Bank Negara Malaysia (BNM) has imposed a total fine of RM7.29 million on three financial institutions, namely Bank Islam Malaysia Bhd (Bank Islam), Bank Rakyat and Bank Simpanan Nasional (BSN) following serious violations of the country's technology and financial regulations.
Of the three institutions, Bank Islam received the highest penalty of RM3.45 million for two main offenses, namely prolonged service system disruptions and failure to comply with the requirements for screening restrictions on customers.
Repeated system disruptions involving internet banking services, debit cards and online transactions occurred throughout the period from 1 June 2023 to 31 December 2024, thus exceeding the maximum disruption limit set by BNM.
More worryingly, an on-site inspection by BNM also revealed weaknesses in the screening process of Bank Islam's customers against a list of domestic entities suspected of being involved in money laundering and terrorist financing activities.
Bank Islam was also reported to be late in submitting information regarding the ownership of funds belonging to one of the listed entities.
According to BNM's confirmation, the penalty against Bank Islam was paid in May and June.
Meanwhile, Bank Rakyat was fined RM2.85 million, while BSN was fined RM995,000. Both institutions were fined for repeated system disruptions throughout 2023 to 2024 which also affected the operation of ATM machines as well as debit and credit card systems.
BNM in its statement stressed that it would not compromise with any financial institution that failed to meet regulatory standards, especially in terms of system stability and legal compliance.
