Business

Saturday November 7, 2009

Lofsa will ensure businesses comply with regulations


KUALA LUMPUR: The Labuan Offshore Financial Services Authority (Lofsa) says it will ensure that financial businesses in Labuan continue to comply fully with international regulatory requirements.

It would take forceful action against any breach and non-compliance, it said in a statement yesterday.

The Labuan International Business and Financial Centre (Labuan IBFC) is well-regulated and the prudential practices are on par with international standards, Lofsa said. It continues to cater to legitimate and sound businesses.

The strict regulatory and supervisory regime, including the prohibition of cash transactions in the IBFC, the application of anti-money laundering rules and procedures on the financial institutions in Labuan are designed to preserve the centre’s integrity and reputation, it added.

It issued the statement following a move by the US Treasury Department on Thursday which announced sanctions against First East Export Bank PLC, the Labuan subsidiary of Iran’s Bank Mellat, accusing it of helping to finance the proliferation of weapons of mass destruction.

The executive order authorising the move freezes the assets of designated proliferators of weapons of mass destruction and their supporters and prohibits US persons from engaging in any transaction with them, the Treasury Department said.

Separately, Bank Negara governor Tan Sri Zeti Akhtar Aziz said forceful action would be taken immediately if there was any contravention of rules and regulations.

“Lofsa is a well regulated financial centre. So we have confidence, and if we uncover anything that is not compliant, then forceful action will take place immediately,” she told reporters when asked to comment on the issue after attending the Budget 2010 implementation meeting in Putrajaya.

She said Malaysia had followed the rules of the United Nations and also monitored very closely Lofsa to ensure that there was no contravention to the rules and regulations.

“Our oversight and surveillance are very stringent ... because we value the reputation of Lofsa as a business financial centre conducting legitimate business,” she said. – Bernama

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