Malaysia to Place Bitcoiners Under Existing Anti-Money Laundering Laws

In order “to prevent the abuse of the system for criminal and unlawful activities and ensuring the stability and integrity of the financial system,” Bank Negara Malaysia Governor Tan Sri Muhammad Ibrahim stated 22 November 2017 that those trading in cryptocurrencies will be placed under the country’s existing anti-money laundering laws.

Also read: Malaysia’s Central Bank to Decide on Crypto Regulation at Year’s End

Malaysia Cites Terrorism Fear
Joseph Chin of The Star Online reports, “Bank Negara Malaysia is developing the regulatory structure for digital currencies, and from 2018 persons converting crypto currencies into fiat money currencies will come under anti-money laundering law,” he notes. Such persons “would be designated as reporting institutions under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.”

The central bank’s Governor made his remarks at the Third Counter-Terrorism Financing Summit. It’s a four day conference organized by the bank, partnering with “Australia’s financial intelligence agency, AUSTRAC, and Indonesia’s Pusat Pelaporan dan Analisis Transaksi Keuangan (PPATK),” the website press release read.Malaysia Terrorism Fears Place Bitcoiners Under Anti-Money Laundering Laws

The gathering brings “together more than 350 specialists and professionals from 35 countries and international organisations to share their insights on the latest terrorism financing (TF) issues and developments,” they emphasize.

Mr. Ibrahim’s talk was titled, Readying the Financial Sector Amid the Evolving War on Terrorism Financing, saying in part, “regulators must prepare themselves as digital currencies will become the new norm,” The Star Online paraphrased.

“We must harness the vast potential in technological innovations,” the central banker warned, “to reinvent and reinforce our lines of defence.”

Malaysia Terrorism Fears Place Bitcoiners Under Anti-Money Laundering Laws

New Tools
Terrorism in Malaysia has a storied and long history, and is beyond the scope of the present article. But it is safe to write terrorism is something the Malaysian government can claim as a concern, regardless of it as pretext in the case of bitcoin.

“We need new tools,” Mr. Ibrahim said. “The adoption of artificial intelligence, machine learning, and big data technology are tools that would likely be imperative, as suspicious transactions become more complex and harder to detect,” he listed.

The Star Online notes further how the central bank head “said the advent of digital currencies, as some have forecast, will mark the beginning of a new era in the financial sector.”
Remittances Come Under Scrutiny
One undeniable area of bitcoin’s power resides in its ability to essentially be borderless, allowing those who wish to send money back to their home countries a frictionless experience for the most part.

Mr. Ibrahim is reported to have said “Bank Negara was in the midst of finalising the details of a new requirement for the Banking and Money Services Business sector to report remittances in high risk areas.”

“The high risk areas will be determined based on the law enforcement agency’s intelligence on areas that they view may pose higher risks for funding of terrorism activities,” The Star Online summarized.