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Enforcement Action against Company Conducting Illegal Deposit Taking

Release Date: 29 Nov 2017

A joint raiding operation was conducted on Koperasi Dinar Dirham Berhad on 28 November 2017 led by Bank Negara Malaysia together with the National Revenue Recovery Enforcement Team of the Attorney-General’s Chamber (NRRET), Royal Malaysian Police (RMP), Malaysia Co-Operative Societies Commission (SKM) and Cyber Security Malaysia (CSM). Koperasi Dinar Dirham Berhad was suspected to have committed an offence under the Financial Services Act 2013 (FSA) and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA). The joint raiding operation is one of the continuous inter-agencies measures to eradicate illegal financial scheme activities.

Nine premises related to Koperasi Dinar Dirham Berhad located in Kuala Lumpur and Selangor and its related affiliates were raided, where relevant documents were seized to assist in investigation. Six company directors suspected to act as mastermind and agents for illegal deposit taking activities were arrested and remanded for two days to assist investigation. The joint raiding operation also resulted in the seizure of 8 vehicles valued more than RM1.5million and freezing of 114 bank accounts in 12 banks amounting to RM15.3 million under the AMLA. A sum of Ringgit and foreign currencies totalling RM1.4 million, as well as 22.5 kg precious metals were seized.

The authorities are also working in collaboration with Brunei Financial Intelligence Unit in investigating the Company’s operation in Brunei for similar offence.

Under section 137(1) of the FSA, it is an offence for any person to accept deposits without a licence. Investigations for money laundering offence will also be undertaken under the AMLA, where if convicted can subject such person to a fine of not less than five times the sum or value of the proceeds of unlawful activities at the time the offence was committed or RM5 million, whichever is higher, and imprisonment not exceeding 15 years.

Members of the public are advised not to deal with illegal deposit taking company for purpose of investment and should refer to licensed financial institutions which are listed on Bank Negara Malaysia’s website (www.bnm.gov.my) for further information.

© Bank Negara Malaysia, 2017. All rights reserved.