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Malaysia Toughens Fintech Anti-Money Laundering Regulations
Kuala Lumpur - In a bid to combat illegal financial activities, Malaysia has strengthened its anti-money laundering (AML) regulations for fintech companies.
New Rules Aimed at Preventing Misuse of Digital Currencies and Electronic Money
Under the revised regulations, fintech companies are now required to conduct customer due diligence measures, including:
- Verifying the identity of customers and beneficial owners
- Assessing the purpose and intended nature of business relationships
- Conducting ongoing monitoring of client transactions
Companies must also report any suspicious activity to the Financial Intelligence Unit (FIU) as soon as suspicion arises.
Regulations Apply to All Fintech Companies in Malaysia
The new regulations apply to all fintech companies operating in Malaysia, including:
- Digital currency exchanges
- E-wallet operators
- Other types of electronic money institutions
The Bank Negara Malaysia (BNM) has also issued guidelines for fintech companies on how to conduct customer due diligence and report suspicious activity.
Aimed at Preventing Illegal Activities
According to the BNM, the revised regulations are aimed at preventing the misuse of digital currencies and other forms of electronic money for illegal activities such as:
- Terrorism financing
- Money laundering
The central bank said that it is committed to ensuring that the fintech industry operates in a safe and secure environment.
Industry Response
The new regulations have been welcomed by industry players, who say that they will help to enhance the credibility and integrity of the fintech sector. However, some companies have expressed concerns about the cost and complexity of implementing the new rules.
Effective Date and Compliance Timeline
The new regulations come into effect on January 1, 2020, and fintech companies will have until June 30, 2020, to comply with the new rules.
Commitment to Ensuring a Safe and Secure Environment
In a statement, the BNM said that it is committed to ensuring that the fintech industry operates in a safe and secure environment and that customers are protected from illegal activities such as money laundering and terrorism financing. The central bank said that it will continue to work with industry players to ensure that the sector operates in a way that is consistent with international standards.
Enhancing Credibility and Integrity of Malaysia’s Fintech Sector
The revised regulations are seen as an important step towards enhancing the credibility and integrity of Malaysia’s fintech sector. They demonstrate the country’s commitment to preventing illegal activities such as money laundering and terrorism financing, and to ensuring that its financial system operates in a safe and secure environment.
Growth of Malaysia’s Fintech Industry
Malaysia’s fintech industry has seen significant growth in recent years, with many companies operating in the sector. The industry is expected to continue to grow in the coming years, driven by advancements in technology and changes in consumer behavior.