Country Reports on Terrorism 2014 - Malaysia

Overview: Both domestically and on the international stage, Malaysia's counterterrorism efforts in 2014 largely focused on mitigating the threat of the Islamic State in Iraq and the Levant (ISIL) and foreign terrorist fighters. Prime Minister Najib submitted to Parliament a White Paper on the threat of ISIL in November, which emphasized the risk of Malaysian foreign terrorist fighters returning home to destabilize the country. Malaysian authorities arrested approximately 50 suspected ISIL supporters in 2014. When he presented the White Paper to Parliament, the Prime Minister said that authorities had identified 39 Malaysians fighting with various militant groups in Syria and Iraq, 17 of whom were fighting with ISIL. The Prime Minister also announced that five Malaysian foreign fighters had returned home from Syria and Iraq, three of whom had been arrested, with police monitoring the other two.

President Obama's April visit to Malaysia resulted in the elevation of the bilateral relationship to a Comprehensive Partnership, which included efforts to strengthen security and law enforcement cooperation such as maritime and border security. With the positive developments from the summit, U.S. cooperation with Malaysia on counterterrorism and other transnational security issues continued to improve. The United States and Malaysia signed an Immigration Memorandum of Understanding in October, and a Customs Mutual Assistance Agreement in December – both of which further strengthen bilateral security cooperation.

Malaysia is not considered a terrorist safe haven, but some violent extremists have been known to operate and hide in isolated littoral areas of the Sulu/Sulawesi Seas between Malaysia, Indonesia, and the Philippines.

2014 Terrorist Incidents: Militants allegedly from the Philippines and linked to the Abu Sayyaf Group conducted four cross-border kidnapping for ransom operations in eastern Sabah, Malaysia. In April, a Chinese tourist and a Philippine hotel employee were kidnapped by armed men from a diving resort off the coast of Semporna. In May, a Chinese manager of a fish farm was kidnapped from an island near Lahad Datu; and in June, a Philippine and a Malaysian national were kidnapped from another fish farm in Kunak. In July, at a diving resort on Mabul Island, armed men killed a Royal Malaysian Police (RMP) officer and kidnapped another officer, who remained in captivity at year's end.

Legislation, Law Enforcement, and Border Security: The Security Offenses (Special Measures) Act (SOSMA), and chapters VI (Offenses Against the State) and VIa (Offenses Relating to Terrorism) of Malaysia's penal code were the primary legal tools for terrorism cases.

In January, the RMP restructured the former Special Task Force (Operations/Counterterrorism) into a new Special Branch/Counterterrorism Unit, which now has the lead role in counterterrorism efforts. Malaysian authorities made efforts to improve interagency cooperation and information sharing, including participation in regional meetings, Global Counterterrorism Forum (GCTF) regional workshops, and training conducted through Malaysia's Southeast Asia Regional Centre for Counter-Terrorism (SEARCCT), which is part of Malaysia's Ministry of Foreign Affairs.

In January, Malaysian authorities released from detention the remaining six individuals who had been held under the Internal Security Act (ISA), which was repealed in 2012 with the introduction of SOSMA. The six included three Malaysians, two Indonesians, and a Philippine citizen detained under the ISA in November 2011 for alleged membership in Darul Islam Sabah, which is linked to Jemaah Islamiya (JI).

In November, Indonesian authorities released from prison JI bomb-maker Taufik Abdul Halim, a Malaysian citizen who spent the past 12 years in jail for attempting to bomb a Jakarta shopping mall in 2001. Malaysian police monitored Taufik after his release, as he is the brother-in-law of wanted terrorist Zulkifli Abdul Khir, also known as Marwan.

In December, Malaysian authorities arrested and subsequently deported to Indonesia three men and four women intending to join ISIL in Syria. The seven Indonesians were traveling with five children.

