NAME : Lew Xue Yin

NO.MATRIC : 256741
LECTURER : Dr. Aspalella Bt A. Rahman
DUE DATE : 10.12.2017 (Monday)
WEEK SIX BANKING SECRECY

Discuss the exceptions of banking secrecy rule under FSA 2013.

The banking secrecy rule has been incorporated in section 133 to 134 of the FSA. The
protection towards the customers has been strengthen as the new Section 133 has been
enacted and this broadens the scope of individuals covered by the said provision compared to
the BAFIA.The exception under Section 97 of BAFIA has been incorporated under the new
Section 133(2) where, the secrecy rule would not apply to information disclosed to Bank,
collection or summary of information set out in such a manner which does not enable
information relating to any particular customer to be ascertained from it or that at the time of
disclosure, the said information has already been made lawfully available to the public from
any source other than the financial institution.

Read the article on Banking Secrecy and Money Laundering (JMLC 2014). Explain the
laws relating to banking secrecyunder FSA 2013 and Anti-Money Laundering Anti-
Terrorism Financing and Proceeds of Unlawful Activities Act 2001.

Bank Secrecy Under FSA 2013

With the coming into effect of the new FSA born, some Act has been repealed including
BAFIA, Payment Systems Act 2003, Insurance Act 1996 and Exchange Control Act 1953.
All the provisions of the repealed Act had been incorporated in the new FSA. Banking
secrecy rules have been applied in Sections 133-134 of the FSA. Protection of the customer
has established new Section 133 has been drafted and is expanding the scope of individuals
covered by those provisions than BAFIA where the term " No person who has access to any
document or information relating to the affairs or account of any customer of a financial
institution... "was used.

The exemption under Section 97 of BAFIA has been incorporated under the new Section 133
(2) where the confidentiality rules will not be used for information provided to the Bank,
collections or summaries information disclosed in any way that allows information pertaining
to any particular the customer to be ascertained from that or at the time of disclosure, the
information has been legally provided to the public from any source other than the financial
institution.
However, the disclosure is permitted are detailed more than 98 parts and 99 BAFIA and any
other exceptions and they are as provided under Section 134 of the new through 11 new
tables that are included together for ease of reference customers. As can be gleaned from the
same thing, the exposure will be presented briefly justified and should not be
misleading. Notwithstanding the exemption granted, banking secrecy under the FSA is still
maintained by virtue of Section 134 (4), which provides that any person who receives any
document or information relating to the affairs or account of customers as permitted under
subsection ( 1) shall not disclose any documents or information to others. It must be an alarm
to all persons acting in violation of this section, where penalties for violations of the law of
secrecy has been lifted. Imprisonment for a term not exceeding five years or a fine not
exceeding RM10, 000,000.00, or both.

Bank Secrecy Under Anti-Money Laundering Anti-Terrorism Financing and Proceeds

of Unlawful Activities Act 2001.

It was established in August 2014, the Anti-Money Laundering and Anti-Terrorism Act 2001
has been replaced by a new name, the Anti-Money Laundering, Anti-Terrorism Financing
and Procurement Act were violated Activities 2001 (AMLATPUA). Confidentiality rules set
out under Part III and IV AMLATPUA that have been set wider situation in which the bank
may disclose customer information. It seems an exception to the rule was extended by secret
AMLATPUA (Aspalella A. Rahman, 2014). At first glance, it may seem as if the task has
been made does not mean that the confidentiality and customer information may be disclosed
as if for it. However, AMLATPUA actually been set wider situation in which the bank may
disclose customer information compared with BAFIA,

Referring to parts III and IV AMLATPUA, the disclosure of the information needed to be
shared between the authority (ies) who are competent and regulated institutions. However,
this authority (ies) competent and regulated institutions shall comply with the reporting
requirements as specified under AMLATPUA it. Banking secrecy is considered one of the
biggest obstacles to sharing information between the competent authorities. With the
introduction AMLATPUA our law, this problem has been dealt with and under control.

According to Section 9 AMLATPUA, the competent authorities of Malaysia, the Financial

Intelligence Unit (FIU) in the Central Bank may authorize the release of information to law
enforcement agencies or officials, Labuan Offshore Financial Services Authority and the
Attorney General to deal with any foreign country to apply for mutual assistance and sharing
information in the investigation of money laundering

Referring to Section 10 (1) AMLATPUA, barring any suspicious transactions with foreign
powers, the FIU allowed to share that information with a foreign power is provided to be an
arrangement between Malaysia and overseas conditions. In this regard, the FIU shall ensure
that the relevant authorities need to "perform" for maintaining the confidentiality of the
information submitted and communicated to them and will not use such information as
evidence in any court proceedings. Of this section, it shows that AMLATPUA predetermined
rigid constraints everywhere sharing information to prevent the misuse of information. In
addition, officials have access to information from the FIU did not disclose the information,

Next, if there are proceedings of money laundering or terrorist financing offenses and / or
offenses as listed in the Second Schedule or similar crimes in a foreign jurisdiction,
AMLATPUA allow disclosure of information by virtue of Section 12 AMLATPUA.

However, the confidentiality of information disclosed should not have abuse other than those
authorized by this Part or otherwise sentenced to a fine not exceeding three million ringgit or
to imprisonment for a term not exceeding five years or both.

Any investigation of money laundering and financing of terrorism offenses, AMLATPUA

have to authorize the FIU and the relevant enforcement agency in coordinating and cooperate
with any law enforcement agencies within and outside the state.

In other words, the main goal is to balance the needs and AMLATPUA information sharing
with authorities authorized and at the same time maintaining and preserving client
confidentiality for combating money laundering and terrorist financing.

