ISO 37001: 2016

ANTI-BRIBERY MANAGEMENT SYSTEM (ABMS)

FIGHTING BRIBERY AND

CORRUPTION
- A sustainable initiative towards achieving
Zero Tolerance to Corruption

SUTINAH SUTAN (Dato’)

Independent Consultant
[email protected]
HOTEL ISTANA, KUALA LUMPUR
9-10 JANUARY 2019
Pilot project by National Centre for
Implemented by
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and Anti-Corruption (GIACC)
 SCOPE
FORMS, TYPES AND NATURE OF CORRUPTION
LEGAL REQUIREMENT: CORRUPTION OFFENCES
& LEGAL DUTIES
HOW BIG IS OUR CORRUPTION PROBLEM?
CAUSES OF CORRUPTION
PRESCRIPTION FOR CORRUPTION PROBLEM
HOW CORRUPTION PREVENTION RELATED TO
ABMS
Pilot project by National Centre for
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 FORMS OF
CORRUPTION

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 COMMON TERMINOLOGIES

• kickback, under counter payment,

facilitation payment, grease money,
tea/coffee money (Malaysia)
• Little envelope (Italy)
• Air supply (Uganda)
• Pungli - Pungutan Liar (Indonesia)
• 19.90 (US)
• Sleaze (UK)
• Black Mist (Japan)
• A jug of wine (France)
 FORMS OF CORRUPTION
• Bribery – the payment in money/kind
that is given in a corrupt relationship.It
has many names such as facilitating
payments, pay-off, sweetener, grease
money etc
• Embezzlement – when employees steal
company resources they are hired to
administrate; theft from work place in
the broadest sense
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 FORMS OF CORRUPTION
• Fraud – when an employee (agent) who is
responsible for carrying out orders or
tasks assigned by his superiors
(principal), manipulates the flow of
information to his private benefit
• Extortion – money or other resources
extracted by the use of coercion,violence
or threats to use force
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 FORMS OF CORRUPTION
• Favouritism – a mechanism of power abuse
implying ‘privatisation’ and a highly biased
distribution of state resources in order to
favour friends, family or others related to
the employees
• Nepotism – a special form of favouritism in
which an office holder (ruler) prefers his
proper kinfolk and family members

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 CLASSIFICATION
• Grand – takes place on the hiher levels of
political authority and involves head of
states,ministers and top officials who are
in control of resources and legislations
• Petty corruption – or ‘bureaucratic’
corruption takes place on a low
bureaucratic level and typically bribe
takers are police officers, customs, taxing
and licensing authorities
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 TYPES & NATURE OF BRIBERY
 SPOTANEOUS
 INSTRUMENTAL
 INDIVIDUALISTIC
 SYNDICATED
 INVOLVING TWO PARTIES OR MORE
 SECRETIVE
 CONSENSUAL ACT
 A WIN-WIN SITUATION
 INVOLVE ABUSE OF POWER/AUTHORITY

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 DEFINITION OF
CORRUPTION

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 Definition of Corruption

“Misuse of public power, office or

authority for private benefit .....”
[UNDP, 2011]

“a civil servant abuses his

authority in order to obtain an
extra income from the public”
(Jacob Van Kleveren,
The Concept of Corruption)

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 “Corruption equals monopoly plus
discretion minus accountability
(C = M + D –A)
… one will tend to find corruption
when an organization or a person has
monopoly power over a good or
service, has the discretion to decide
who will receive it and how much that
person will get, and is not
accountable.”
Robert Klitgaard

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 “Corrupt means
doing an act
knowing that the
act done is wrong,
doing so with
evil feelings and
evil intentions”
PP vs Datuk Harun Idris,
Ex-Chief Minister of Selangor

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 CORRUPTION
OFFENCES FROM
ISLAMIC PERSPECTIVE

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 KESALAHAN RASUAH MENGIKUT AL-QURAN

“Dan janganlah kamu makan (atau

mengambil) harta (orang-orang lain)
diantara kamu dengan jalan yang salah,
dan jangan pula kamu menghulurkan
harta kamu (memberi rasuah) kepada
hakim-hakim kerana hendak memakan
(atau mengambil) sebahagian dari harta
manusia dengan (berbuat) dosa, padahal
kamu mengetahui (salahnya)”.
(Surah Al-Baqarah - Ayat 188)

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 Hadith Rasulullah s.a.w. bermaksud:

“Allah melaknat kepada orang

yang memberi rasuah dan
menerima rasuah serta orang yang
memberi jalan terhadap keduanya”

