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• Banking and Financial Legalese (Terms)
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• Commodities
• Danaharta Act
• Exchange Control Rules
• Offshore Banking
• Securities

WHAT ARE THE RESTRICTIONS ON ADVERTISEMENT FOR DEPOSIT UNDER THE BANKING AND FINANCIAL INSTITUTIONS ACT 1989 ?

Section 28 of the Banking and Financial Institutions Act 1989 makes it an offense, whether dishonestly, recklessly or not, to publish any statement, promise or forecast which is

• misleading, false or deceptive or
• to conceal any material fact

in relation to deposit taking.

Any person who contravenes the above shall be guilty of an offense and shall on conviction be liable to be punished with imprisonment not exceeding 10 years or with a fine not exceeding RM$10 million or with both.

IS THERE ANY CONTROL OF ADVERTISEMENT ISSUED BY A BANK OR FINANCIAL INSTITUTION ?

Yes.

Under Section 27 of the Banking and Financial Institutions Act 1989, no person, other than a licensed bank, finance company, merchant bank or discount house, shall issue or publish an advertisement containing

• an invitation to make a deposit or enter into or offer to enter into any agreement to make a deposit or
• information which is intended or might reasonably be presumed to be intended to lead directly or indirectly to the making of a deposit.

Any person who contravenes the above shall be guilty of an offense and shall on conviction be liable to be punished with imprisonment not exceeding 5 years or with a fine not exceeding RM$5 million or with both.

Section 35 of the Act further provides that, if the Central Bank of Malaysia is of the opinion that any statement made in an advertisement issued by a banking or financial institution is false, deceptive, offensive or misleading, the Central Bank of Malaysia may by notice in writing direct the institution to do all or any of the following

• cease the continued issue of the advertisement
• modify the advertisement in such manner as may be specified by the Central Bank of Malaysia.
• cease the issue of any advertisement which is, wholly or substantially, a repetition of such advertisement
• take all practical steps to withdraw the advertisement from every and all publication or display of it or
• publish a statement in like manner as the advertisement issued earlier to retract or modify such advertisement.