Implementing provisions relating to international cooperation under AMLATPUA,

AMLATPUA should be read conjunctively with the relevant provisions under the 2002 Act
of Mutual assistance in criminal matters (MACMA). MACMA have more impact area, it will
give permission to Malaysia to seek and provide assistance in the investigation and
prosecution of criminal offenses and in forfeiture and confiscation of proceeds of
crime. Assistance will be provided based on bilateral agreements and multilateral cooperation
between Malaysia and foreign countries. Any request made by a foreign government to each
other in a criminal matter that does not have legal assistance treaty Malaysia,
On the request made by a foreign country by virtue of section 23 (3) MACMA, lawyers may
apply to the court for an order to produce evidence within seven days from the date of the
order or such other period as the Court may deem appropriate.

Confidentiality of information is constantly updating content and enforced under Section 24

(4) (b) which provides that an order to obtain assistance in criminal investigations from the
State foreign shall have effect Notwithstanding any obligation as to secrecy or other
restriction on disclosure of information. However, there are some exceptions to these
restrictions on where people obey such an order will not be considered in breach of any
restriction on disclosure of information imposed by statute, contract or rules of professional
conduct. It is clear that this provision has replaced the rule of confidentiality to allow for
international cooperation and assistance in the process of criminal investigation.

AMLATPUA also override banking secrecy in government by requiring banks to comply

with the reporting obligations under Part IV of the Act. It is stated in Section 16
AMLATPUA requiring banks to get the true identity of customers before establishing any
relationship banking. This information needs to be verified and stored safely through Section
15 (2) MACMA. Furthermore, the Bank will be bound by the legal obligations imposed by
AMLATPUA where customers can disclose confidential information to the relevant
authorities if there is suspicion of money laundering or terrorist financing activities
[1]. Section 22 (4) AMLATPUA information to be included in the report will consist of
information about the individual conducting the transaction,

The people involved can be punished by a fine not exceeding RM100,000 or imprisonment
not exceeding 6 months or both.Reporting obligations under AMLATPUA shows that the
Bank has to manage a balance between compliance with the law and reasonable protection of
customer confidentiality. However, it seems that the report takes precedence over client
confidentiality.

It is set out under section 20 of AMLATPUA that "[it] provisions of this Part shall come into
force Notwithstanding any obligation as to secrecy or other restriction on disclosure of
information imposed by any written law or otherwise". This section clarifies that banking
secrecy will not be raised as a ground does not comply with the report or request for
information. Therefore, it is important to know that the bank and the employer will not be
subject to banking secrecy in the regulations under BAFIA or common law when they will
comply with the reporting obligations AMLATPUA. In addition, pursuant to Section 24 (1)
AMLATPUA, someone lodges report suspicious protected from any civil, criminal or
disciplinary. Under Section 24 (1) (b) states that AMLATPUA protected person of any
consequence which follows from the report. Section 77 (c) of AMLATPUA provides that no
proceedings may be brought against any person lawfully acting in accordance with any
instructions, instruction or order of the Director or officer of the competent authority or the
relevant enforcement agency.

However, Section 79 AMLATPUA once again emphasize that client confidentiality should
be maintained at any other time, except when required by law as follows: -

Except for the purpose of carrying out duties or functions under this Act or when lawfully
required to do so by any court or under the provisions of any written law, no person shall
disclose any information or matter which has been obtained by him in th e performance of his
duties or the exercise of its functions under this Act.

No person who has any information or matter which has been submitted in contravention of
subsection (1) his knowledge shall disclose the information or matter to any other person.

Any person who contravenes subsection (1) or (2) commits an offense and shall be liable on
conviction to a fine not exceeding one million ringgit or to imprisonment for a term not
exceeding one year or both.

Therefore, this section clearly shows that banking secrecy is still intact, and it still continues
to protect the cardinal principle of banking secrecy rules except where detect and prevent
money laundering overcome a whole must protect customer information. Criminal liability
will be imposed on persons found to have violated the terms as stated by AMLATPUA.
WEEK EIGHT - ANTI-MONEY LAUNDERING LAW

What is money laundering? Discuss

Money laundering is a process of converting cash or property derived from criminal activities
to give it a legitimate appearance. It is a process to clean dirty money in order to disguise its
criminal origin.

According to Section 4 of AMLATFA provides that any person who:

is involved in a transaction dealing with proceeds of an unlawful activity;

deals with the proceeds of an unlawful activity;
removes from or brings into Malaysia proceeds of an unlawful activity; or
does anything to misrepresent the nature of the proceeds of an unlawful activity,
commits a money laundering offence.

WEEK NINE- BANKING SECURITIES AND GUARANTEE

Securities are usually taken at the outset before the loans or any other credit facilities
granted by banks to their customers. Why securities are important for the banks and
financial institutions? Give your opinion on this.

The securities are important for the banks and financial institutions because bank can ensure
the loan repay with the charge the of interest. the bank are easily marketable and convertible
into cash at short period which are liquidity .Bank can earn sufficient profit
Discuss the liabilities of a guarantor

Guarantor is the person who will liable to help others to pay debt if the guarantee fail to pay.
More often than not, guarantors willingly sign the contract of guarantee without fully
realising the impact it may have in the future. So it is very important that guarantor must
know the content of the contract and understand before sign the contract. There are some
liabilities of guarantor :

The extent of the liability of a guarantor will be as specified in the guarantee document.

A guarantor may be held liable for the liabilities of the borrower in accordance with the
terms of the guarantee document.

A guarantor can only be rendered liable under a guarantee if the borrower is default of any
payment to the financial institution and the financial institution makes a demand on the
guarantor.