KUALA LUMPUR (Jan 24): Bank Negara Malaysia (BNM) said it has imposed an administrative monetary penalty of RM1.4 million on a financial institution for failing to notify the central bank of a significant audit finding in relation to its dealers’ misconduct.

In a statement today, it said the misconduct involved the fixing of the USD/RM exchange rate.

However, the financial institution wasn’t named.

“The financial institution has been strongly censured and issued with an order to address the shortcomings in internal controls to ensure timely notification of material findings and review existing internal policies, procedures and practices as well as to put in place robust surveillance mechanisms to prevent market abuse behaviour.

“These will be complemented by periodic compliance and audit reviews. The financial institution has given its full commitment to rectify these shortcomings and prevent recurrence of such breaches,” said BNM.

Meanwhile, the central bank reminded all financial institutions that money and foreign exchange market manipulation activities are prohibited under the Financial Services Act 2013 (FSA), adding that institutions that are aware of such findings are required to notify BNM as per the requirements of the FSA.

“BNM continues to closely monitor market activities in ensuring market participants are not involved in any money and foreign exchange market manipulation activities. It is the responsibility of the bank in carrying out its mandate under the law to ensure that public and genuine investors’ interests are protected at all times,” it said.