Bank Negara goes tough on addressing online scams

SHAH ALAM - Bank Negara (BNM) will join hands with the cops and financial institutions to identify fraud and scammers in the country, as scammers look for the latest ways to cheat.

This comes after the police had recently said they are unable to act quickly on a case due to bureaucracy practiced by banks.

The central bank has further issued guidelines for financial institutions to carry out due diligence work when opening bank accounts and to carry out checks on existing bank accounts.

A Bank Negara official who spoke on the condition of anonymity said the guidelines cover measures to effectively profile customer risk and identify the existence of financial fraud using several ‘red flag’ indicators.

A circular has been issued to financial institutions to improve the effectiveness of existing processes including effective communication channel between financial institutions and victims to take necessary steps, including contacting the cops to assist in a probe.

“Customers of financial institutions also need to be assured that detailed investigations and redemption processes will be carried out fairly within a reasonable period of time.

"In addition, financial institutions are also urged to implement additional measures to protect victims of financial fraud from further losses such as temporarily suspending online banking services and ensuring the victims' mobile devices are free of 'malware' attacks with the consent of customers," he said.

The circular letter also called for effective cooperation within financial institutions and law enforcement agencies to carry out thorough internal investigations, including imposing temporary restrictions based on the terms and conditions of the account to carry out comprehensive assessment while ensuring that money is not withdrawn by scammers from the account.

In the meantime, BNM also provides a channel for the public to lodge complaints with the Ombudsman for Financial Services if there is a dispute over the results of the financial institution's investigation, including loss of money from their accounts due to unauthorised transactions.

Selangor Police Chief Datuk Arjunaidi Mohamed in April had said that the police faced constraints to act quickly to deal with such crime due to the bureaucracy practiced by banks.