Authorities can do more to stop Macau scams

REFERRING to the report “30 fall prey to fraudsters every day, say police” (The Star, Sept 24), one must ask why such incidents occur very frequently and involve large amounts of money.

So far, the police have only asked the public to exercise caution to avoid becoming victims. The authorities are not addressing the core of the matter.

I would like the authorities (Bank Negara, Malaysian Communications and Multimedia Commission and police) to address the following points and plug the loopholes in our system that are allowing the Macau scam to continue.

1. Bank Negara’s responsibility is to ensure that our financial institutions comply with the guidelines in the Anti-Money Laundering Act (AMLA). These guidelines mandate financial institutions to continuously monitor each customer’s transaction activity pattern to ensure it is in line with the customer’s pro- file. The guidelines also mandate financial institutions to regularly review existing records of customers especially when a significant transaction occurs. Financial institutions also need to conduct ongoing customer due diligence to examine and clarify the economic background and purpose of any transaction that appears unusual.

The modus operandi of Macau scammers is to use “stolen” bank accounts to get money from the victims. This is usually done in large sums, as highlighted by reports in the media. A key question here is, with the AMLA guidelines in place, how is it possible for banks to hold these “stolen” accounts? Is the security of our banking system so weak that there are lots of stolen accounts floating around which the scammers are taking advantage of? Why didn’t the banks freeze the accounts when unusually large transactions occurred? There is a serious con- cern over how our banks comply with the AMLA guidelines and the silence of Bank Negara in enforcing them.

2. Telecommunication operators are not providing reliable caller ID services and the scammers are taking advantage of this. Scammers change the caller ID to make it appear to the victims that they are calling from, for example, a police station. They then convince the victims to follow their instructions, which includes transferring a large amount of money to the scammers’ stolen account.

The MCMC is turning a blind eye to such incompetence by the telco operators. Where is the quality of service when telco operators provide unreliable caller ID service? What action has the MCMC taken? Telco operators should be held liable for providing unreliable service.

3. The police should widen their investigations instead of just relying on Section 420 of the Penal Code, which deals with cheating and dishonestly inducing delivery of property. There could be other laws that were broken in the execution of the Macau scam, including the AMLA guidelines. Thus, widening the investigation by looking at the Macau scam through other laws would allow the police to find the loopholes and plug them.

It is also the duty of the police to update the victims about the status of their investigations periodically. Some victims would have lost their life savings. Would the police find ways to return the money to them? Can’t an audit trail be done to get back the money? If it is not the duty of the police to get back the stolen money, then who should be doing this? Will the police work with other enforcement agencies to get back the money?