As of year's end, the trial of al-Qa'ida operative Yazid Sufaat, who was arrested in 2013 for recruiting Malaysians to fight in Syria, had not yet begun. Sufaat was charged with inciting or promoting the commission of terrorist acts under Section 130G(a) of Malaysia's penal code. One accomplice, Muhammad Hilmi Hasim, remained in custody awaiting trial under for aiding and abetting the commission of terrorist acts. Sufaat's other accomplice, Halimah Hussein, remained at large at year's end.

The SOSMA trial of 30 suspects – 27 Philippine nationals and three Malaysians – involved in the February 2013 Lahad Datu incursion began in January and was ongoing at year's end. The suspects were on trial for harboring terrorists, membership of a terrorist group, recruiting terrorists, and waging war against the king.

Iranian citizen, and suspected member of the Iran's Revolutionary Guard Corps, Masoud Sedaghatzadeh, arrested in Malaysia in February 2012 after failed attempted bombings in Bangkok, remained in Malaysian custody. A Malaysian court had ordered Sedaghatzadeh's extradition to Thailand in 2012, but his appeal remained pending at year's end.

Malaysia has a no-fly list, but passengers are compared to that list by the immigration officer at the port of entry and the decision to deny entry is made at the airport. Malaysia does not regularly screen at immigration checkpoints through Interpol.

In July, in response to the continued threat of kidnapping for ransom and other transnational threats, the Malaysian government enacted a maritime curfew along the eastern coast of Sabah. The government extended the curfew multiple times and at year's end it was still in effect. The government also announced in July that an additional 330 police officers and 350 army personnel would be deployed to eastern Sabah to strengthen the border.

Of the approximately 50 suspected ISIL supporters Malaysian authorities arrested (not including non-Malaysian citizens who were deported), prosecutors filed charges in 22 cases. The charges included incitement, abetment, and soliciting or giving support to a terrorist organization. At least two of the individuals were charged with illegal firearms possession.

Malaysian police also arrested – and subsequently deported – 13 alleged supporters of the Liberation Tigers of Tamil Eelam (LTTE) and a Somali member of al-Shabaab. Several of the deported LTTE suspects had allegedly planned attacks against U.S. and Israeli diplomatic facilities in India. In July, the Malaysian Home Minister said that, since 2009, Malaysia had deported 67 foreigners suspected of being involved in militant activities in Malaysia and overseas.

Malaysia demonstrated its political will at the highest levels of government to confront the threat of ISIL and other terrorist groups. Malaysia's existing legal system is capable of disrupting terrorist plots before they are carried out, and before fighters travel to foreign conflicts. Malaysia has laws against conspiracy, attempt, incitement, solicitation, aiding, abetting, and promoting terrorist acts, and most of the same inchoate offenses that are prosecutable in the United States. However, as authorities were unable to file charges in roughly half of the terrorism-related arrests, a significant challenge is Malaysia's need to strengthen proactive cooperation between police and prosecutors from the outset of an investigation.

Malaysia continued to participate in the Department of State's Antiterrorism Assistance program, with programs focused on strengthening law enforcement capacity to secure Malaysia's borders from terrorist transit.

The U.S. Department of State's Export Controls and Related Border Security (EXBS) Program conducted capacity building activities for customs, police, immigration, coast guard, and strategic trade officials. EXBS also strengthened international and regional coordination of maritime security efforts. Malaysia participated in the Container Security and Megaports Initiatives, as well as the UN Office and Drugs and Crime Container Control Program.

In October, the U.S. government conducted a three-day workshop for over 60 Malaysian police and prosecutors designed to promote greater cooperation in the proactive investigation and prosecution of terrorism cases.

Countering the Financing of Terrorism: Malaysia became an official observer country of the Financial Action Task Force (FATF) in October, and has expressed interest in becoming a full member. In November, a FATF team conducted an assessment of Malaysia. Malaysia is a member of the Asia/Pacific Group on Money Laundering, a FATF-style regional body.

Malaysia has a well-developed anti-money laundering/countering the financing of terrorism (AML/CFT) framework, and a capable Financial Intelligence and Enforcement Unit within Bank Negara Malaysia, the central bank of Malaysia. Nevertheless, the ISIL White Paper noted that Malaysia was at risk of becoming a terrorist finance hub, suggesting that existing laws should be strengthened.

