Land Banking: Malaysia raids Walton
When World Money Laundering Report wrote about Land Banking in Volume 8 Number 8, reference was made to a number of practices that land banking companies use to avoid falling into the regulatory sector, and explaining the way in which the UK's FSA had brought the investment schemes within their ambit. Now Malaysia has raided the offices of one of the land banking companies operating in the country.
The official statement from Bank Negara Malaysia (the central bank which is also the primary regulator for the financial sector) says, simply
"On 5 March 2009, Bank Negara Malaysia raided Walton International Property Group (M) Sdn Bhd under the Exchange Control Act (ECA) 1953. The raids were simultaneously conducted at the premises of the company in Kuala Lumpur (W. Persekutuan), Kota Kinabalu (Sabah) and Kuching ( Sarawak ) following complaints received from members of the public. Relevant documents of the company were seized for purpose of the investigation.
"Members of the public are advised to be cautious of this type of land banking schemes promoted by the company. Any elements of deposit-taking activities and public offerings such as ‘interest schemes' or investment in real estates schemes (better known as ‘real estate investment trusts' - REITs) should be referred to the appropriate authorities."
BNM also warned that any transfer of funds overseas should be made using "lawful remittance channels," a nod at the risk that land banking is in most jurisdictions outside the regulatory sector for counter-money laundering purposes. Lawful transfers would fall within the currency transaction reporting requirements.
Walton's Asia regional chief operating officer Kent Britton issued a statement saying "“Walton operates to the highest ethical and business standards in Malaysia and around the world" and “Walton wishes to assure valued clients, employees, partners and the Malaysian public at large that it is co-operating fully with Bank Negara to resolve this matter as quickly as possible."
“In Malaysia, as elsewhere, we are committed to positive relationships with our valued clients and with the citizens and governments of the countries in which we do business,” Britton said, adding "We are fully open and transparent in our professional relationships with regulatory authorities, and responsive to requests for information and cooperation. Walton does not distribute REITs, nor offers deposit-taking or interest schemes."
Walton operates in seven countries dealing in land in North America and Canada.
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