(Riwayat At-Tirmidzi)

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 “Sesiapa sahaja yang telah kami
lantik untuk memegang sesuatu
jawatan atau kerja dan kami telah
tetapkan pendapatannya atau gaji
maka apabila ia mengambil lebih dari
apa yang ditetapkan itu dikira sebagai
satu penipuan dan rasuah”

Riwayat Abu Daud

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 CORRUPTION
OFFENCES

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 RELATED LAWS ON
CORRUPTION PREVENTION
 Malaysian Anti-Corruption Commission Act 2009
(Amendment 2018)
 Section 137 Customs Act 1967 (Act 235)
 Penal Code – Sec. 161, 162, 163, 164, 165, 213,
214 and 215
 Part III of the Election Offences Act 1954 (Act 5)
 Anti-Money Laundering, Terrorist Financing and
Proceeds of Unlawful Activities Act 2001
(AMLATFA)
 Mutual Assistance In Criminal Matters Act 2002
 Whistleblower Protection Act 2010
 Witness Protection Act 2009 (Act 696)
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 Legal requirements …..

 CORRUPTION OFFENCES
 YOUR LEGAL OBLIGATIONS
 LAWS THAT PROTECT YOU

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 PRINCIPAL OBJECTS OF
ACT – Section 2

(a) to promote the integrity and

accountability of public and
UNDANG-UNDANG private sector administration
MALAYSIA by constituting an
LAWS OF MALAYSIA independent and
accountable anti-corruption
body; and

AKTA SURUHANJAYA PENCEGAHAN (b) To educate public

RASUAH MALAYSIA 2009 authorities, public officials
(Akta 694)
and members of the public
MALAYSIAN ANTI-CORRUPTION about corruption and its
COMMISSION ACT 2009
(Act 694) detrimental effects on public
and private sector
administration and on the
community.

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 3 MAIN OFFENCES – MACC Act 2009
BRIBERY
1. • giving gratification Sec. 16 & 17

• accepting gratification

giving or using false

2. Section 18
documents to make claims

abuse of public office for

3. pecuniary advantage Section 23

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 CORRUPTION OFFENCES
include :-

 an attempt to commit any of

the offences
 an abetment of or a criminal
conspiracy to commit the
offence

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 OFFENCE OF
GIVING OR
UNDANG-UNDANG
MALAYSIA ACCEPTING
LAWS OF MALAYSIA GRATIFICATION
BY AGENT
AKTA SURUHANJAYA PENCEGAHAN
RASUAH MALAYSIA 2009
(Akta 694)
[ Section 17
MALAYSIAN ANTI-CORRUPTION MACC Act 2009
COMMISSION ACT 2009
(Act 694) (Act 694) ]

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 “GRATIFICATION” means;
– (Section 3, MACC Act 2009 (ammendment 2018))

(a) money, donation, gift, loan, fee, reward, valuable security, property or interest in
property being property of any description whether movable or immovable,
financial benefit, or any other similar advantage;
(b) any office, dignity, employment, contract of employment or services, and agreement
to give employment or render services in any capacity;
(c) any payment, release, discharge or liquidation of any loan, obligation or other
liability, whether in whole or in part;
(d) any valuable consideration of any kind, any discount, commission, rebate bonus,
deduction or percentage;
(e) any forbearance to demand any money or money’s worth or valuable thing;
(f) any other service or favour of any description, including protection from any penalty
or disability incurred or apprehended or from any action or proceedings of a
disciplinary, civil or criminal nature, whether or not already instituted, and
including the exercise or the forbearance from the exercise of any right or any
official power or duty; and
(g) any offer, undertaking or promise, whether conditional or unconditional, of any
gratification within the meaning of any of the preceding paragraphs (a) to (f).

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 “agent” – Section 3, MACC Act 2009 (ammendment 2018)
means any person employed by or acting
for another, and includes an officer of a
public body or an officer serving in or under
any public body, a trustee, an administrator
or executor of the estate of a deceased
person, a sub-contractor, and any person
employed by or acting for such trustee,
administrator or executor, or subcontractor.

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 “principal” – Section 3
includes any employer, any beneficiary
under a trust, any trust estate, any person
beneficially interested in the estate of a
deceased person, the estate of the deceased
person, and in the case of any person
serving in or under a public body, the public
body.

