KUALA LUMPUR: As long as there is due diligence, any Malaysian can open bank accounts outside the country if they are keen to do so, Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz told the Dewan Rakyat today.
He said this in light of yesterday's Pandora Papers bombshell which linked Tengku Zafrul to offshore dealings.
As it is, Tengku Zafrul said, the country's financial sector is being regulated by Bank Negara Malaysia (BNM) through the Financial Services Act 2013 and Islamic Financial Services Act 2013.
For offshore activities, he explained that it is regulated by the Labuan Financial Services Authority (Labuan FSA) through the Labuan Financial Services and Securities Act 2010 & Regulations as well as Labuan Islamic Financial Services and Securities Act 2010.
"They have to also pass the existing customer due diligence processes as stated within the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.
"The ministry would like to clarify that anyone can open an account with any licensed banks including offshore accounts, but they must get the approval of the regulatory bodies involved and pass the due diligence processes.
"This is stated under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001," he said in the Lower House.
Tengku Zafrul was responding to a question by his predecessor Lim Guan Eng (PH-Bagan) who asked on the government's plan to bring back money from offshore accounts owned by Malaysians as exposed in the Pandora Papers.
Commenting on the Papers, Tengku Zafrul said the leaks showed the weaknesses of certain countries in their financial regulations while assuring that Malaysia is free from such weak laws.
"The investigation by the International Consortium of Investigative Journalists (ICIJ) involved leaked documents of 14 offshore service providers, which offer professional services to individuals or companies to establish shell companies, trusts or foundations to open these accounts at countries that have weaknesses in their financial laws. But, we are not one of those countries that have such weaknesses."
The so-called "Pandora Papers" investigation – involving some 600 journalists from various media including The Washington Post, the BBC, and The Guardian – is based on the leaks of some 11.9 million documents from 14 financial services companies around the world.
Some 35 current and former leaders are featured in the latest vast trove of documents analysed by the ICIJ – facing allegations ranging from corruption to money laundering and global tax avoidance.
The expose also linked a number of other prominent Malaysians to offshore dealings.
According to Malaysiakini, which was provided with the information by ICIJ, Tengku Zafrul's name appeared as the director of Capital Investment Bank (Labuan) Ltd, a boutique bank incorporated in the offshore jurisdiction of Labuan.
Yesterday, he said he had relinquished his executive and directorship roles in the Kenanga Group by June 2010.