BNM governor warns of AI-assisted financial crime

Bank Negara Malaysia's Governor Abdul Rasheed Ghaffour warned that artificial intelligence (AI) is being exploited by criminals to carry out increasingly sophisticated financial frauds. Over the past five years, authorities have recovered over RM37 billion in stolen assets. However, Ghaffour noted that AI has made it easier for criminals to engage in social engineering and manipulate victims. He emphasized that criminals are now 4.5 times more profitable when employing AI-enabled fraud compared to traditional methods.

Ghaffour highlighted that about 95% of online fraud cases involve victims being tricked into transferring funds. To counter these threats, he stressed the need for an "arms race" between law enforcement and criminals, with a focus on automating detection capabilities. At the opening of a conference on financial crime prevention, Rasheed reported that the financial sector had prevented fraudulent transactions worth RM1.9 billion in the first half of the year, surpassing the RM1.2 billion prevented in all of 2025.

Additionally, more than RM37 billion in assets were recovered over the past five years, and complex financial crime cases involving multiple agencies have been investigated and prosecuted.

The Malaysian government's efforts in combating financial crime over the past 25 years have been built on strong laws, institutions, and a deeper understanding of risk and supervisory approaches. Recent amendments to key anti-financial crime laws, along with enhanced coordination and intelligence-sharing platforms, have strengthened the country's ability to investigate, prosecute, and recover illicit assets.

Malaysia now boasts over 27,000 financial and non-financial reporting institutions supported by technology-enabled supervision, demonstrating a collective response to the growing financial crime threat.