In August, Parliament passed an amendment to the 2001 Anti-Money Laundering, Anti-Terrorist Financing Act, which broadened the government's investigation and enforcement authority, in line with FATF standards. The amendment came into effect on September 1.

Law enforcement and customs officials are responsible for examining trade-based money laundering and invoice manipulation, and their relationship to underground finance and informal remittance systems. Malaysia took strong steps in 2014 to counter and reduce unauthorized money services businesses – including a series of raids in November.

In response to FATF's 2012 revised international standards, Malaysia's National Coordinating Committee for Countering Money Laundering assessed money laundering and terrorist financing threats facing the country. The review was completed in 2014, and Malaysia is implementing new measures to mitigate the risks identified, including intensifying joint law enforcement investigation efforts, forming dedicated AML/CFT law enforcement units, and strengthening Malaysia's AML/CFT framework.

Malaysia does not oblige non-profit organizations (NPOs) themselves to file suspicious transaction reports, but they are required to file annual financial statements that are scrutinized by the Registrar of Societies (ROS), which may file such reports. Law enforcement works with the ROS and other charity regulators to prevent misuse and terrorist financing in the NPO sector, especially in vulnerable areas like religious or charitable NPOs. ROS also conducts an annual conference for its members on the risks of terrorist financing.

For further information on money laundering and financial crimes, see the 2014 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: http://www.state.gov/j/inl/rls/nrcrpt/index.htm

Regional and International Cooperation: Malaysia actively participated in UN, ASEAN, and other regional and international forums. As part of the ASEAN Regional Forum (ARF) 2014-2015 Work Plan for Counterterrorism and Transnational Crime, Malaysia is one of the lead countries for two key priority areas: 1) cybersecurity and terrorists' use of the internet, and 2) counter-radicalization. In March, Malaysia hosted an ARF workshop on cyber-confidence building measures.

The SEARCCT hosted 17 training events in 2014, including seminars on crisis management, transportation security, and chemical/biological/radiological/nuclear response training. The U.S. government supported three SEARCCT events in 2014, including programs on countering the financing of terrorism and countering violent extremism. Malaysian officials participated in several GCTF events, including workshops on strengthening the judiciary, detention and reintegration of terrorist prisoners, and foreign terrorist fighters.

A team from the U.S. Department of State's Rewards for Justice Program visited Kuala Lumpur in November to consult with Malaysian officials on establishing a similar program.

In 2014, Malaysia continued to facilitate peace talks between the Philippine government and the Moro Islamic Liberation Front. Malaysia's mediation efforts helped lead to the Philippine government and the Moro Islamic Liberation Front signing the Comprehensive Agreement on the Bangsamoro in May.

Malaysia considers ISIL a terrorist organization and was a co-sponsor of UNSCR 2178. In addition to robust law enforcement activity, Malaysia hosted several regional capacity building efforts to strengthen anti-ISIL efforts in Southeast Asia.

Countering Radicalization to Violence and Violent Extremism: In October, Malaysia's Islamic Development Authority (JAKIM), which oversees the majority of the country's mosques and Islamic scholars, issued a fatwa against ISIL that labeled the organization illegal under Islamic law and declared that followers that died fighting with ISIL were not "martyrs." JAKIM promoted anti-ISIL messaging through its Friday sermons and sought to educate Malaysia's Muslims on the peaceful meaning of jihad.

SEARCCT conducted several regional programs on countering violent extremism and the dynamics of youth and terrorism. These programs included a January workshop on promoting community-oriented policing to counter violent extremism, and a November program that brought together government officials, civil society leaders, journalists, and representatives of the private sector to develop effective strategies to counter violent extremist narratives online.

The Global Movement of Moderates (GMM), a Malaysian-based organization founded by Prime Minister Najib, conducted several countering violent extremism programs, including a public forum on youth and terrorism. In September, GMM formed a task force in partnership with the Malaysian Islamic Youth Movement focused on countering violent extremist ideologies.