Gambling in Malaysia is defined as gambling on a public place or on a particular gambling house, and all the crimes carried out on the people there are considered unlawful. There are three categories of gambling that are illegal in Malaysia: horse racing, badminton, and sports betting. Malay gambling also includes horse racing. Badminton is quite popular in Malaysia, particularly because it is very easy to organise. The only qualifications required for badminton are the age of the player, his/her nationality (countries are very strict about this), and a certificate from a recognised body. Sports betting, on the other hand, is widely accepted in Malaysia as well as in other countries, although it is illegal to operate a sportsbook in Malaysia without a special licence.
The law on gambling is fairly clear, but there are many grey areas. The Law Reform Commission of Malaysia has drafted a new Criminal Law Act that provides a rather complex set of circumstances surrounding criminal offenses, with some aspects relating to gambling being moved to a new Act. This may well be welcomed by the Malaysian public as it would address some of the longstanding issues surrounding gambling, such as the lack of effective criminal laws covering it, the wide-spread and systematic practice of undeclared gambling by foreign nationals in Malaysia, and the porous nature of the country’s borders. However, the reluctance to address the legal issues surrounding Malaysian gambling shows a lack of will to address the problem both domestically and abroad. It is little wonder that both government and non-government agencies have failed to establish the basic principles that would prevent and curtail malpractice, corruption and mismanagement of funds.
Beyond the lack of will to address malpractices within the legal sector, the legal and the illegal gambling arenas are both experiencing similar deficiencies in the application of regulation and supervision. The lack of consistency in application of the law across all sectors of society is alarming. For example, it is very easy for an individual to become a legal gambling enterprise in the country, open a bank account and operate a gambling website from his residence in Malaysia. The laws do not apply to such ventures because they are conducting the business outside the country. Similarly, the banking laws of Malaysia are almost toothless and have been found to be ineffective in stopping or reducing the abuses against the residents of Malayang, particularly the ethnic Chinese. Officialdom is also found to be lax in dealing with cases of criminal financial misconduct by Malaysian nationals.
As a result, many crimes that would have been illegal in Malaysia have been allowed to go unchecked. In addition, malpractices that would have been illegal in Malaysia have gone unpunished, allowing such offshore operators to continue their unlawful activities. A report issued by the home ministry in January 2021 highlighted that there were still several unresolved problems, such as those regarding counterfeit gambling machines and other money laundering schemes. One of the biggest concerns was the “double income” theory, which has been used by some operators to earn two gambling incomes by simultaneously operating a home-based casino online. The home ministry has been repeatedly requested by the operators to curb this double income scheme, which has no application in Malaysia.
The lack of effective enforcement measures has left the online gambling industry in a lurch, as the only way to halt the advances of malpractice and corruption is for the government to step in and impose a set of legislative reforms that would strengthen the regulatory bodies and establish a more tolerant attitude on the part of the public. This initiative has so far remained a pipe dream, as the home ministry has consistently failed to propose any significant change to the existing anti-gambling laws. The home ministry’s failure to curb the illegal operators may be due to the fact that it is more interested in maintaining the status quo rather than pursuing a systematic approach to stamping out the illegal gambling industry.
There is also the likelihood that despite all the legislation and recommendations made by the home ministry against gambling, the problem will simply grow worse. There are several reasons for this. The first and perhaps most fundamental reason is that authorities have not seriously tackled the issue of identifying and apprehending illegal gambling dens. It is believed that there are hundreds of such gambling venues in Malaysia, and the numbers are growing seemingly every week. In some areas, there are already too many gambling facilities.
The second reason why Malaysian law enforcement agencies have not been successful in stopping malpractices at gambling dens is that they are poorly equipped to deal with operations of this scale. The Malaysian National Police has limited resources, especially compared to the size of its enforcement wing. Its officials are often poorly trained in law enforcement, or too weak in motivation to do their job adequately. They seem incapable of coordinating between different agencies that make up the national police force, or of even realizing the extent of the problem within their jurisdiction. These deficiencies have helped fuel the rise of illegal gambling establishments in recent years. Most of these gambling dens have their operators based in countries other than Malaysia, making the law enforcement effort irrelevant and disinterested in stopping malpractice at gambling dens.
The third major obstacle to the success of law enforcement in Malaysia against online gambling is lack of resources. The majority of local law enforcement officials are not well versed in internet or computer law, making their efforts futile against operators of illegal gambling sites. The government may be able to support prosecution of operators of illegal gambling sites in other states where the government has influence over the operators of legitimate sites, but it has no influence whatsoever over persons operating gambling sites based in Malaysia. It is very unlikely that the Malaysian government can arrest more than a few operators of online gambling sites in a country that boasts of being the world’s biggest online casino destination.
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