruptly received certain
valuable things from those contractors. In addition, he was also charged with offences ofmoney laundering (15 charges). At the end of the case, he was convicted and sentenced to 15
months for each corruption case and 15 months for each anti-money laundering case. He wasalso ordered to pay a fine worth MYR36 million.
In another case, Dr. Shahanum bin Uthman (the accused), who worked as Head of
Project and Service Department in a private company, had committed bribery by receiving
gratification from a copper shabby collector. The collector had a job collecting copper shabbyfrom the company. The gratification was as inducement to the accused in order to give a
discount price for the collected copper shabby. He was convicted on 14 charges andsentenced to imprisonment for cumulatively 29 years and a fine MYR5.4 million. In themeantime, Session Court Judge also ordered the forfeiture of several assets, such as a BMW
car and a few sets of jewelry, to the Government of Malaysia.
C. Effective Asset Recovery
By virtue of section 31 of the MACC Act 2009, the law provides power to:(a) enter any premises and search for, seize and take possession of, any book, document,
record, account or data, or other article;(b) inspect, make copies of, or take extracts from, any book, document, record, accountor data;(c) search any person who is in or on such premises, and for the purpose of such searchdetain such person and remove him to such place as may be necessary to facilitatesuch search, and seize and detain any article found on such person;(d) break open, examine, and search any article, container or receptacle; or(e) stop, search, and seize any conveyance.
In addition, the Act provides further powers to seize movable property (under section 33
of the Act) and to seize immovable property (under section 38 of the Act).
Moreover, the Act also provides the power of forfeiture of property either uponprosecution for an offence (under section 40 of the Act) or where there is no prosecution for
any offence (under section 41 of the Act).
Furthermore, the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds ofUnlawful Activities Act 2001 (AMLATFPUAA 2001) also provides similar power offreezing, seizing and forfeiting properties under Part VI of AMLATFPUAA 2001.
In the case of “OPS SKYLINE”, both of the accused were slapped with 33 charges under
MACC Act 2009 involving gratification amount of MYR34 million, 13 AMLATFPUAA
2001 charges involving MYR17.05 million.

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Several luxurious cars and motorcycles, bungalows and lands were seized during theinvestigation. Those properties are still under proceeding of forfeiture of property under
section 41 of the MACC 2009 Act before the High Court.
In another example in the case of ‘OPS WATER’, the investigation was about allegationsof corruption and misappropriation of funds involving individuals in a state government
department. During the investigation, 28 individuals were arrested including its Director aswell as two ex-Deputy Directors, and 23 engineers. The seizure of cash as well as otherproperties were done in 30 separate locations involving certain districts in the state. The
MACC had taken almost a month to conduct its analysis on 8,000 payment vouchers whichwere extracted from different files consisting of tones of documents. Throughout theinvestigation, the MACC had seized and frozen assets worth MYR 114.5 million including
cash, bank accounts, shares as well as movable and immovable property.
In the case of Ishak Ismail, who worked as a Senior Assistant Engineer at the State
Public Works Department, Ismail has been arrested due to allegations of corrupt practices.
During investigation, the MACC officers had found and seized MYR1.1 million in cash in his
own bedroom. The accused was only working as support staff at the department who earned
around MYR5,000.00 a month. Later, the High Court Judge agreed that the seized amount
was illicitly obtained by the accused and ordered the assets to be forfeited.
D. Effective International Cooperation
Based on strategic cooperation and bilateral understanding, the MACC had acquired
some fruitful information from counterpart enforcement agencies. For example, in the case of
OPS WATER, the MACC had frozen certain assets of the accused in various foreign
financial institutions which were equivalent to MYR62.3 million. In addition, the MACC had
also gained information that the accused had properties outside Malaysia worth more than
MYR9.7 million, consisting of two condominium units, two terrace houses, two studioapartments, an apartment unit, a car parking lot, and a storage lot. For the time being, MACC
has initiated an action to proceed with legal action through Mutual Legal Assistance (MLA).

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