The definition of 'unlawful activities' as stated in the proposed Anti-Money Laundering Bill must be widened to include gambling activities, said an opposition member of parliament today.

While debating the proposed bill, Husam Musa, the PAS MP for Kubang Kerian, said money launderers conveniently use gambling as a modus operandi to justify their activities.

"This is so because gambling is legal in this country and money obtained by gambling is simply a sandiwara to justify money laundering," he said.

"This will make this Act (if it is passed) uneffective because it does not thoroughly cover the scope of unlawful activities," he added.

The proposed bill is to provide an Act for the offence of money laundering, the measures to be taken for the prevention of money laundering and to provide for the forfeiture of property derived from or involved in money laundering, and for other related matters.

'Unlawful activities' are those related, directly or indirectly, to any serious offence or any foreign serious offence.

Husam said money laundering is a crime driven by any activity of a criminal nature such as smuggling, drug peddling, prostitution and corruption, which are normal criminal activities already covered by other laws.

Three steps

He said there were three steps to money laundering; first, there is placement - where money launderers can place their money either in a bank or on the gambling table.

"If the money launder places his money on the gambling table, he cannot be detected because gambling is not illegal unless a thorough investigation is conducted into the origins of his money (where the money was obtained) but this will be a very complicated process," said Husam.

The second step to money laundering, he continued, is layering, where the money is being used to invest or to buy assets, bonds and travellers cheques, which are currently considered 'semi-lawful (semi-halal)'activities.

The third step, he added, is the integration process; at this stage, the money is entered into the launderer's bank account where the money is considered 'halal' because it is seen to have been obtained by lawful means such as businesses.

"These three steps are already taken into account in the bill but the initial activity of obtaining wealth through illegal means are covered by other Acts," he said.

If the enforcement of the law is weak, many money launderers can get away with the crime because their wealth can be justified by going to gambling dens, or doing business in exclusive gambling clubs instead of going to the bank.

Scot-free

Husam pointed out a few locations where such gambling activities took place. He named an Information and Communications Technology (ICT) gambling club called the Atlantic Marketing Sdn Bhd, which conducts Internet gambling business.

The company is registered overseas, somewhere in the West Indies, but the business operation is in Kuala Lumpur, conducted by a Malaysian who resides in the country, he said.

There are private rooms for club members to gamble at Berjaya Plaza in Jalan Imbi, KL, Tai Tong Restaurant in Jalan Bukit Bintang, KL, and another premise in Petaling Jaya section 20/1 which is headquartered in Wisma Dijaya in PJ, he added.

"This is so tiring; we can debate this bill forever, but money laundering will continue to take place through gambling activities," said Husam.

"I do not want to suggest what to do here but I do want to point out that there are many ways this crime can get away scot-free," he added.

No grey area

He said the government itself has bought shares in gambling companies, according to its yearly Financial Report.

"The first moral step to take is to withdraw participation in such companies. Why do we have to think or discuss this through so many times? Even the religious council (majlis fatwa) has not [seen the need to discuss] this issue," Husam said.

"In Islam, such matters are very clear, what is halal is halal and what is haram is haram. Do not say this is a grey area. What is haram, we have to fight, what is halal, we have to develop," he added.

He said business is halal while gambling is haram and the rakyat should be told through the media that gambling activities are wrong.

"If we can have laws for money laundering, why not have laws to curb (a crime) more obvious but considered lawful in the eyes of the law?" queried Husam.

Finance Ministry Deputy Minister Shafie Mohd Saleh in his reply said the lawfulness of gambling activities depended on whether a company is licensed or not.