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 OFFENCE OF GIVING OR ACCEPTING
1 GRATIFICATION BY AGENT
[Section 17 MACC Act 2009]

A person commits an offence if –

(a) being an agent, he corruptly accepts, or attempt to
obtain for himself or for any other person, any gratification
as an inducement or a reward or for showing or forbearing
to show favour to any person in relation to his principal’s
affairs or business.
(b) he corruptly gives any gratification to any agent as an
inducement or a reward for doing or forbearing to do, or
for showing or forbearing to show favour to any person in
relation to his principal’s affairs or business.
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Example:
PP vs MSM
That you on 15.1.2010 around 1.30 pm at D’Atas
Brasseri, Floor 9, Hotel Legend, ….. being an agent, ie.
Procurement Officer with XXX Bank corruptly received
for yourself, a gratification, ie. cash money totaling
RM17,000.00 from ABI, Director of Syarikat Masterkleen
Sdn. Bhd. as a reward for doing an act ie. awarding
Syarikat Masterkleen Sdn. Bhd. for carpet and office
cleaning jobs at the Bank, and thereby, you have
committed an offence under Section 17(a) of the
Malaysian Anti-Corruption Commission Act 2009 (Act
694), punishable under Section 24 of the same Act.

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 SECTION 165, PENAL CODE

PUBLIC SERVANT OBTAINING ANY

VALUABLE THING, WITHOUT
CONSIDERATION, FROM PERSON
CONCERNED IN ANY PROCEEDING OR
BUSINESS TRANSACTED BY SUCH
PUBLIC SERVANT

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 Whoever, being a public servant, accepts or
obtains, or agrees to accept or attempts to
obtain, for himself or for any other person, any
valuable thing, without consideration, or for a
consideration which he knows to be inadequate,
from any person whom he knows to have been,
or to be, or to be likely to be concerned in any
proceeding or business transacted, or about to
be transacted, by such public servant, or having
any connection with the official functions of
himself or of any public servant to whom he is
subordinate, or from any person whom he knows
to be interested in or related to the person so
concerned, shall be punished with imprisonment
for a term which may extend to two years or
with fine or with both.
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 Sek. 165 Kanun Kesiksaan
Bahawa kamu pada 4 April 1995, di Garden City, Ujong Pasir,
Melaka dalam Daerah Melaka Tengah, dalam Negeri Melaka
semasa menjadi seorang penjawat awam iaitu Pengarah
Penilaian Dan Pengurusan Harta, Majlis Perbandaran Melaka
Bandaraya Bersejarah telah menerima untuk diri kamu suatu
benda yang bernilai, iaitu sebuah kereta Mercedes Benz E280
nombor pendaftaran WDV 9, tanpa balasan daripada Chan
Kok Chuang yang mana kamu mengetahui ada kena mengena
dengan urusan tugas rasmi kamu berhubung permohonan
Projek Penswastaan Pembinaan Terminal Bas/Teksi dan
Pusat Bandar di Semabok oleh Liga Maju Sdn. Bhd. yang
mana permohonan berkenaan telah diproses oleh kamu
dengan itu kamu telah melakukan satu kesalahan yang boleh
dihukum di bawah seksyen 165 Kanun Keseksaan [N.M.B.
(Bab 45)].

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 OFFENCE OF INTENDING
2 TO DECEIVE PRINCIPAL BY AGENT
(Section 18, MACC Act 2009)

A person commits an offence if he

gives to an agent, or being an agent he
uses with intent to deceive his principal,
any receipt, account or other document in
respect of which the principal is interested,
and which he has reason to believe
contains any statements which is false or
erroneous or defective in any material
particular, and is intended to mislead the
principal.
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 Example:

In 2005, the accused, Ismail Bin Zainuin,

Secretary General of the Persatuan Rifel
Kebangsaan Malaysia, gave to an agent ie.
Finance Officer of the Majlis Sukan Negara
(MSN) an invoice no. 1017 belonging to
Vision Arms Sports Centre Sdn. Bhd.
amounting RM285,000 to MSN that contains
statements which he knew was false where
the items were paid but never supplied.
He was found guilty and was sentenced to 3 months
jail and fined RM 2,205,000, i/d 6 months jail.
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 OFFENCE OF USING OFFICE OR
3 POSITION FOR GRATIFICATION
(Section 23, MACC Act 2009)

