Can banks trace scam money trails like they did for 1MDB?

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Banks' Ability to Trace Scam Money Trails Compared to 1MDB Funds Remains a Question

The capacity of banks and law enforcement agencies, specifically Bank Negara Malaysia (BNM) and the police, to trace the money trails of online scams is being questioned, particularly when contrasted with the tracing efforts in the 1MDB case. While substantial losses have been incurred by victims of online scams, the effectiveness of tracking the ultimate beneficiaries of these illicit funds is a point of concern.
Significant Financial Losses Due to Online Scams

From 2017 to 2021, Malaysia recorded a staggering RM3.3 billion in assets lost to online scams. Reports from March 10 indicated that a total of 98,607 cases of online fraud occurred nationwide during this period. The Commercial Crime Investigation Department (CCID) of Bukit Aman reported that over 30,000 individuals were detained and 25,000 charged in court for these offences. Common scam types include Macau Scams, fraudulent online sales and purchases, non-existent loan offers, and romance scams.
Questioning the Traceability of Scam Proceeds

A key concern raised is the government's approach to tracing the destination of funds lost to scams, even when those apprehended are merely "mules" or account holders rather than the orchestrators. The effectiveness of forensic audits to follow the money trail and identify the final beneficiaries of scam proceeds is being scrutinised. This raises questions about whether the same level of financial investigation success seen in cases like 1MDB can be replicated for scam-related funds.
The 1MDB Case as a Benchmark for Tracing

The 1MDB case, involving former Prime Minister Datuk Seri Najib Razak, is cited as an example where substantial funds were traced through various shell company accounts before allegedly reaching the former premier's personal account. This precedent leads to the question of why similar capabilities, particularly by institutions like Bank Negara and Bukit Aman, cannot be applied to identify the ultimate recipients of money stolen through online scams, especially when these funds are alleged to be used for further criminal activities.

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Can banks trace scam money trails like they did for 1MDB?

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