Bank Negara Malaysia (BNM) had, on 18 November 2024, imposed a total compound^[1] of RM875,000 on AmBank (M) Berhad (AmBank) for failure to comply with the Direction to Financial Institution, issued pursuant to section 214(6) of the Financial Services Act 2013 (FSA). AmBank has failed to sight BNM’s approval before facilitating two investment transactions in foreign currency assets by a resident individual with domestic ringgit borrowing, in breach of section 214(6) of the FSA.

Under the Foreign Exchange Policy (FEP) Direction to Financial Institutions, financial institutions are required to have in place and implement internal controls and procedures to ensure compliance by the financial institution and their clients with any direction, approval, requirement, restriction and condition issued by BNM under section 214 of the FSA. This includes to sight a written approval from BNM before facilitating or giving effect to any transaction requiring such approval.

The non-compliance resulted from gaps observed in AmBank’s internal policies and procedures. AmBank has taken appropriate measures to strengthen its internal practices and procedures pertaining to foreign exchange policy, including providing appropriate training for staff and improving internal information flow to ensure compliance with applicable domestic laws and regulations.

In deciding the imposition of the compound, BNM considered the relevant aggravating and mitigating factors, including the facts of the case as well as AmBank's past non-compliance record.

AmBank paid a total of RM875,000 for the imposed compound on 6 December 2024. The enforcement action taken is in line with the approach and processes outlined in the Enforcement Approach document.

BNM wishes to emphasise that financial institutions, including members of the public to ensure compliance with relevant FEP rules when engaging in such transactions, including obtaining written approval from BNM, where applicable. Additionally, financial institutions are reminded to appropriately advise customers of these requirements accordingly. More information on FEP rules can be found in the Foreign Exchange Policy.

^[1] BNM imposed compound pursuant to section 253 of the FSA.