Country Reports on Terrorism 2013 - Malaysia

Overview: Among Malaysia's most significant counterterrorism developments in 2013 was the arrest of al-Qa'ida operative Yazid Sufaat, the first person charged with terrorism offenses in Malaysia's criminal courts under the Security Offenses (Special Measures) Act of 2012 (SOSMA). Previously, Malaysia had detained suspected terrorists without trial under Internal Security Act (ISA), which was repealed with the passage of SOSMA. United States cooperation with Malaysia on counterterrorism and other transnational security issues continued to improve.

Malaysia remained vulnerable to terrorist activity and was likely used as a transit and meeting site for terrorists. 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.

Malaysian authorities cooperated closely with the international community on counterterrorism efforts, and regularly participated in capacity building training programs.

2013 Terrorist Incidents: Malaysian officials described a February/March incursion by armed insurgents into the Lahad Datu region of eastern Sabah as a terrorist attack. On February 11, approximately 250 armed insurgents, calling themselves the "Royal Security Forces of the Sultanate of Sulu and North Borneo", invaded the Lahad Datu region asserting a claim to the territory. Malaysian security forces engaged in negotiations with the insurgents in an attempt to end the incursion peacefully, and the governments of Malaysia and the Philippines remained in contact at senior levels. However, after several weeks of negotiations, fighting broke out on March 1 that resulted in the deaths of nine Malaysian police officers, six civilians, and 72 insurgents. On March 5, Malaysian authorities launched additional security operations. Of the 103 detainees resulting from those operations, 30 were eventually charged under Malaysia's penal code and SOSMA authority for harboring terrorists (Section 130K), membership of a terrorist group (Section 130K(a)), recruiting terrorists (Section 130E), and waging war against the king (Section 121). These individuals were awaiting trial at year's end. The other suspects were deported, transferred to immigration holds, or released within the 28-day period mandated by the SOSMA. In August, a 61-year-old veteran of the Royal Malaysia Police Special Branch unit was sentenced to seven years in prison under the SOSMA for withholding information linked to the Lahad Datu incursion.

On November 15, gunmen, allegedly from the Philippines and linked to the Abu Sayyaf Group, raided a resort on Pom Pom Island off the eastern coast of Sabah, killing a tourist from Taiwan and taking his wife hostage. On December 20, Philippine authorities recovered her in a forest near the village of Talipao on the island of Jolo. Some media reports indicated she was released in exchange for a ransom payment. On December 2, Royal Malaysia Police announced the arrest of two Filipino suspects in Semporna, eastern Sabah, allegedly linked to the attack.

Legislation, Law Enforcement, and Border Security: The Royal Malaysia Police Special Task Force (Operations/Counterterrorism) has the lead counterterrorism role. Malaysia's law enforcement capacity is adequate. Malaysian authorities have made efforts to improve inter-agency cooperation and information sharing. This includes participation in regional meetings, Global Counterterrorism Forum (GCTF) workshops, and training conducted through Malaysia's Southeast Asia Regional Center for Counterterrorism (SEARCCT).

Malaysian authorities, including the Attorney General's Chambers, viewed Yazid Sufaat's case as an important barometer for the application of SOSMA to successfully prosecute suspected terrorists. Sufaat, who was originally detained in December 2001 under the ISA and held for seven years for connections with al-Qa'ida (AQ), was arrested on February 3 under SOSMA, along with alleged accomplices Halimah Hussein and Muhammad Hilmi Hasim. Sufaat, an alleged former bioweapons expert for AQ, whom the 9/11 Commission Report linked to the September 11 attacks, was charged with inciting or promoting the commission of terrorist acts under Section 130G(a) of Malaysia's penal code. Hussein and Hasim were charged under Section 130G(a) with aiding and abetting Sufaat to promote the commission of terrorist acts and Section 109. On May 20, the Malaysian High Court dismissed the charges on constitutional grounds and released all three. One week after the judicial dismissal, authorities rearrested Sufaat and Hasim on new charges relating to the same criminal conduct. Halimah Hussein fled and at year's end she remained a fugitive, despite multiple Malaysian operations to find her. On June 18, an appellate court overturned the original High Court dismissal, and reinstated the original charges. At year's end, Sufaat and Hasim remained in custody, but their trials had not yet started.

In November, in cooperation with Indonesian authorities, Royal Malaysia Police captured convicted terrorist Fadli Sadama, who escaped from Tanjung Gusta Penitentiary in Medan, Indonesia in mid-July. Malaysian authorities transferred Sadama to Indonesian custody shortly after his arrest.

