Empower Anti Graft Drive With Law On Unexplained Wealth

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In November 2018, the newly minted finance minister, Lim Guan Eng, announced that the government is considering introducing legislation similar to the UK’s Unexplained Wealth Order (UWO) in Malaysia.
This law compels a person to reveal their sources of unexplained wealth. The authorities will seize the assets of those who fail to account for their wealth when compelled to do so by the court-issued order.
During a question-and-answer session at a special briefing on Budget 2019 in Penang, Lim said that Malaysia’s attorney-general is studying this legislation, which allows the government to seize extraordinary and unexplained assets owned by prominent individuals, especially politicians.
More than six years have passed, three governments have changed, and there’s little indication that it will ever be debated in Parliament.
Section 36 of the MACC Act empowers the MACC to obtain information about any property held or acquired by an individual.
Still, the power is limited in its reach as it has to be in connection with an offence provided for under the MACC Act.
It does not make possessing unusual or unexplained wealth an offence, which severely restricts the MACC’s power to investigate matters related to corruption comprehensively.
‘Offence’
In an appeal to Prime Minister Anwar Ibrahim in 2023, I wrote: “Many countries have laws pertaining to unlawful or unexplained wealth. Some have a provision that it is an ‘offence’ to have assets or lead a lifestyle that is disproportionate to the declared income.
“Others, like the United Kingdom, introduced a regulation called the Unexplained Wealth Order (UWO) in January 2018.”
The UWOs require the owner of an asset worth more than £50,000 (RM274,063) to explain, among other things, how he or she was able to afford it.
This law will add firepower to the MACC and Anwar’s “I don't care who you are” chant last week.
“I don’t care how big or powerful you are, I will not allow it because it will undermine, betray, and weaken our national defence system.
“I will not tolerate it. I will do everything in my power to put an end to it,” he said.
Legal shortcut
It will be argued that the MACC Act 2009 and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 contain provisions for recovering corrupt assets in Malaysia.
However, consider the UWO as a legal shortcut to accelerate the process of recovering corrupt assets with a court order requiring a person to provide details of the origin of specific assets. The assets could be recovered through the subsequent civil forfeiture proceedings.
UWOs shift the burden of proof away from prosecutors and onto the asset’s owner and give the powers to seize the assets and prosecute.
Despite the Madani government overemphasising the need to end corrupt practices, not a week goes by without the media reporting on one scandal or another involving misuse of power, money, or corruption.
In a previous article on 1MDB in 2018, I wrote: “This is the weapon that the Malaysian government needs to seize and repatriate millions of ‘dirty money’ that had been laundered through property purchases in the UK and the purchase of expensive jewellery and paintings.
“It’s said that if you threw a stone in London’s Bayswater area, it would probably land on the head of a Malaysian Datuk who owns a property in the much-sought-after neighbourhood! On a more serious note, this legislation would be the most powerful weapon to identify the properties and valuables purchased in Malaysia with money stolen from 1MDB.”
The UWO applies not only to monies stolen from 1MDB but also to government funds misappropriated by government officials, businesspersons, and politicians using proxies and nominees.
Accounting for wealth
What was then a few ringgit, just as duit kopi (coffee money), has subsequently become a culture in which any transaction with the government needed a few hundred or a few thousand to grease the palms of civil servants.
Now, it seems that it is an entitlement that runs into the millions—as we have heard from evidence presented in several cases in a court of law.
We see pictures of people in orange uniforms handcuffed and taken to the court every week. Among them have been former ministers, high-level businesspersons, and senior civil servants.
How many of these in orange who are paraded, eventually prosecuted?
Often, they are caught with humongous amounts of money, as we have seen in recent days.
What happens if it is argued that “there’s insufficient evidence to prosecute”? The seized money and other assets are returned, and the file will be stamped “NFA” (No Further Action).
With this money, they will continue smoking RM1,000 cigars and celebrating with champagne parties. They can start a new life, acquire a trophy wife, and live happily ever after, as in fairy tales.
With the UWO, they will have to account for their wealth and sources of funds to acquire them. The state can forfeit these assets if it fails to provide information or explanation in a court of law.
But then, does the Madani government have the political will and determination to introduce such legislation?
I can only guess that it fears a backlash from its vote bank, power brokers, and some crooked politicians, some of whom have amassed wealth through dubious means. - Mkini
R NADESWARAN joined the Bar Council and a few like-minded civil society groups and citizens 10 years ago to bring about amendments to the law on ill-gotten wealth.
The views expressed here are those of the author/contributor and do not necessarily represent the views of MMKtT.

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