4-12-2024 (KUALA LUMPUR) A leading Malaysian consumer advocacy group has called for stronger regulations to combat financial scams, urging authorities to establish a clear framework of shared responsibility between banks, telecommunications companies and consumers.
The Federation of Malaysian Consumers Associations (Fomca) has criticised the current “soft approach” to banking oversight, arguing that voluntary guidelines from Bank Negara Malaysia are insufficient to protect consumers from sophisticated financial fraud schemes.
Speaking on behalf of Fomca, Vice-President and Legal Adviser Datuk Indrani Thuraisingham emphasised the need for mandatory regulations rather than optional guidelines. “Banks charge for every minor transaction, yet victims report sluggish responses when reporting scams. The time has come for more robust oversight,” she stated.
The consumer group highlighted Singapore’s stringent regulatory framework as a model for Malaysia to emulate. The neighbouring nation’s approach includes clear accountability measures for both financial institutions and telecommunications providers, alongside mechanisms for law enforcement intervention in fraud cases with victim consent.
Of particular concern is the apparent ease with which scammers access account holders’ personal information and contact details. Thuraisingham questioned the security protocols of banks and telecommunications companies, suggesting their current data protection measures may be inadequate.
The federation also addressed the growing problem of “re-scamming,” where victims fall prey to increasingly sophisticated fraudulent schemes that appear legitimate. This phenomenon has expanded beyond individual consumers to affect businesses, raising concerns about investor confidence in the Malaysian financial system.
“Bank Negara must move beyond voluntary guidelines to implement strict regulations ensuring zero negligence from commercial banks,” Thuraisingham insisted, adding that police should be granted powers to intervene in cases of persistent fraud, particularly in romance scam scenarios, subject to victim approval and clear evidence.
The call for reform comes amid growing concerns about the sophistication of financial scams in Malaysia and their impact on both individual consumers and businesses.
