Donald Lim: Measures taken to stem RM150bil lost

Deputy Finance Minister Donald Lim said that the RM150 billion said to have flowed illicitly out of Malaysia in 2009 is "not a new issue" and measures are already being taken to plug the leak.

Speaking to Malaysiakini, Lim said that the government is aware of the staggering figure revealed by Washington-based financial think-tank Global Finance Integrity, making Malaysia’s illicit capital flightone of the highest in the world.

"So far, there is no new issue revealed. It has been brought up by GFI and we have made announcements in Parliament as to the measures undertaken," he said in a telephone interview.

Lim's statement echoes police chief Ismail Omar, who on Friday put the blame on money laundering activities and said that action is being taken to freeze the assets of those involved in such organised crime.

Asked if the GFI estimate of RM150 billion is close to Bank Negara Malaysia estimates, Lim said that the amount "may not be the actual figure".

"Nobody can ascertain the figure, we don't know it unless we are given a breakdown. As I understand it, GFI has been in touch with Bank Negara about this," he said.

He added that while the financial authorities will "keep monitoring the situation", this is a hazard which Malaysia will continue to face being an open economy.

"Malaysia's trade in 2010 was RM1.2 trillion and we expect a 7 percent growth this year," he said.

'Bank Negara doing a good job'

The minister added that Bank Negara has "done a good job so far" in addressing the problem, including introducing more stringent regulations for money changers.

The RM150 billion lost in 2009 was revealed in an update to GFI January's groundbreaking report, where the think-tank reported that Malaysia had lost up to RM889 billion in illicit outflows from 2000 to 2008.

Responding to this in Parliament, Finance Minister Najib Abdul Razak said Bank Negara has carried out investigations on illegal transfers, particularly through money changers.

"An action plan and new framework of laws for the money changing and remittances industry will be implemented this year to bring about solid growth and development for the industry with good administrative standard and professionalism that will protect the integrity of the industry," he had said.

Saying this to a written answer to Lim Kit Siang (DAP-Ipoh Timor) in March, Najib added that Malaysian authorities are also increasingly working with foreign enforcement agencies to probe suspect cross-border transactions.

Najib, who is also prime minister, however said that the actual figure lost is RM153 billion - not RM889 billion as estimated by GFI - but this was questioned by experts.