Director ARI HICoE: Research in AML/CFT

Saturday, April 16, 2011

Research in AML/CFT

The following write ups were excerpts from the Accountants Today (August 2008)- a professional journal of the Malaysian Institute of Accountants (MIA). It is an important reminder for all accounting professionals.

Following the September 11 tragedy in the USA in 2001, a new law known as the Anti Money Laundering and Anti Terrorism Financing Act (AMLATFA 2001) was introduced in Malaysia. The Financial Action Task Force (FATF)research highlighted a trend in the use of complex commercial arrangements by money launderers and terrorism financiers to hide their money trail. These arrangements often use the services of professionals such as lawyers, accountants and company secretaries. Arising from this trend, the FATF standards require countries to improve their Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT)on Designated Non-Financial Businesses and Professions (DNFBPs) Sector.

In Malaysia, the DNFBPs include casinos,real estate agents, dealers in precious metals and stones, lawyers, companies secretaries, accountants and other independent legal professions. All have been made reporting institutions. Reporting institutions shall report to the Financial Intelligent Unit (FIU) in Bank Negara, any transactions where the identity of the persons involved, the transaction itself or any other circumstances concerning that transactions give any officer or employee of that reporting institutions, reasons to suspect that the transactions involve proceeds of an unlawful activity. Research in this are is still limited and ARI is in the best position to lead research in this AML/CFT sector....

Welcome

The creation of this blog is an effort to provide latest update and information about ARI. As a director to ARI, I want to share my personal vision and perhaps invite those who visit this blog to give ideas and constructive comments on how to continuously improve ARI from time to time. ARI is a centre of excellence under the Ministry of Higher Education, Malaysia. Personally, I believe that it can go very far. Plans are underway for ARI to participate at international platforms.

As a Higher Institutions' Centre of Excellence (HICoE), ARI is to drive a niche research in Islamic Financial Criminology (IFC). Essentially there are two main research thrusts within IFC: (i) Islamic Accounting & Muamalat and (ii) Financial Criminology. The focus on IFC is in tandem with the government's aspiration of making Malaysia, the global hub is Islamic Finance. In view of this vision, fundamental research in financial criminology is important so that new policies or system can be developed to mitigate and prevent financial crime within the Islamic Finance industry and other economic sectors.

ARI's research in Islamic Financial Criminology is divided into three phases. In Phase One, IFC research projects will focus on both local and regional issues. As such, ARI will forge a lot smart research collaborations with other research centres, professional bodies, government agencies, regulatory & enforcement agencies, universities and the private sectors. The Phase One projects aim to identify specific IFC issues that necessitate the development of new poducts, models, framework or policies. ARI will collaborate with agencies such as JAKIM, IKIM, IBFIM, INCEIF, ISRA, PDRM, RMC, FIU, BNM, MACC, IIM, UIA, USIM, USM etc. In term of deliverables, at least fifty publications will be produced by Phase One initiatives.

Premised on specific issues identified in Phase One projects, Phase Two focuses on working on specific IFC products, models, framework and/or policies related to IFC. ARI invites international partners who are experts in their own fields to participate in Phase Two research projects. Several international players from Australia, USA, UK, New Zealand, Japan, Taiwan, Korea and Singapore have indicated their interest to participate.

In Phase Three, IFC products, models, policies are further enhanced. The main aim of Phase Three is to isolate elements of technology transfer and the development of systems into IFC products, models, framework or policies. Upon completion of Phase Three, IFC products will be launched and ARI hopes to become a leading research centre globally focusing on its niche "Islamic Financial Criminology".

Director ARI HICoE

Saturday, April 16, 2011

Research in AML/CFT

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