MACC cracks down on scrap metal smuggling syndicates across five states

THE Malaysian Anti-Corruption Commission (MACC) has launched a sweeping operation targeting scrap metal smuggling syndicates in five states, uncovering a scheme that has allegedly cost the government over RM950 million in lost tax revenue over six years.

The raids, conducted under a joint initiative dubbed ‘Op Metal’, were led by the MACC’s Special Operations Division via the Multi-Agency Task Force (MATF), in coordination with the Royal Malaysian Customs Department (JKDM), Inland Revenue Board (LHDN), and Bank Negara Malaysia (BNM). A total of 19 locations across Penang, Selangor, Negeri Sembilan, Johor, and Kedah were searched.

MACC’s elite Anti-Corruption Tactical Squad (ACTS) was deployed in Penang, where six raids were carried out on Monday, including at residences, business offices, and scrap metal storage and processing facilities suspected of involvement in the smuggling operations.

Bernama reported that the first raid, observed by media, took place at 6am at a three-storey luxury bungalow in Batu Maung, believed to belong to a businessman owning a scrap metal enterprise. Officers entered the property after a domestic helper opened the door. The businessman was reportedly abroad at the time, while his wife, child, and elderly mother were at home.

Evidence and documents related to the smuggling network were seized, and ACTS personnel maintained security throughout the operation.

Later the same morning, media representatives joined the ACTS team for a raid at a scrap metal yard on Jalan Bukit Minyak in Bukit Mertajam. The fenced premises, which had just opened for business, contained large volumes of scrap metal in various forms, suspected to be processed for illegal export.

Nearly 30 employees, including office staff, were gathered for questioning. The site is believed to be connected to the businessman whose home was raided earlier. A man claiming to be the manager later arrived and pledged full cooperation as officers conducted further inspections and confiscated documents for investigation.

Additional coordinated raids were carried out at seven sites in Selangor, four in Kedah, and one each in Negeri Sembilan and Johor. These included offices, scrap yards, and private residences linked to other suspects believed to be involved in the illicit operation.

According to an informed source, the syndicates were exporting scrap metal—primarily to India, China, and other countries—but falsely declared the cargo as machinery or other metals not subject to the government’s 15 per cent export tax.

“To ensure the shipments passed inspections and avoided the tax, the syndicates are believed to have bribed several enforcement officers,” the source said.

The source added that this collusion had led to estimated annual revenue losses of RM160 million over the past six years, with cumulative losses exceeding RM950 million.

MACC Chief Commissioner Tan Sri Azam Baki confirmed the raids in all five states, stating that the operations focused on businesses and factories involved in overseas scrap metal exports. He added that the case is being investigated under Section 4(1) of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLATFPUAA 2001).

“Investigations are ongoing to identify individuals, including public servants, who may have protected or facilitated the syndicates’ activities,” Azam said. Arrests and further seizures are expected to be announced as the probe continues. - July 15, 2025