Moneylenders
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LAWS OF MALAYSIA
REPRINT
Act 400
MONEYLENDERS ACT 1951
Incorporating all amendments up to 1 January 2006
PUBLISHED BY
THE COMMISSIONER OF LAW REVISION, MALAYSIA
UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968
IN COLLABORATION WITH
PERCETAKAN NASIONAL MALAYSIA BHD
2006
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MONEYLENDERS ACT 1951
First enacted ... ... ... ... ... ... ...
1951 (Ord. No. 42 of
1951)
Revised
.....................
1989 (Act 400 w.e.f
14 December 1989)
PREVIOUS REPRINT
First Reprint
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...
...
...
...
2001
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LAWS OF MALAYSIA
Act 400
MONEYLENDERS ACT 1951
ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY
Section
1.
Short title and application
2.
Interpretation
2A. Non-application of Act and exemption therefrom
3.
(Deleted)
4.
Appointment of Registrar, Deputy Registrar, Inspector, and other officers
and servants
4A. Delegation of powers of Registrar
PART II
LICENSING OF MONEYLENDERS
5.
Licence to be taken out by moneylender
5A. Application for licence
5B. Grant of a licence
5C. Duration of licence
5D. Conditions attached to licence
5E. Renewal of licence
5F. Requirement to display licence
6.
Particulars to be shown on licences
7.
(Deleted)
8.
Offences
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Section
9.
Circumstances under which licence shall not be issued
9A. Revocation or suspension of licence
9B. Opportunity of being heard
9C. Appeal to Minister
9D. Validity of licence extended in successful appeal
9E. Prohibition of subsequent application pending appeal on earlier application
9F. Surrender of licence
9G. Transfer or assignment of licence prohibited
10.
(Deleted)
PART III
INVESTIGATION, SEARCH, SEIZURE AND ARREST
10A. Powers of Inspector or police officer in investigation
10B. Power to investigate complaints and inquire into information
10C. Power to examine persons
10D. Search by warrant
10E. Power of arrest
10F. Search without warrant
10G. Seizure of movable property
10H. Further provisions relating to seizure of movable property
10I. Obstruction of inspection and search
10J. Authority to act
10K. Release of property seized
PART IV
EVIDENCE
10L. Evidence of accomplice and agent provocateur
10M. Protection of informers and information
10N. Admissibility of statements by accused persons
10O. Provisions as to evidence
Moneylenders
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PART V
CONDUCT OF MONEYLENDING BUSINESS
Section
10P. Moneylender and borrower must enter into a moneylending agreement
11.
Advertisement by moneylender
11A. Application for advertisement permit
12.
No circular implying a banking business to be issued
13.
(Deleted)
14.
(Deleted)
15.
Contract by unlicensed moneylender unenforceable
16.
Moneylending agreement to be given to the borrower
17.
Prohibition of compound interest
17A. Interest for secured and unsecured loans
18.
Accounts to be kept in permanent books
19.
Obligation to supply information as to state of loan and copies of
documents relating thereto
20.
Provisions as to bankruptcy proceedings for moneylenders' loans
21.
Accounts under section 19 to be produced when suing in court
22.
(Deleted)
23.
Prohibition of charge for expenses on loans by moneylender
24.
(Deleted)
25.
Notice and information to be given on assignment of moneylender's
debts
26.
Application of Act as respects assignees
PART VI
MISCELLANEOUS
27.
Attestation of moneylending agreement
28.
(Deleted)
29.
False statements or representations to induce borrowing an offence
29A. General offences
29B. Harassment or intimidation, etc. of borrower
29C. Offences by companies, societies, firms or other body of persons
29D. Prosecution
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Section
29E. Service of notification or document
29F. Power to compound
29G. Jurisdiction
29H. Power to make regulations
30.
(Deleted)
30A. (Deleted)
31.
(Omitted)
FIRST SCHEDULE
SECOND SCHEDULE (Deleted)
THIRD SCHEDULE (Omitted)
Moneylenders
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LAWS OF MALAYSIA
Act 400
MONEYLENDERS ACT 1951
An Act for the regulation and control of the business of moneylending,
the protection of borrowers of the monies lent in the course of such
business, and matters connected therewith.
[Peninsular Malaysia--31 March 1952, L.N. 79/1952]
PART I
PRELIMINARY
Short title and application
1. (1) This Act may be cited as the Moneylenders Act 1951.
(2) This Act shall apply to the States of *Peninsular Malaysia
only.
Interpretation
2.
In this Act, unless the context otherwise requires--
"authorized name" and "authorized address" mean respectively
the name under which and the address at which a moneylender is
authorized by a licence granted under this Act to carry on business
as a moneylender;
" b o r r o w e r " means a person to whom money is lent by a
moneylender;
"company" means any body corporate being a moneylender;
*NOTE--All references to "West Malaysia" shall be construed as reference to "Peninsular Malaysia"
see the Interpretation (Amendment) Act 1997 [Act A996], subsection 5(2).