Any officer of a public body who uses his

office of position for any gratification,
whether for himself, his relative or
associate, commits an offence
– when he makes any decision, or takes
any action, in relation to any matter in
which such officer, or any relative or
associate of his, has an interest, whether
directly or indirectly.
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Interpretation of
“RELATIVE”
grandmother/
* Excluding
grandfather spouses
uncles*
mother/father cousins*
aunties*

wife/
sisters brothers husband YOU brothers sisters

nephews/nieces*
son-in laws/ daughters/
daughter-in laws sons “cucu saudara”*

Grand children
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 Eg: Offence under Sec. 23(1) – Abuse of Public Office
“X, sebagai pegawai badan awam di Universiti Sains Malaysia
telah menggunakan jawatannya memilih syarikat Arena Mulia
Enterprise untuk:

1) Membalut 20 kerusi banquet bernilai RM1,200.00

2) Membekal dan memasang span 1/2 inci beserta kain
kanvas bernilai RM5,736.00
3) Membekal kerja-kerja servis dan pengisian semula 466
unit cecair penyegar bernilai RM3500.00
4) Membekal dan memasang 'Urinal Sanitizer Dispenser
Model MS600P' sebanyak 466 unit bernilai RM47998.00;
berhubung dengan perkara yang dia mempunyai kepentingan
iaitu pemilik syarikat Arena Mulia Enterprise adalah adik
kandungnya.”
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 Eg: PP vs DATUK JOSEPH PAIRIN KITINGAN

“That you ….. whilst being a member of the

administration, namely the Chief Minister of
Sabah, committed corrupt practice by using
your public position for your advantage, in
that you did approve the award on a contract
in the sum of RM1,483,341.60 for the
construction of 12 units of 2 storey SEDCO
shop houses Phase II in Tambunan to
RIMKAYA Sdn. Bhd., in which your relatives
were amongst the director-cum-shareholders
…..”

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 DUTY TO REPORT BRIBERY TRANSACTIONS
BY PUBLIC OFFICER
Sec. 25 (1)

ANY OFFICER OF A PUBLIC BODY TO WHOM ANY

GRATIFICATION IS GIVEN, PROMISED, OR OFFERED,
IN CONTRAVENTION OF ANY PROVISION OF THIS
ACT SHALL REPORT SUCH GIFT, PROMISE OR OFFER
TOGETHER WITH THE NAME, IF KNOWN, OF THE
PERSON WHO GAVE, PROMISED OR OFFERED SUCH
GRATIFICATION TO HIM TO THE NEAREST OFFICER
OF THE AGENCY OR POLICE OFFICER.

Penalty: Fine not exceeding RM100,000

or imprisonment not exceeding 10 years
or to both.
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 DUTY TO REPORT BRIBERY TRANSACTIONS
BY ANY PERSON
Sec. 25 (3)

ANY PERSON FROM WHOM ANY GRATIFICATION HAS BEEN

SOLICITED OR OBTAINED, OR AN ATTEMPT HAS BEEN MADE TO
OBTAIN SUCH GRATIFICATION, IN CONTRAVENTION OF ANY
PROVISION OF THIS ACT SHALL AT THE EARLIEST OPPORTUNITY
THEREAFTER REPORT SUCH SOLICITING OR OBTAINING OF, OR
ATTEMPT TO OBTAIN, THE GRATIFICATION TOGETHER WITH
THE FULL AND TRUE DESCRIPTION AND, IF KNOWN, THE NAME
OF THE PERSON WHO SOLICITED, OR OBTAINED, OR
ATTEMPTED TO OBTAIN, THE GRATIFICATION FROM HIM TO
THE NEAREST OFFICER OF THE AGENCY OR POLICE OFFICER.

Penalty: Fine not exceeding RM10,000

or imprisonment not exceeding 2 years
or to both.
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 LEGAL PROTECTION

• MALAYSIAN ANTI-CORRUPTION
COMMISSION ACT 2009 (amendment 2018)
- Section 29
- Section 65

• WITNESS PROTECTION ACT 2009

• WHISTLEBLOWER PROTECTION ACT

2010
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 SECRECY OF REPORT LODGED TO THE MACC

“A report made under subsection (1)

shall be kept secret and shall not be
disclosed by any person to any
person other than officers of the
Agency and the Public Prosecutor
until an accused person has been
charged in court for an offence under
this Act …”
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 IDENTITY OF INFORMERS
& INFORMATION ARE
PROTECTED BY THE LAW

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 Section 65 (1)
“ …. where any complaint made by an officer of the
commission states that the complaint is made in
consequence of information received by the officer
making the complaint, the information referred to in
the complaint and the identity of the person from
whom such information is received shall be secret
between the officer who made the complaint and the
person who gave the information, and everything
contained in such information, identity of the person
who gave the information and all other circumstances
relating to the information, including the place where
it was given, shall not be disclosed or be ordered or
required to be disclosed in any civil, criminal or other
proceedings in any court, tribunal or other authority”

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 CORRUPTION IN THE PUBLIC
SECTOR,
HOW BIG IS THE PROBLEM?

