Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) – Digital Currencies (Sector 6)

This document sets out the minimum requirements and standards that a reporting institution must observe to increase the transparency of activities relating to digital currencies and ensure effective and robust AML/CFT control measures are put in place to mitigate risks that reporting institutions may be used as conduits for illegal activities. The requirements and standards will also support law enforcement activities.

1.6 The Bank reiterates that digital currencies are not recognised as legal
tender in Malaysia. Members of the public are therefore advised to
undertake the necessary due diligence and assessment of risks involved
in dealing in digital currencies or with entities providing services
associated with digital currencies. 

2. Scope
2.1 Pursuant to the AMLA, any person carrying on the activities listed in
Paragraph 4.1 must comply with requirements in this document relating
to:
(a) the identification and verification of customers and beneficial
owners, on-going monitoring of customers’ transactions, sanction
screening, suspicious transaction reporting and record keeping;
(b) transparency obligations; and
(c) requirements for the submission of data and statistics to the Bank
for the purpose of managing ML/TF risks.

4. Applicability
4.1 This document is applicable to reporting institutions carrying on the
following activities as listed in Paragraph 25 of the First Schedule to the
AMLA:
(a) activities carried out by any person who provides any or any
combination of the following services:
(i) exchanging digital currency for money;
(ii) exchanging money for digital currency; or
(iii) exchanging one digital currency for another digital currency,
whether in the course of carrying on a digital currency exchange
business or otherwise.
4.2 For the avoidance of doubt, any person carrying on the activities listed in
Paragraph 4.1 is subject to this document, regardless that the person does
not have physical presence in Malaysia.
4.3 Where a reporting institution is subject to more than one AML/CFT policy
issued pursuant to section 83 of the AMLA, the more stringent
requirements shall apply. 

Table of Contents
PART A OVERVIEW .....................................................................................2
1. Introduction...................................................................................2
2. Scope ...........................................................................................3
3. Legal Provisions ...........................................................................4
4. Applicability...................................................................................4
5. Effective Date ...............................................................................5
6. Definition and Interpretation..........................................................5
PART B AML/CFT REQUIREMENTS .........................................................11
7. Declaration to the Bank...............................................................11
8. Risk-Based Application...............................................................12
9. Customer Due Diligence (CDD)..................................................14
10. Politically Exposed Persons (PEPs)............................................22
11. New Digital Currencies, Products and Business Practices..........24
12. Reliance on Third Parties............................................................24
13. Higher Risk Countries.................................................................26
14. Failure to Satisfactorily Complete CDD.......................................27
15. Management Information Systems..............................................27
16. Record Keeping..........................................................................28
17. Appointment of Compliance Officer.............................................28
18. Suspicious Transaction Report ...................................................31
19. Combating the Financing of Terrorism ........................................35
20. Reporting and Transparency Requirements................................37
21. Non-Compliance.........................................................................38

Document Details

Document Type: 
Doument Author (Entity): 
Authoring Country: 
Originating Country or Trade Block: 
Issue Status: 
Year of Document: 
2018
Date of Document: 
Tuesday, February 27, 2018
Language (This Document): 
English

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