An employee checks US dollar bills inside a money changer in Manila, the Philippines. Money changers in Malaysia are not allowed to remit funds abroad. — Reuters pic
KUALA LUMPUR, Dec 21 — It takes two to tango.
Over the month, it has emerged that Bank Negara Malaysia has come down on the country's ubiquitous money changers in a sweeping probe that has resulted in 41 of them losing their licences.
What was their wrongdoing? Apparently, they'd been sending money overseas on behalf of wealthy Malaysians who did not want the authorities to know that they were in the practice of doing so.
Most Malaysians know that money changers can remit funds — because of their overseas networks and the fact that they are discreet and trustworthy. Some of them are also serious players. It came to light recently that one of the largest players in the business has an annual turnover that exceeded RM3 billion.
Unfortunately for some of them, money changers are not allowed to remit funds abroad. That is the law, pure and simple. Transferring funds abroad can only be done through the proper channels, which means the conventional banking system — with all the requisite paperwork, which means, plainly, no anonymity.
And there are no restrictions on the amount remitted because capital controls were lifted almost five years ago.
What is required is compliance with the regulations, and some paperwork, as the central bank likes to know how much money leaves Malaysia shores. Indeed, Bank Negara has further liberalised Malaysia's exchange control regulations by, among other things, increasing the number of licensed remittance agents in the country.
Last week, opposition lawmaker Tian Chua revealed in Parliament that a mentri besar and two big businessmen had allegedly remitted millions abroad. Meanwhile, the wife of a senior minister allegedly received RM200,000 from a businessman through a money changer while she was on a trip to Dubai.
Chua revealed all their names, much to Parliament's consternation. The result was a deafening silence. Nobody has said anything on the matter. Neither has Bank Negara.
Many years ago, the then Inspector-General of Police attempted to defend the name of his force by asking why the public scrutinised only the police and not the ordinary man on the street who offered money to get off a transgression.
“Everyone looks at us,” he lamented. “Why not look at the giver in the same light?”
From that perspective, it is difficult to fathom the central bank's rationale in not cracking down on those who used the money changers to remit money abroad. What's sauce for the goose must surely be sauce for the gander.
It could be that they did not know that money changers cannot remit monies abroad. But, once again, the law is quite clear.
Prime Minister Datuk Seri Najib Razak's promise of a more transparent, accountable government will come to naught if the public perceives that there are two sets of laws in Malaysia — one for ordinary folks and another for the rich and powerful.
And that would be a tragedy for an administration that appears to be doing all the right things. — Business Times Singapore
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