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 Illicit Financial Outflows of Dirty
Money from Developing Countries
- Study by the Global Financial
Integrity
(GFI - an international anti-corruption group

•Malaysia ranked 5th

•Malaysia has lost RM171.11 billion in 2012
•Malaysia has lost RM1.38 trillion since 2003
- corruption
- tax evasion
- organized crime
 CORRUPTION SITUATION
Perceived level of corruption for Malaysia [CPI 1995 – 2017]

10 Highest level of corruption

9
8
7
6
SCORE

5
4
3
2
1
Lowest level of corruption
0
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
5.28 5.32 5.01 5.30 5.10 4.80 5.00 4.90 5.20 5.00 5.10 5.00 5.01 5.01 4.50 4.40 4.30 4.90 5.0 5.2 5.0 4.9 4.7
23 26 32 29 32 36 36 33 37 39 39 44 43 47 56 56 60 54 53 50 54 55 62

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 ‘ A FULL POINT INCREASE IN THE
CORRUPTION LEVEL IS
ASSOSIATED WITH A 16%
REDUCTION IN THE FLOW OF
FOREIGN DIRECT INVESTMENT
(FDI) ’

(Research done by Prof. Shang-Jin Wei from Kennedy

School of Government, Havard University)
(Source: TI Source Book)

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 BRIBERY AND CORRUPTION KEEPS RISING…

Malaysian organization are not doing enough to

protect themselves

Reported incidents of bribery and corruption

continue to increase from

19% 30% 35%

It is concerning that Malaysian organizations appear to
be ambivalent about addressing the risks of bribery and
corruption
Source: pwc, 2018

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 THE DRIVERS OF FRAUD

OPPORTUNITY

85%

FRAUD RISK

42% 39%
INCENTIVES OR RATIONALIZATION
PRESSURE TO PERFORM Source: pwc, 2018
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  OPPORTUNITIES
 weak procedures
 red tape
 lack of transparency
 high level of discretion
 MOTIVE or PRESSURE
 heavily indebtedness
 political pressure
 to meet target/KPI
 sale before expiry date
 RATIONALIZATION – WRONG MINDSET
 “I did not demand, they wanted to give”
 “If my boss did it and not get caught, why not
me?”
 “Ini anggaplah sedekah”
 “I can’t help it, it is part of doing business”
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 STATISTIC ON CORRUPTION CASES UNDERTAKEN BY MACC
(2011 TO 2018)

OVERALL REPORT ON INVESTIGATION NO OF

YEAR REPORT CHARGED CONVICTED
CORRUPTION PAPERS ARREST

2011 13,325 6,475 1,304 918 293 299

2012 11,765 5,485 1,078 701 350 212

2013 7,927 3,946 976 509 296 173

2014 6,584 2,954 919 552 334 230

2015 6,343 2,982 982 841 223 162

2016 6,551 NA 985 939 268 172

2017 7,348 NA 863 879 373 216

2018 7,920 NA 833 896 293 210

7,940 6,235 2,430 1,674
TOTAL 67,763 -
(11.7%) (9.2%) (3.6%) (2.5%)
Source: MACC (4.1.2019)
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 STATISTIK TANGKAPAN MENGIKUT PECAHAN SEKTOR BAGI
TAHUN 2016 - 2018

Pegawai Orang Ahli Ahli Lain-

TAHUN Swasta Jumlah
Awam Awam Politik Majlis lain

2016 467 210 239 3 0 22 941

2017 408 168 271 12 0 23 882

2018 423 183 220 24 0 46 896

1,298 561 730 39 91

Jumlah 0 2,719
(47.7%) (20.6%) (26.8%) (1.4%) (3.3%)
Source: MACC (4.1.2019)
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 NO OF ARRESTS BY SECTORS & TYPES
OF OFFENCES [ 2011 – 2015 ]
1410 558 1548 7 2
(40%) (15.8%) (43.9%) (0.2%) (0.1%)
100%
Other
80% offences
Misuse of
60% position
False claims
40%
Giving
bribes
20%
Receiving
bribes
0%
Public Private Members Politicians Town
Sector Sector Of Public Council
Source: MACC (4.1.2019) Members

