ANTI-MONEY LAUNDERING COMPLIANCE BY THE REMITTANCE INDUSTRY IN MALAYSIA

Money services business (MSB) consists of remittances companies and money changer sector which produce an enormous of remittance flows based on large population of legal and illegal migrants in Malaysia. The remittance system is categorized as one channel to transfer the funds around the world. Such system is often used by the migrant workers through the traditional banking method, MSB or underground banking system (hawala). However, criminals tend to using remittance system to launder their illicit gains and profit as the money can move quickly in a cheap cost. Since 2007 the remittance sector include as a reporting institution in Malaysia need to adhere statutory obligations imposed such as record keeping, due diligence, reporting suspicious transaction and compliance program within company. In the context of this study, the authors will discuss the extent of level of compliance by the remittance sector to the money laundering legislations in Malaysia. This paper engages a qualitative data of which the primary data is obtained from six case studies of remittance sector within Klang Valley. The preliminary finding indicates that the remittance sector need to bear the high cost of compliance despite of their purpose as profit making entities. This paper could be a useful source of information for the MSB sector, policymaker, academicians, and students in this particular area of crime. (c) 2018 Published by Future Academy www.FutureAcademy.org.UK