Don’t take new MACC Act provision lightly, bosses told

From June 1, companies and not just people can be prosecuted for corruption.

PETALING JAYA: Transparency International Malaysia has cautioned company directors and managers against making light of the imminent enforcement of the MACC Act’s provision on corporate liability.

The watchdog’s president, Muhammad Mohan, said company leaders should no longer think that inducements such as sponsored trips or promises of sponsorship in exchange for a piece of business would be legally acceptable.

“The fine is no small amount,” he said.

Under the provision, which will be enforced on June 1, the guilty party is liable to a fine not less than 10 times the value of the gratification or RM1 million, whichever is higher, or imprisonment of up to 20 years or both a fine and a jail term.

Even if the bribing is done by an employee, a company or the company as well as its directors, managers, partners or associates can be liable.

Speaking to FMT, Mohan gave the example of an executive trying to secure a project for his company by offering the awarding party’s procurement manager a favour.

“In the past, only that individual will be charged with corruption if he is caught. But from June 1, the company and the top level will be liable for a fine or jail term or both.”

He said some bosses might think the provision was unfair to them because there could be cases in which they were not aware that their subordinates were engaged in corrupt practices.

This was why it was important for companies of all sizes to mitigate risks by adopting the government’s guidelines in ensuring adequate procedures are in place.

Such measures include risk assessments, training, controls to prevent bribery, systematic reviews of anti-corruption initiatives as well as the monitoring and enforcement of such initiatives.

Mohan said the top level should be able to show they are implementing the measures.

“They are not required by law to do so, but it is in their interest,” he said. “Should an employee be caught for corruption, they will need to show that they have done everything they could to prevent it.

“For example, companies should have a policy even on festive gifts, declaring them and rejecting gifts worth above a reasonable amount.”

Some companies, he noted, were going a step further by implementing the Anti-Bribery Management System (ISO 37001).

He said the success of the provision would be in enforcement and he urged those with information on corruption in companies to lodge reports with the MACC.

“Those who report could be protected by the Whistleblowers Protection Act,” he added.

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