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 NO OF ARRESTS BY SECTORS & TYPES
OF OFFENCES [ 2016 – 2018 ]

TYPES OF 2016 2017 2018

OFFENCES PK SW OA AP LL PK SW OA AP LL PK SW OA AP LL

Received
315 51 81 0 15 275 48 60 9 15 230 73 62 10 19
Bribes
Gave
5 57 129 0 1 4 65 172 1 0 0 21 99 3 1
Bribes
False
114 76 11 0 4 82 36 21 0 3 103 69 42 0 18
Claims
Abuse of
12 8 1 0 7 31 11 8 1 3 71 5 7 4 4
Position
Others 14 18 16 0 4 18 10 5 1 2 19 15 10 7 4

Total 460 210 238 0 31 410 170 266 12 23 423 183 220 24 46

TOTAL 939 881 896

Source: MACC (4.1.2019)
Pilot project by National Centre for
Implemented by
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and Anti-Corruption (GIACC)
 HIGH RISK AREAS IN PULIC SECTOR:
 PROCUREMENT
 DEVELOPMENT PROJECTS
 ENFORCEMENT
 LICENSING/PERMITS
 LAND MATTERS
 REVENUE COLLECTION
 ASSET/STORE MANAGEMENT
 SUBSIDIES MANAGEMENT
 FINANCE & ACCOUNT
 HUMAN RESOURCE

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 KPMG Malaysia
Fraud, Bribery and Corruption Survey 2013

71% of respondents believed that

bribery is an inevitable cost of doing
business

64% believed business can’t be done

in Malaysia without paying bribes

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 INTERNATIONAL
DIMENSION

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
  WTO (transparency in GP for global trade)
 INTERNATIONAL DONORS eg. WB, ADB
 UNCAC – Declaration Against Corruption
 INTERNATIONAL CHAMBER OF COMMERCE
– Rules of Conduct to Combat Extortion and
Bribery
 FOREIGN DIRECT INVESTORS
 APEC – Santiago Commitment to Fight
Corruption and Ensure Transparency
 NGO – eg. T.I. (Corruption Indexes)

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 SANTIAGO COMMITMENT
TO FIGHT CORRUPTION AND ENSURE
TRANSPARENCY (21 November 2004)

APEC Course of Action on Fighting

Corruption and Ensuring Transparency
“… commitment to cooperate in APEC to
implement concrete actions to fight
corruption and ensure transparency and
accountability in the proper management
of public affairs and public property, …”

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 PREVENTING BRIBERY &
CORRUPTION IN YOUR
ORGANIZATION

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 HIGH LOW
REWARDS REWARDS
and and
LOW DETECTION HIGH DETECTION
RISK RISK

EASY TO COMMIT HARD TO COMMIT

and AND EASY TO
HARD TO DETECT DETECT

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 WHAT and WHERE
to look for corruption?

 BREEDING AREAS

 SYMPTOMS

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 WHERE ARE THE BREEDING
AREAS?

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
Unclear Lack EFFECTS
policies, rules
CAUSES supervision
& regulations, and
- inadequate Code of Ethics – monitoring,
outdated, not insufficient inefficiency,
practical, publicity, poor
outdated, weak handling of
ABUSE
uncontrolled OF
discretionary enforcement public
complaints POWER
power
Untrained CORRUP-
Staff TION
System and
procedures are Weak FRAUD
Low level of leadership,
integrity – greed, not transparent,
no check & not hands-
living beyond on, unclear
means balances, work
manuals - direction,
outdated, delay absolute
power MACC
Pilot project by National Centre for
Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Contoh: TUNTUTAN PERJALANAN
OLEH AHLI LEMBAGA PENGARAH
RISDA DAN ANAK SYARIKATNYA

• Wujud peluang rasuah

• Ahli Lembaga membuat dua tuntutan
bertindih.
• Kerugian kepada Kerajaan.
• Tiada dasar/peraturan yang melarang.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Contoh: KAEDAH-KAEDAH MOTOR
VEHICLES (PROHIBITION OF CERTAIN
TYPES OF GLASS) RULES, 1991 - JPJ

• Aduan: Penguatkuasa terima rasuah

kerana tidak ambil tindakan (saman)
• Wujud Peluang rasuah/salahguna kuasa
dalam penguatkuasaan.
• Undang-undang tidak dipinda (lapok),
tidak boleh dikuatkuasakan dan Alat
pengukur cahaya tidak diwartakan.
• Perbezaan penentuan kadar saman antara
JPJ & PDRM.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Contoh: ISU KEAHLIAN PEGAWAI
KANAN KERAJAAN DI DALAM
SESEBUAH KELAB GOLF SYARIKAT
SWASTA ATAS DASAR NOMINEE

