Authored By: KASHMEERAN SURESH
MULTIMEDIA UNIVERSITY, MALAYSIA
Abstract
Problem Statement: Despite various anti-corruption measures in Malaysia, weak enforcement and the culture of money politics have sustained the spread of corruption. Political interference, selective prosecution, and kleptocratic ties between elites and businesses have kept corruption deeply rooted. Civil society organisations, such as Malaysia Incorporated (Malaysia Inc.), have worked to address these issues, though challenges remain.
Research Objective: This article aims to assess the extent of political corruption in Malaysia, evaluate the effectiveness of anti corruption mechanisms, and examine Malaysia Incorporated’s (Malaysia Inc.) compliance with anti-graft legislation.
Methodology: This research reviews the perceived levels of corruption in Malaysia by examining government efforts to address the issue. It highlights poor enforcement, persistent money politics, political interference in prosecutorial decisions, and the limited success of anti-corruption initiatives. The study concludes that Malaysia’s fight against corruption is undermined by its political and business culture and the ethical weaknesses of its leadership.
Keywords: Malaysian, Corruption, Bribery, Anti-Corruption Measures. 1.0
Introduction
Corruption is a major threat to global economic and social progress, as it undermines the rule of law, distorts policy, and misallocates resources. The definition is that the misuse of public power for personal gain in which corruption often involves bribery, the exchange of money, gifts, or favours for unethical or illegal actions.
In Malaysia, corruption is widespread across both public and private sectors, seen in practices like bribery, fraud, cronyism, bid-rigging, and money laundering. The 1981 Malaysia Incorpo rated Policy aimed to foster public-private cooperation, followed by the 1985 Privatisation Guideline and a 1991 master plan, which led to major projects like KLIA, LRT, Tanjung Pelepas Port, and the growth of companies like Tenaga Nasional Berhad and Telekom Malay sia.
Despite these initiatives, corruption has worsened, highlighted by scandals such as Bumiputra Malaysia Finance, Perwaja Steel, Forex, 1MDB, and Felda Global Ventures.1 This study shows anti-corruption measures have largely failed due to political interference, money politics, and weak enforcement, though civil society continues to push for reform.
Legal Framework Governing Bribery & Corruption in Malaysia
Corruption was traditionally handled by the police, but as the economy grew more complex, specialists were needed to tackle white-collar crimes. Over time, both Malaysia and the global community recognized corruption as a serious threat. In 2008, the Parliament established the Malaysian Anti-Corruption Commission (MACC), replacing the ACA Act 1982 with the MACC Act 2009. The Act came into force on January 1, 2009, establishing the MACC as an independent and transparent body to lead anti-corruption efforts.2
The MACC Act 2009 is Malaysia’s main anti-corruption law, applying to both public and pri vate sectors, and covering domestic and international cases. Its goal is to enhance integrity, accountability, and public awareness about the harms of corruption.
Courts have helped define “corruption” through case law, notably Public Prosecutor v Datuk Haji Harun Bin Haji Idris (No 2)3, where “corrupt” refers to actions done knowingly, with ill intent and for personal gain. Black’s Law Dictionary defines corruption as fraud or dishonesty by those in positions of authority. In Malay, “rasuah” stems from the Arabic “al-risywah,” meaning unlawful and forbidden.4
The Penal Code also covers bribery involving public officials, while the Election Offences Act 1954 addresses electoral bribery. Other relevant laws include the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLATFA) and the Customs Act 1967, both of which address bribery in specific contexts.5
Under the MACC Act6, “bribery” is not explicitly defined, but sections 16, 17, 18, 20, 21, and 22 cover various bribery offences, applying equally to the public and private sectors. Sections 3, 21, and 22 clarify that “gratification” includes both monetary and non-monetary rewards given for an unfair advantage. The Penal Code7, Sections 161-165 contains similar provisions focused on public servants.
Section 17A of the MACC Act, effective from June 1, 2020, introduced corporate liability, allowing companies and associated individuals to be held accountable if someone linked to the organisation engages in bribery.
Punishments for bribery under Section 24 of the MACC Act include imprisonment up to 20 years and a fine of at least five times the value of the gratification or RM10,000, whichever is higher. Section 18 violations carry the same prison term and fine based on the value of false information. The Penal Code (Section 161) allows for up to three years’ imprisonment, a fine, or both for public servants. For corporate offences under Section 17A, fines can be at least ten times the bribe amount or MYR 1 million, whichever is higher, plus up to 20 years’ imprison ment. The only defence under Section 17A is proving “adequate procedures” were in place to prevent bribery, similar to the UK Bribery Act 20108.
In civil law, corruption may result in claims for damages based on fraud, conspiracy, breach of fiduciary duty, or unjust enrichment. Victims may sue for recovery of bribe money, but proving corrupt intent can be difficult due to the secretive nature of bribery and challenges in accessing bank records, though formal discovery or third-party action may help.
Enforcement of these laws is primarily carried out by the MACC, supported by the Attorney General’s Chambers (AGC) and the police. The MACC investigates corruption cases, while prosecution requires AGC approval. If approved, the MACC’s Legal and Prosecution Division proceeds with the case. Special Anti-Corruption Courts, established in 2011, aim to speed up corruption trials.