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"Deputy Registrar" means the Deputy Registrar of Moneylenders
appointed under section 4;
"firm" means an unincorporated body of two or more individuals
or one or more individuals and one or more corporations or two
or more corporations who have entered into partnership with one
another with a view to carrying on business for profit;
"Inspector" means an Inspector of Moneylenders appointed under
section 4;
"interest" does not include any sum lawfully charged in accordance
with this Act by a moneylender for or on account of stamp duties,
fees payable by law and legal costs but, save as aforesaid, includes
any amount by whatsoever name called in excess of the principal
paid or payable to a moneylender in consideration of or otherwise
in respect of a loan;
"licence" means a moneylender's licence issued under this
Act;
"Minister" means the Minister charged with the responsibility
for local government;
"moneylender" means any person who lends a sum of money
to a borrower in consideration of a larger sum being repaid to
him;
"moneylending agreement" means an agreement made in writing
between a moneylender and a borrower for the repayment, in lump
sum or instalments, of money borrowed by the borrower from the
moneylender;
"police officer" means a senior police officer as defined in the
Police Act 1967 [Act 344];
"prescribed" means prescribed by regulations made under this
Act;
"principal" means, in relation to a loan, the amount actually lent
to and received by the borrower;
"Registrar" means the Registrar of Moneylenders appointed under
this Act.
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Non-application of Act and exemption therefrom
2A. (1) This Act shall not apply to--
(a) any authority or body established, appointed or constituted
by any written law, including any local authority;
(b) any co-operative society registered under the *Co-operative
Societies Act 1993 [Act 502];
(c) any bank or merchant bank licensed under the Banking
and Financial Institutions Act 1989 [Act 372] or any
bank licensed under the Islamic Banking Act 1983 [Act
276];
(d) any insurance company licensed under the **Insurance
Act 1996 [Act 553];
(e) any company licensed under the Takaful Act 1984 [Act
312];
(f) any pawnbroker licensed under the Pawnbrokers Act 1972
[Act 81];
(fa) a development financial institution prescribed under the
Development Financial Institutions Act 2001 [Act 618];
and
(g) any licensed finance company as defined in subsection
2(1) of the Banking and Financial Institutions Act 1989.
(h) (Deleted by Act A1193).
(2) The Minister may--
(a) in consideration of the special circumstances relating to
the nature of the business of any company, or the objects
of any society, and its financial standing; and
(b) if he is satisfied that it would not be contrary to the
public interest to do so,
by notification in the Gazette exempt such company or society
from all or any of the provisions of this Act, and such exemption
shall be granted for such duration as may be specified in the
notification, and may be made subject to such limitations, restrictions
or conditions as the Minister may specify in the notification.
*NOTE--This Act has replaced the Co-operative Societies Act 1948 [Act 287]see section 95 of
Act 502.
**NOTE--This Act has replaced the Insurance Act 1963 [Act 89]see subsection 214(1) of
Act 553.
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(3) The Minister may at any time revoke any exemption granted
by him under subsection (2) if he is satisfied, after giving the
company or society concerned an opportunity to be heard, that the
company or the society, as the case may be, has failed to observe
any limitation, restriction or condition subject to which the exemption
was granted, or that it is otherwise no longer suitable to continue
to be granted exemption.
3.
(Deleted by Act A1193).
Appointment of Registrar, Deputy Registrar, Inspector, and
other officers and servants
*4. (1) For the purposes of this Act, the Minister may appoint a
Registrar of Moneylenders and such number of Deputy Registrars
of Moneylenders, Inspectors of Moneylenders and other officers
and servants as the Minister may deem fit from amongst members
of the public service.
(2) The Registrar and Deputy Registrars shall have and may
exercise any of the powers conferred on an Inspector by or under
this Act.
Delegation of powers of Registrar
4A. (1) The Registrar may, in writing, delegate all or any of his
powers or functions under this Act, except his power of delegation,
to any Deputy Registrar or Inspector appointed under section 4.
(2) Without prejudice to subsection (1), the Registrar may, in
writing, delegate any of his powers or functions under this Act in
respect of the investigation of offences under this Act and the
enforcement of the provisions of this Act to any public officer.
(3) Any delegation under subsection (1) or (2) may be revoked
at any time by the Registrar and does not prohibit the Registrar
from himself exercising the powers or performing the functions so
delegated.
*NOTE--For saving and transitional provision of this sectionsee subsections 46(1), (8) and (9)
of Act A1193.
Moneylenders
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PART II
LICENSING OF MONEYLENDERS
Licence to be taken out by moneylender
5. (1) No person shall conduct business as a moneylender unless
he is licensed under this Act.
(2) Any person who carries on business as a moneylender without
a valid licence, or who continues to carry on such business after
his licence has expired or been suspended or revoked shall be
guilty of an offence under this Act and shall be liable to a fine
of not less than twenty thousand ringgit but not more than one
hundred thousand ringgit or to imprisonment for a term not exceeding
five years or to both, and in the case of a second or subsequent
offence shall also be liable to whipping in addition to such punishment.
Application for licence
*5A. (1) An application for a licence to carry on business as a
moneylender shall be made in writing to the Registrar in a prescribed
form, and accompanied by such documents or information as may
be prescribed.
(2) The Registrar may in writing, at any time after receiving the
application but before it is determined, require the applicant to
provide within a specified time or any extension of time granted