• Wujud peluang rasuah/salahguna

kuasa
• Pegawai ada pengaruh/kedudukan
• Tiada dasar/peraturan bertulis

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Contoh: PENETAPAN KADAR SAMAN BAGI
KESALAHAN SEK. 6(1) ENAKMEN HIBURAN
DAN TEMPAT-TEMPAT HIBURAN NEGERI
SELANGOR 1995

• Wujud peluang rasuah/salahguna

kuasa
• Penompokan kuasa - Enakmen
peruntuk kuasa kepada YDP
untuk menetapkan kadar
kompaun

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Proses Kerja
Pendakwaan Kes Jabatan Kastam

PENGARAH

BILIK KERANI PEGAWAI

KEBAL REKOD PENDAKWA

PEGAWAI
PENDAKWA MAHKAMAH
Pilot project by National Centre for
Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 COMMON CORRUPTION
INDICATORS/SYMPTOMS
* lavish lifestyle - living beyond means
* unexplained sources of wealth
* unusual close relationship with clients
* unnecessary involvement in other division
* Heavy indebtedness, gambling
* refusal of suppliers/contractors to deal
with other staff
* prefer to work alone, very secretive
* unnecessarily making extra copies of
document
Pilot project by National Centre for
Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 ANTI-CORRUPTION MEASURES – Guidelines on Adequate Procedures
UK Bribery Act CISM PricewaterhouseCoopers
ISO 37001:2016 - ABMS
2010 (The 10 Anti-Corruption (The 5 Essential Elements)
(The 6 Principles) Initiatives) (2014) (The 8 ‘TRUST' Requirements) (2008)

• Top Level • Leadership • TOP LEVEL COMMITMENT • Tone at the Top

Commitment
- Top Management Leadership,
Commitment and Responsibility
• Proportionate • Code of Ethics • UNDERTAKE CONTROL • Programme Design and
Procedures • Policy Compliance MEASURES Control Activities
(Anti-Bribery • Whistle Blowing Policy - An Anti-bribery Policy, (Typical Policies & Control:
Programme – • Referral Policy Procedures and Controls - Facilitation Payments
detailed • Conflict of Interest Policy - Governing Body Oversight – - Gifts, Entertainment
policies and Compliance Function - Charitable Contributions
• Compliance Policy and
procedures) - Review, Corrective Action and - Acquisition Due
Programmes
Continual Improvement Diligence
• Corporate Social - Record Keeping
Responsibility

• Bribery Risk • Identifying Specific • RISK ASSESSMENT • Risk Assessment on

Assessment Corruption Risk Area - Due Diligence on Projects and Business Processes
• Due Diligence Business Associates

• Effective • Ethics Training, • TRAINING AND (Consistent Communication

Communicatio Education & COMMUNICATION under Tone at the Top)
ns and Communication
Training
• Monitoring and • Anti-Corruption • SYSTEMATIC REVIEW • Monitoring
Review Reporting MONITORING AND • Response & Remediation
ENFORCEMENT

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
ORGANISATION ANTI-CORRUPTION
POLICIES AND GUIDELINES ON:

• GIFT RECEIVING
• CHARITABLE CONTRIBUTIONS/ SPONSORSHIP
• FACILITATION PAYMENTS
• HOSPITALITY/ENTERTAINMENT EXPENSES
• CONFLICTS OF INTEREST
• REFERAL POLICY
 RAISING CONCERNS AND SEEKING
GUIDANCE
• Provide secure and available channels through
which employees and others able to raise
concerns and whistle-blow (without
retribution)

• Provide guidance in respect of the

interpretation of the Principles/ Code

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 CORPORATE LIABILITY FOR
CORRUPTION
Section 17(A) MACC Act 2009
(amendment 2018)

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 COST OF CORRUPTION

Siemens was accused of bribery

and other corporate
malfeasance in approximately
20 countries. Bribes were given
to win many contracts.

Siemens agreed to pay a record

$1.34 billion in fines in
December 2008 after being
investigated for serious bribery.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 COST OF CORRUPTION
Alcatel was charged with two
counts of violating the US
Foreign Corrupt Practices Act.
Three of its subsidiaries
agreed to plead guilty to one
count each of conspiracy to
violate the anti-bribery law.