The Anti-Corruption Measures and the Reasonings Behind the Continuance of Corruption in Malaysia
The Prevention of Corruption Ordinance (POCO), passed in 1950, marked Malaysia’s first step in combating corruption. However, POCO was widely criticised for its ineffectiveness, leading to its repeal and replacement by the Prevention of Corruption Act (POCA) in 1961. Inspired by similar legislation from Hong Kong, Ceylon, and Singapore, POCA aimed to strengthen anti-corruption efforts but still had significant shortcomings, especially regarding the powers of public prosecutors. It was subsequently amended in 1967 and 1971, but persistent flaws hindered the creation of an effective anti-corruption framework.
In 1997, after 26 years of attempts to improve the law, the Anti-Corruption Act was enacted, addressing many of the gaps left by previous legislation.
Post-independence, corruption cases were initially handled by the Criminal Investigation Department (CID) of the Royal Malaysian Police. In 1959, responsibility was split between the Corruption Prevention Unit under the Prime Minister’s Department and the Special Crime Branch (SCB) under CID.9 Both units struggled with inadequate training, poor coordination, and rising public complaints.
Mounting public pressure prompted the government to establish the Anti-Corruption Agency (ACA) in 1967, consolidating anti-corruption efforts. The ACA, created by administrative order rather than statute, faced challenges such as limited staffing, lack of autonomy, and appointment issues. Criticism over its effectiveness led to its replacement by the National Bureau of Investigation (NBI) in 1973. Unlike the ACA, the NBI was established by statute and given greater independence, including authority over staffing and broader investigative powers.10
Despite these reforms, the NBI faced criticism for its leniency toward high-profile offenders and weak institutional independence, prompting the government to dissolve it in 1982 and reinstate the ACA. The revamped ACA was given stronger powers, including asset monitoring, seizure, and legislative recommendations, which enhanced its investigative capabilities.
In 2009, the ACA was restructured into the Malaysian Anti-Corruption Commission (MACC), modelled after Hong Kong’s Independent Commission Against Corruption (ICAC). While the MACC’s formation was generally welcomed, concerns arose over the rushed nature of the reform and gaps in policy and procedure.
In parallel, the government introduced strategic frameworks such as the National Integrity Plan (2004) and the Government Transformation Programmes (GTPs). Under GTP 1.0, launched in 2010 by then-Prime Minister Najib Razak, corruption was identified as a National Key Results Area (NKRA). Ministries were tasked with setting targets and tracking anti-corruption progress, but the results were underwhelming.
Following the 14th general election, Malaysia intensified its anti-corruption agenda by creating the Special Cabinet Committee on Anti-Corruption (JKKMAR) and the Governance, Integrity and Anti-Corruption Centre (GIACC). In 2019, the National Anti-Corruption Plan (NACP) was introduced, replacing the National Integrity Plan. It targeted six areas: political governance, public sector management, procurement, legal and judicial processes, law enforcement, and corporate governance, emphasising transparency, accountability, efficiency, and effectiveness.
Despite structural improvements, corruption remains entrenched in Malaysia. One major issue is weak enforcement: only 28% of those arrested for corruption are convicted, and punishments are often lenient. The NACP flagged the absence of minimum sentencing under the MACC Act (Act 694), which, as of 2021, resulted in 55% of convicted offenders receiving only fines, and some serving as little as a single day in jail.
Another factor is “money politics”—a deeply rooted relationship between business elites and politicians, particularly within UMNO and BN. Business donations often secure political favours, especially during elections, creating an environment where corrupt practices are tolerated as long as public-facing projects are delivered.
Political interference further undermines anti-corruption efforts. Leaders have obstructed investigations by agencies like the Auditor-General’s Department, Public Accounts Committee, AGC, and the MACC. The 1MDB scandal is a prime example, where political interference hindered investigations and sensitive documents were suppressed under the Official Secrets Act.
Public mistrust in anti-corruption efforts also persists, as reflected in Malaysia’s consistently poor CPI scores. While several measures have been introduced, the public remains unconvinced of the government’s commitment.
Civil society organisations have grown more active in highlighting corruption and political interference. Though previously stifled, their space widened after 2018, with initiatives such as the Politikus programme by the Sinar Project helping to raise awareness and gather evidence for investigations.11
Conclusion and Recommendations
Corruption continues to be a major challenge in Malaysia, undermining the rule of law, eroding public trust, and stifling economic development. Despite ongoing efforts to combat it, a more comprehensive and multifaceted approach is necessary to address its root causes. One of the key factors contributing to corruption is the lack of transparency and accountability in government operations, which allows corrupt officials to engage in illicit activities without detection. To tackle this issue, the government must implement systems such as regular audits, financial disclosures, and public access to records to ensure greater transparency and accountability. Another significant issue is the weakness of the country’s laws and enforcement agencies, which makes it difficult to prosecute those involved in corruption. Strengthening these laws, increasing penalties for corruption offences, and providing additional resources to law enforcement agencies are critical steps to ensuring that corruption cases are properly investigated and prosecuted.
