Malaysia Finance Minister Tengku Zafrul : Malaysians Are Allowed To Open Offshore Accounts

Individuals are allowed to open accounts with any licensed banks, including offshore accounts, under the purview of Bank Negara, says Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz.

However, he said those who want to open offshore accounts must go through the due diligence process under the Anti-Money Laundering, Terrorism Financing and Proceeds of Unlawful Activities (Amla) Act and the related legislation.

He said the so-called Pandora Papers investigation by the International Consortium of Investigative Journalists (ICIJ) was based on a leak of the confidential records of 14 offshore service providers.

He said these providers gave professional services to individuals or companies in setting up shell companies, foundations or other entities and involved countries that have weaknesses in financial services law.

“However, Malaysia is not one of the countries with such weaknesses,” he said in reply to a supplementary question from Bagan MP Lim Guan Eng in the Dewan Rakyat yesterday.

Lim had asked about the government’s efforts to retrieve money deposited in offshore accounts following the Pandora Papers leak.

The ICIJ reportedly obtained the trove of more than 11.9 million confidential files and led a team of more than 600 journalists from 150 news outlets that spent two years sifting through them, tracking down hard-to-find sources and digging into court records and other public documents from dozens of countries.

The expose had also linked a number of prominent Malaysians to offshore dealings.

Tengku Zafrul pointed out that the financial sector in Malaysia was regulated under the purview of Bank Negara under the Financial Services Act 2013 and Islamic Financial Services.

“Offshore activities are regulated by the Labuan Financial Services Authority (LSA) under the Labuan Security and Financial Services 2010 Act and Labuan Islamic Security and Financial Services 2010 Act,” he said.

To the initial question on the budget deficit, Tengku Zafrul said that based on the 2021 Budget, the deficit was expected to be at 5.4%.

“However, the government had taken expansionary fiscal policy in dealing with the Covid-19 pandemic, so the deficit is currently expected to be around 6.5% to 7%,” he added.

As of Sept 15, an estimated RM216bil or more than 66% had been spent as planned under the allocation of RM322.5bil under the 2021 Budget.

Aside from that, he said the government had also announced eight stimulus packages totalling an estimated RM530bil inclusive of fiscal and non-fiscal measures.

Tengku Zafrul said as of Sept 24, more than RM330bil or 62% had been used which benefitted 20 million people and 2.4 million businesses.

“To help support the fiscal injection, the spending under the Kumpulan Wang Covid-19 (KWC) fund has reached RM60bil or 90% of the fund.

Taking into account the additional needs, the government will also propose to increase the debt limit for KWC to RM110bil from RM65bil, to support the spending for this year and other future needs,” he said, adding that the government had allocated RM33bil of direct cash aid to the people while another RM30bil was allocated to businesses,” he said. especially small and medium entrepreneurs.



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