SETTING up offshore accounts is permitted under current laws but customers will have to undergo a due diligence process, Finance Minister Tengku Zafrul Abdul Aziz told the Dewan Rakyat today. “Under current laws, any individual can open accounts at licensed banks including offshore accounts,” he said. “However, all customers who open accounts at licensed banks regulated by Bank Negara Malaysia or offshore accounts regulated by Labuan Financial Services Authority (Labuan FSA) have to undergo the customer due diligence process as stipulated under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001,” he added. Tengku Zafrul said unlike certain jurisdictions, the Malaysian financial system is highly regulated by BNM under several laws including the Financial Services Act 2013 and the Islamic Financial Services Act 2013. As for offshore activities in Labuan, Tengku Zafrul said this is regulated by Labuan FSA via the Labuan Financial Services and Securities Act and Labuan Islamic Financial Services and Securities Act. Tengku Zafrul was responding to a supplementary question by his predecessor Lim Guan Eng (Bagan-Pakatan Harapan) on the efforts taken to recover funds from offshore accounts following the Pandora Paper leaks. The Pandora Papers are an anonymous dump of 2.94 terabytes of confidential financial files to the Investigative Consortium of Investigative Journalists. The dump is made up of more than 11.9 million documents and records from 14 offshore service providers that set up and manage shell companies and trusts in tax havens around the globe. Tengku Zafrul was among the prominent figures named in the leak along with Umno chief Dr Ahmad Zahid Hamidi, former finance minister Daim Zainuddin and Selayang MP William Leong. Tengku Zafrul was named director of the Labuan Incorporated Capital Investment Bank (Labuan) Ltd in documents from Panama law firm Alemán, Cordero, Galindo & Lee. He, however, said that he had relinquished all executive and directorship roles at Kenanga Group in 2010. – October 5, 2021.