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Malaysia central bank announces new measures to combat financial scams

Measures include more secure forms of user authentication and a cooling-off period for first-time online registrations.

Malaysia central bank announces new measures to combat financial scams

File photo of Malaysia's Central Bank (Bank Negara Malaysia) in Kuala Lumpur. (Photo: Bernama)

KUALA LUMPUR: Malaysia’s central bank has announced a slew of additional measures and security features to curb the rising number of financial scams. 

In a speech at a financial crime exhibition on Monday (Sep 26), Bank Negara Malaysia (BNM) governor Nor Shamsiah Mohd said that the measures include requiring banks to migrate from SMS one-time passwords to “more secure forms of authentication” for online activities and transactions as well as “a cool-off period” for first-time online banking service registrations. 

“The tighter security controls are being put in place to deter efforts by criminals to scam consumers,” said Mdm Nor Shamsiah. 

Additionally, she outlined that banks will be required to further tighten fraud detection features by immediately alerting customers when fraudulent activity is detected in their accounts and to block such transactions. 

Users will also be restricted to one mobile device for authentication and banks will be required to set up dedicated hotlines for customers to report financial scam incidents. 

In announcing these measures, Mdm Nor Shamsiah acknowledged that they would inevitably lead to friction or inconvenience for customers' online banking experience. Yet she stressed that they were necessary. 

“For example, online banking transactions might take a little longer to process. Financial institutions will also conduct more checks when customers request to change or register a new phone number,” said Mdm Nor Shamsiah.

“Make no mistake, while these measures entail some inconvenience, they are important to protect the interests of customers,” she added. 

The governor added that BNM will continue to inform the public on the latest scams-related information through a new dedicated Facebook page, Amaran Penipuan (Scam Warnings). 

Speaking at the same event, Inspector-General of Police Acryl Sani Abdullah Sani said online scam cases in Malaysia were on an upward trend. 

He explained that these cases involved online sales scams, online trading scams, African scams, Macau scams, business email compromise scams, fake loans and SMS scams.

He noted that in 2019, a total of 13,703 of these scam cases were reported, involving losses of RM539 million (US$117 million). However, in 2020, there were 17,227 cases with RM511.2 million in losses recorded.

Mr Acryl Sani added that in 2021, the figures have increased, with 20,701 scam cases and losses amounting to RM560.8 million.

He noted that between January and July 2022, there were more than 12,000 scam cases reported with losses amounting to more than RM400 million. 

Meanwhile, other than financial scams, there have also been reports of Malaysians falling for overseas job scams lately. 

Duped by lucrative job offers in countries like Cambodia and Thailand, they were whisked illegally into the country, stripped of their travel documents and forced to scam others.

As of last Monday, Wisma Putra said 143 Malaysian victims had been rescued from Cambodia, 16 from Thailand, 27 from Laos and five from Myanmar. 

Source: CNA/am(tx)
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