KUALA LUMPUR – Despite severe penalties, including fines up to five times the amount gained from corrupt activities or imprisonment, corruption remains prevalent among offenders who believe they will not be apprehended.
Datuk Seri Norazlan Mohd Razali, deputy chief commissioner for prevention at the Malaysian Anti-Corruption Commission (MACC), said that this belief is commonly observed during corruption investigations.
He explained that this perception arises because, in 99% of cases, witnesses are hesitant to come forward and report corrupt activities.
“The authorities require hard evidence from the witnesses when it comes to matters pertaining to corruption, especially when it comes to contract procurement.
“This is the common challenge faced by the authorities when they are investigating corruption, (which would then empower) those who commit such offences to think that they will never get caught, and that nobody would lodge a report against them,” he said when addressing the crowd at the 10th National Procurement Conference today.
Norazlan participated as a panellist in a discussion focusing on regulatory dynamics in procurement, enhancing corruption prevention, advancements in e-invoicing, and compliance with anti-money laundering (AMLA) regulations.
Other panellists included BDO Malaysia executive director for advisory Sanjay Sidhu and Sime Darby Property Bhd’s chief risk, integrity and compliance officer Tang Ai Leen.
The discussion was moderated by the Malaysian Institute of Corporate Governance deputy chair Datin Yasmin Ahmad Merican.
Sanjay agreed with Norazlan’s assertions, noting that the current legal system, which permits the disgorgement of profits from corrupt practices, contributes to the issue.
“There is a disgorgement of profits that you earned from corrupt practices, which the amounts are over and beyond the amount of fine (once you’re convicted).
“But the interesting thing is that our legal system, especially in our AMLA-related law, allows such disgorgement. I have yet to see the Attorney-General’s Chambers trigger the proceeds (obtained) from unlawful activities in tandem with the MACC offences, as practised by any other countries.”
Earlier in his speech, Norazlan highlighted that the MACC had received approximately 70% of complaints related to public procurement issues as of July this year, up from 67% in 2022 and 69% last year.
He noted that many corruption cases investigated in public procurement involve abuse of power, demanding or receiving bribes, and approving claims for incomplete work or undelivered supplies.
“These practices drain funds allocated for public goods and services through overpriced contracts, compromise quality through inferior materials and substandard construction, and lead to unreliable services, posing risks to public welfare and safety.
“The negative economic and social impacts of corruption, such as wasted resources, inefficiency, and missed opportunities, far outweigh any benefits gained. This ultimately undermines public trust in government and erodes the integrity needed to promote the public good,” he said.
Norazlan added that Malaysia still has room for improvement in implementing preventative governance measures to ensure transparent procurement processes with clear accountability, despite existing legal and regulatory frameworks like the Finance Ministry’s circulars on integrity in public procurement and disciplinary actions against companies involved in public procurement.
“Since many processes are currently managed by humans, we need technology to regulate human behaviour and reduce opportunities for corruption.
“E-procurement systems like e-Perolehan offer a solution by streamlining procurement processes and catalysing innovation, revolutionising procurement practices with technologies like artificial intelligence, blockchain and cloud computing, resulting in a more efficient procurement process.
“The introduction of e-invoicing by the Inland Revenue Board could also help eliminate invoice forgery and other fraudulent business transactions in procurement,” he said.
The conference, themed “Revolutionising Governance Through Digital Procurement”, aims to explore the future of procurement with a focus on governance, integrity and combating corruption. – August 8, 2024