Elite deviance, deferred accountability and institutional legitimacy

A criminologist examines Malaysia’s high-profile financial crime investigations.

From P Sundramoorthy

From a criminological standpoint, recent high-profile investigations into large-scale financial crimes in Malaysia, including the MBI Ponzi scandal, major scrap iron smuggling syndicates, and alleged corporate money laundering involving billions of ringgit, reveal more than isolated instances of economic crime.

They expose enduring structural tensions between power, privilege and accountability within the criminal justice system.

While enforcement agencies have demonstrated operational capability through arrests, seizures and investigations, the prolonged absence of clarity regarding the suspects’ identities, prosecutorial decisions, and case outcomes raises serious concerns about institutional legitimacy and the management of elite deviance.

Criminology has long recognised that financial and corporate crimes differ fundamentally from street crime, not only in scale and impact, but in how offenders are treated by the justice system.

The concept of elite deviance highlights how individuals with social status, political influence or economic power often experience delayed, negotiated or obscured accountability.

The current silence surrounding suspects, particularly those reported to hold honorific titles, fits this pattern uncomfortably well.

While non-disclosure may be justified on procedural grounds, the selective invisibility of elite suspects creates the perception that status operates as a protective buffer against exposure.

The question of why suspects are not publicly identified must therefore be examined through the lens of procedural justice.

Public confidence in law enforcement depends not only on outcomes, but on the fairness, transparency and consistency of processes. When ordinary offenders are swiftly named, charged and prosecuted, while powerful suspects remain unnamed despite massive public harm, the system appears asymmetrical.

From a criminological perspective, such asymmetry weakens normative compliance, and citizens’ willingness to obey the law because they believe it is applied fairly.

Equally troubling is the issue of delayed or absent charges.

While complex financial crimes require extensive investigation, prolonged pre-charge limbo can amount to what criminologists describe as deferred accountability. This creates a dangerous gap between harm and consequence. In cases involving billions of ringgit and millions of victims, delays are not merely administrative, they shape social narratives about impunity.

Deterrence theory emphasises that punishment must be certain, not merely severe. When certainty collapses, the deterrent effect diminishes, particularly among economically motivated offenders who calculate risk rationally.

Speculation that some of these cases may involve deferred prosecution agreements (DPAs) raises further criminological concerns. In jurisdictions where DPAs are formalised, they are controversial precisely because they risk transforming criminal accountability into a negotiated managerial exercise.

From a criminological viewpoint, DPAs sit uneasily between punishment and regulation.

Without transparency, judicial oversight and clear statutory grounding, they risk reinforcing the perception that elite offenders can bargain their way out of criminal stigma.

In Malaysia’s context, where no explicit DPA framework exists, informal or opaque resolutions are especially problematic.

This leads directly to the issue of legal clarity and institutional design. Criminology stresses that ambiguity in enforcement mechanisms breeds inconsistency.

If DPAs or quasi-DPA arrangements are being utilised under prosecutorial discretion, the absence of a statutory framework means there are no uniform standards governing duration, disclosure, sanctions or monitoring.

This creates fertile ground for perceptions of arbitrariness and preferential treatment, classic conditions under which trust in criminal justice institutions deteriorates.

Another critical criminological dimension concerns reputational harm and the presumption of innocence.

When enforcement actions are publicised but outcomes remain unresolved, suspects occupy a liminal space between guilt and innocence.

Labelling theory warns that prolonged association with criminal investigations without resolution can function as a form of social punishment. From this perspective, law enforcement agencies have a duty not only to prosecute the guilty, but to publicly exonerate those against whom no action will be taken. Silence is not neutral; it actively shapes social judgment.

The most consequential issue, however, lies in the future risk posed by unresolved elite offending. Criminology identifies this as a problem of moral hazard.

If individuals or corporations involved in massive financial crimes are perceived to avoid prosecution through delay, negotiation or silence, it sends a powerful signal that economic crime is low-risk for those with sufficient resources. This undermines general deterrence and encourages recidivism, particularly in sectors involving high-value transactions, public trust, or regulatory complexity.

In jurisdictions with structured responses to corporate crime, DPAs where they exist are accompanied by stringent conditions: admissions of wrongdoing, independent compliance monitors, restrictions on future business activities, and severe financial penalties.

From a criminological standpoint, these measures are essential to prevent neutralisation techniques, where offenders rationalise misconduct as acceptable or inconsequential. Without such safeguards, negotiated outcomes risk becoming symbolic gestures rather than mechanisms of behavioural change.

Ultimately, the unresolved questions surrounding these cases contribute to what criminologists describe as a legitimacy deficit.

Legitimacy is not maintained through enforcement power alone, but through public belief that institutions act impartially and decisively. When enforcement appears selective, delayed or opaque, particularly in cases involving elite actors, public cooperation declines, cynicism increases, and informal norms begin to tolerate corruption and financial crime.

In conclusion, viewed through a criminological lens, these cases are not merely about legal procedure or prosecutorial discretion. They reflect deeper challenges in managing elite deviance, maintaining deterrence, and preserving institutional legitimacy.

Addressing these challenges requires more than successful seizures or investigations. It demands transparent communication, consistent application of law regardless of status, and if alternative prosecution mechanisms are to be used, a clear legal and policy framework grounded in accountability and transparency.

Without this, the criminal justice system risks reinforcing precisely the behaviours it seeks to deter. - FMT

P Sundramoorthy is a criminologist at the Centre for Policy Research, Universiti Sains Malaysia, and an FMT reader.

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.