The Financial Action Task Force and Asia/Pacific Group on Money Laundering say Malaysia recovered RM37.63 billion in assets.
FATF and Asia/Pacific Group on Money Laundering (APG) said in a report published today that Malaysia recovered a total of 8.11 billion euros (RM37.63 billion) in assets between 2019 and February 2025, with 75% linked to the 1MDB scandal.
Most of these were repatriated through foreign civil forfeiture actions and settlements, the 275-page Mutual Evaluation Report (MER) noted.
The FATF-APG evaluation assessed Malaysia’s anti-money laundering, countering financing of terrorism and countering proliferation financing (AML/CFT/CPF) measures, and its level of compliance with international FATF standards, during an on-site visit by an international team of assessors in February.
The report also said the increase in money laundering investigations to 2,648 cases, more than three times the 821 cases reported in Malaysia’s 2015 MER, is a positive development.
Of these, 880 involved fraud, 781 drug trafficking, 433 corruption, 136 smuggling, 101 organised crime while 317 were other offences.
However, between 2019 and February this year, Malaysia recorded 234 prosecutions and secured only 52 convictions, despite a high number of investigations.
“This reflects serious shortcomings in translating investigations into outcomes,” the report said.
“Issues such as evidence collection challenges, legislated time limits to investigate, lack of training and experience for prosecutors, and a preference for compounds and tax-based asset recovery continue to limit the effectiveness of criminal enforcement.”
According to the report, Malaysia acknowledged that its efforts in relation to 1MDB asset recovery had diverted resources away from other cases, given their importance and transnational complexity.
Key recommendations include expanding capacity to investigate money laundering linked to medium and high-risk predicate offences, improving prosecutorial approaches, and enhancing training for investigators, prosecutors and judges on money laundering typologies.
“Training should also be provided to LEAs and prosecutors on the money laundering risks related to Malaysia’s risk profile, including its medium-high risks for money laundering, namely tax crimes, forgery, human trafficking/migrant smuggling, sexual exploitation and environmental crime.”
It said Malaysia should improve its ability to target higher-level transnational organised crime groups and international money laundering facilitators, especially those involved in stand-alone or third-party money laundering.
Additionally, Malaysia should develop the ability to investigate third-party money laundering and trade-based money laundering, thereby improving its capability to detect and investigate specific money laundering typologies, the report added. - FMT
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