Iranian citizen Masoud Sedaghatzadeh, arrested in Malaysia in February 2012 after fleeing failed 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 continued to implement a fingerprint biometrics system at all ports of entry. Immigration authorities announced in December that Malaysia would implement an Advance Passenger Screening System by June 2014, including a no-fly list to prevent suspected terrorists and transnational criminals from entering or transiting the country. Malaysia has liberal visa requirements and does not require an entry visa for citizens of many countries. In October 2013, Malaysia announced it would reduce the validity of visas on arrival for Iranian tourists from 90 days to 14 days.

In response to the aforementioned Lahad Datu incursion, the Malaysian government declared the entire eastern portion of Sabah, consisting of a 1700 kilometer coastline from Kudat in the north to Tawau near the Indonesian border, as the Eastern Sabah Security Zone. In March the government formed the Eastern Sabah Security Command (ESSCOM), a civilian-led entity tasked with coordinating the security efforts of 64 military, police, and civilian agencies.

Malaysia continued to participate in the U.S. Department of State's Antiterrorism Assistance (ATA) program. ATA assistance focused on building Malaysian law enforcement capacity to secure Malaysia's borders, including air and land points of entry, from terrorist transit. Training included a range of border control instruction, including airport security and fraudulent document recognition. Malaysia also participated in the Container Security and Megaports Initiatives.

The Malaysian Attorney General led a delegation of senior law enforcement and prosecutorial officials on a State Department and Justice Department-funded study tour to the United States which focused on land border and port security, and inter-agency law enforcement task force operations. The State Department's Export Control and Border Security (EXBS) program and the Department of Homeland Security also provided document analysis training to Malaysian authorities.

Countering the Financing of Terrorism: Malaysia is a member of the Asia/Pacific Group on Money Laundering, a Financial Action Task Force-style regional body. Malaysia's geography and location make it vulnerable to exploitation by illicit actors. However, Malaysia has a well-developed anti-money laundering/countering the financing of terrorism (AML/CFT) framework. 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.

In response to FATF's 2012 revised international standards, Malaysia undertook an extensive review of its national AML/CFT framework through the National Coordinating Committee for Countering Money Laundering (NCC). The review, which was ongoing at year's end, assessed the Anti-Money Laundering and Antiterrorism Financing Act of 2001, as well as analyzed strengthening the NCC as a national body for formulating AML/CFT policy.

In September and October, the Central Bank of Malaysia issued five new AML/CFT guidelines, including more stringent measures to deal with high-risk jurisdictions and enhanced requirements to undertake risk assessment.

In October, Malaysia's Compliance Officers' Networking Group organized the fifth International Conference on Financial Crime and Terrorism Financing, a two-day event focusing on countering terrorist finance and anti-money laundering. Over 500 people attended the event, including a speaker from the FBI.

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 ASEAN and APEC forums. In June, Malaysia hosted an APEC Counterterrorism Task Force workshop on major events security. Malaysian officials actively participated in GCTF workshops, including training activities on prisoner rehabilitation, international joint investigations, judicial best practices for handling counterterrorism cases, and assistance to victims of terrorist attacks. Malaysian law enforcement officials routinely met with regional counterparts to discuss counterterrorism issues at meetings such as the ASEAN Senior Officials Meeting on Transnational Crime in Vietnam in June.

SEARCCT, which falls under the Ministry of Foreign Affairs, hosted 17 training events, including seminars on countering violent extremism; managing terrorist inmates; cybercrime links with terrorism; and chemical/biological/radiological/nuclear response training.

Malaysia continued to facilitate peace talks between the Philippine government and the Moro Islamic Liberation Front (MILF). In December the Philippine government and MILF representatives signed the power-sharing annex to the Framework Agreement on the Bangsamoro in Kuala Lumpur, an important step toward a final peace agreement to end the conflict which has killed an estimated 150,000 people.

Countering Radicalization to Violence and Violent Extremism: The Prisons Department of Malaysia implemented a three-phased approach to de-radicalizing violent extremist inmates. The first phase includes disciplinary measures. The second focuses on counseling, religious training, and behavioral improvement. The final phase includes job skills development and vocational training to facilitate reintegration into society, and provides prisoners with a modest income for work performed while incarcerated. Authorities also allowed NGOs and religious organizations to engage with prisoners. Malaysian prison officials participated in several GCTF workshops focused on countering violent extremism and the role of religious scholars in de-radicalization.

Authorities worked with religious and social counselors, as well as community leaders and family members, to help released ISA detainees reintegrate into society. Some Malaysian police participated in community engagement activities to promote trust with at-risk communities. SEARCCT, in partnership with the UN Counterterrorism Committee Executive Directorate, organized a workshop on Countering Terrorism and Violent Extremism through Community Policing.