Public awareness and education also play a crucial role in addressing corruption. The government should focus on educating the public about the negative impacts of corruption and encourage citizens to report suspicious activities. Setting up an autonomous anti-corruption commission would create a specialized institution responsible for handling investigations and prosecutions of corruption, thereby strengthening the overall impact of anti-corruption initiatives. Furthermore, promoting integrity and ethical conduct within both the public and private sectors is crucial for long-term success. Promoting ethical conduct, providing ethics training, and encouraging transparency are all key steps toward cultivating such a culture. Public and private organisations should also consider implementing ISO 37001 Anti-Bribery Management Systems to ensure that adequate measures are in place to prevent bribery and unethical practices.
Malaysia’s diverse cultural context necessitates a focus on universally accepted values that can unite the population and promote national cohesion. Islamic principles, which emphasize moral integrity, offer a solid foundation for addressing corruption. These values, such as trust, responsibility, sincerity, and dedication, can guide both citizens and state officials towards a more ethical approach to governance. By embedding these principles into the fabric of society, Malaysia can create a culture of integrity that supports the country’s broader efforts to combat corruption.
In conclusion, tackling corruption in Malaysia requires a comprehensive strategy that addresses the underlying causes through increased transparency, strengthened laws, public education, and the promotion of ethical behaviour. By taking these actions, Malaysia can make significant progress in reducing corruption and fostering a more just and equitable society.
Reference(S)
Primary Sources
Statutes
Act 694
Act 574
Cases
Public Prosecutor v Datuk Haji Harun Bin Haji Idris (No 2) [1977] 1 MLJ 15 (High Court) Secondary Sources
Online Journals
“Anti-Corruption Initiatives: Experience of Several Southeast Asia …” <https://gadingss.learningdistance.org/index.php/gadingss/article/view/236>
“Guidance on Good Practice and Checklist for Adequate Procedures” (Transparency International Malaysia) <https://transparency.org.my/pages/news-and events/publications/guidance-on-good-practice-and-checklist-for-adequate-procedures>
“Malaysia Country Risk Report” (GAN Integrity) <https://ganintegrity.com/country profiles/malaysia/>
Azmi KSA and Zainudin R, “Money in Politics: A Recipe for Corruption in Malaysia” (Journal of Financial Crime, 26 October, 2020) <https://www.emerald.com/insight/content/doi/10.1108/JFC-07-2020-0147/full/html>
Corruption: The Law and Challenges in Malaysia [2021] 1 ILJA ii
Durairaja S and others, “Corruption in Malaysia: A Review” (SRS Journal, 23 June, 2019) <https://doi.org/10.17485/ijst/2019/v12i24/143798>
Haizan RYBA and Bookmark Bookmark Share WhatsApp Telegra, “High-Profile Court Cases Involving Malaysian Political Leaders to Look out for This Year” (CNA) <https://www.channelnewsasia.com/asia/malaysia-high-profile-court-case-ahmad-zahid hamidi-najib-razak-syed-saddiq-lim-guan-eng-3179916>
Kapeli NS and Mohamed N, “Battling Corruption in Malaysia: What Can Be Learned?” (Journal of Financial Crime, 1 April, 2019) <https://www.emerald.com/insight/content/doi/10.1108/JFC-04-2018-0044/full/html>
1 Durairaja S and others, “Corruption in Malaysia: A Review” (SRS Journal, 23 June, 2019) <https://doi.org/10.17485/ijst/2019/v12i24/143798>.
2“Anti-Corruption Initiatives: Experience of Several Southeast Asia …” <https://gadingss.learningdistance.org/index.php/gadingss/article/view/236>.
3[1977] 1 MLJ 15 (High Court).
4[2021] 1 ILJA ii.
5“Malaysia Country Risk Report” (GAN Integrity) <https://ganintegrity.com/country-profiles/malaysia/>. 6 Act 694.
7 Act 574.
8“Guidance on Good Practice and Checklist for Adequate Procedures” (Transparency International Malaysia) <https://transparency.org.my/pages/news-and-events/publications/guidance-on-good-practice-and-checklist for-adequate-procedures>.
9 Haizan RYBA and Bookmark Bookmark Share WhatsApp Telegra, “High-Profile Court Cases Involving Malaysian Political Leaders to Look out for This Year” (CNA) <https://www.channelnewsasia.com/asia/malaysia-high-profile-court-case-ahmad-zahid-hamidi-najib-razak syed-saddiq-lim-guan-eng-3179916>.
10 Kapeli NS and Mohamed N, “Battling Corruption in Malaysia: What Can Be Learned?” (Journal of Financial Crime, 1 April, 2019) <https://www.emerald.com/insight/content/doi/10.1108/JFC-04-2018-0044/full/html>.
11 Azmi KSA and Zainudin R, “Money in Politics: A Recipe for Corruption in Malaysia” (Journal of Financial Crime, 26 October, 2020) <https://www.emerald.com/insight/content/doi/10.1108/JFC-07-2020- 0147/full/html>.
