Bills to combat online financial fraud tabled in Parliament

Bills to combat online financial fraud tabled in Parliament

KUALA LUMPUR: Amendments to the Penal Code and Criminal Procedure Code aimed at combating online financial fraud and mule accounts were tabled in the Dewan Rakyat on Tuesday (July 9).

The Penal Code Amendment Bill 2024 and the Criminal Procedure Code Amendment Bill 2024 were tabled for first reading by Minister in the Prime Minister’s Department (Law and Institutional Reforms) Datuk Seri Azalina Othman Said.

The Penal Code Amendment Bill, 2024 seeks to provide for offences related to payment instruments or accounts in financial institutions, in order to address the alarming rise in online financial fraud.

The proposed amendment to the Penal Code (Act 574) would also include new sections 424A, 424B, 424c and 424D.

“The proposed new section 424A seeks to provide for the offence and penalty for possessing or controlling any payment instrument of another person or any account of another person in a financial institution without lawful authority or for a lawful purpose,” the bill reads.

This offence is punishable by a fine of RM5,000 to RM50,000, imprisonment of six months to five years, or both.

Bill 424B sets out the offence and penalty for allowing another person to control or possess payment instruments or an account in a financial institution without authority or legitimate purpose.

Violations of this provision are punishable by a fine of between RM10,000 and RM100,000. They are also liable to imprisonment for a term of not less than one year and not more than seven years, or both.

Under section 424c(1), persons who directly or indirectly carry out transactions using their payment instruments or accounts for unlawful purposes may be punished with imprisonment of three to ten years or a fine of between RM10,000 and RM150,000, or both.

In respect of illegal transactions made using another person’s payment instruments or account, under section 424c(1), a fine of between RM10,000 and RM150,000 or imprisonment of three to ten years, or both, may be imposed.

Financial institutions herein refer to banks licensed under the Financial Services Act, 2013 (Act 758), Islamic banks licensed under the Islamic Financial Services Act, 2013 (Act 759) and institutions prescribed under the Development Financial Institutions Act, 2002.

Payment instruments mean those designated by Law 758 and Law 759.

Regarding the amendments to the Code of Criminal Procedure, a new article 116D has been proposed.

This proposed amendment empowers a police officer of at least the rank of sergeant to seize or prohibit any transaction involving money held or suspected of being held in a payment instrument or account at a financial institution.

The police officer may act if he or she has reasonable grounds to suspect that an offence has been committed, if the money has been used or is intended to be used to commit an offence or if the money constitutes evidence of an offence.

The second reading is scheduled for the current Dewan Rakyat meeting.