Agreed to pay more than US

$137 million (RM430.4 million)
to settle US charges that it
paid millions of dollars in
bribes to foreign officials to
win business in Latin America
and Asia, US authorities.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 COST OF CORRUPTION

Alstom paid more than $75

million in bribes from 2000
to 2011 to secure $4 billion
in contracts around the
world, which led to profits
of about $300 million.
They were fined US$772
million.

In UK, they were still being

prosecuted in 2017 for
bribes paid more than ten
years ago.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A(1) MACC Act 2009 (amendment 2018)

THE ‘OFFENCE’
A commersial organization commits an offence if a
person associated with the commercial organization
corruptly gives, agrees to give, promises or offers to
any person any gratification whether for the benefit
of that person or another person with intent –
a) To obtain or retain business for
the commercial organization; or
b) To obtain or retain an advantage
in the conduct of business for
the commercial organization.
Pilot project by National Centre for
Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A(6) & (7) MACC Act 2009 (amendment 2018)

ASSOCIATED PERSON
Section 17(6)
For the purposes of this section, a person is associated with the
commercial organization if he is a director, partner or an
employee of the commercial organization or he is a person who
performs services for or on behalf of the commercial
organization.

Section 17(7)
The question whether or not a person performs services for or
on behalf of the commercial organization shall be determined
by reference to all the relevant circumstances and not merely
by reference to the nature of the relationship between him and
the commercial organization.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A MACC Act 2009

THE ‘PROVING’
Prosecution side –
• THE ACT OF BRIBERY WAS COMMITTED TO THE
CRIMINAL STANDARD
• THE PERSON WAS ASSOCIATED WITH THE
CORPORATION
• THE PERSON INTENDED TO OBTAIN OR RETAIN
BUSINESS FOR THE CORPORATION; OR OBTAIN OR
RETAIN AN ADVANTAGE IN THE CONDUCT OF THE
BUSINESS OF THE CORPORATION

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A MACC Act 2009

THE ‘CONVICTION’

The conviction and sentencing

would not be for the offence of
bribery but for the failure to
prevent the offence.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A MACC Act 2009

THE ‘PENALTIES’

Section 17A(2)
Any commercial organization who commits an
offence under this Section shall on conviction be
liable to a fine of not less that ten times the sum or
value of the gratification which is the subject
matter of the offence, where such gratification is
capable of being valued or is of pecuniary nature, or
one million ringgit, whichever is the higbher, or to
imprisonment for a term not exceeding 20 years or
to both.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A MACC Act 2009

THE ‘DEFENCE’

Section 17(4)
If a commercial organization is charged for
the offence referred to in sub-section 1, it is
a defence for the commercial organization to
prove that the commercial orgnization had in
place adequate procedures to prevent
persons associated with the commercial
organization from undertaking such conduct.

Pilot project by National Centre for

Implemented by
Governance, Integrity
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 Corporate Liability For Corruption
– Sec 17A(5) MACC Act 2009
WHAT ARE ADEQUATE PROCEDURES?

Pilot project by National Centre for

Implemented by
Governance, Integrity
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 Corporate Liability For Corruption
– Sec 17A MACC Act 2009
LIABILITY OF MANAGERS AND DIRECTORS

• Section 17A had another layer of liability

which is not found under the UK Bribery Act
2010.
• Under Section 17A(3), if the commercial
organization is found liable because it does
not have adequate procedures, the
management of the commercial organization
including directors and managers may also be
found individually liable forn the offence
committed by the commercial organization.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption
– Sec 17A MACC Act 2009
SECTION 17A(3)

Where an offence is committed by a commercial

organization, a person –
a) Who is its director, controller, officer or partner
b) Who is concerned in the management of its affair,
At the same time of the commission of the offence, is
deemed to have committed that offence UNLESS that
person proves that the offence was committed without his
consent or connivance and that he exercised due diligence
to prevent the commission of the offence as he ought to
have exercised, having regard to the nature of his function
in that capacity and to the circumstances.

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 Corporate Liability For Corruption

DEFFERED PROSECUTION AGREEMENTS

(DPA) – Settlement Agreements

- To avoid bad publicity

- Affects company’s reputation
- Impacts on the company’s ability to win
future works/contracts
- Lengthy period of court trials
- To avoid additional expenses

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)
 “Leadership is not rank,
privileges, titles or money;
it is responsibility.”
[Peter Drucker]

THANK YOU
LETS MAKE A DIFFERENCE:
FIGHT CORRUPTION

Pilot project by National Centre for

Implemented by
Governance, Integrity
and Anti-Corruption (GIACC)