By: Sonny Zulhuda

My latest book chapter co-worked with my colleague Dr Mohd Yazid Zul Kepli who also led the project.

“Cryptocurrencies and Anti-money Laundering Laws: The Need for an Integrated Approach”

This chapter attempts to clarify and describe the legal and regulatory framework for cryptocurrency with special focus on Malaysia and the threats that it poses from the anti-money laundering perspective.

Currently, very few countries have legislations that regulate cryptocurrency. Nonetheless, the crazy surge in prices (to more than 20-folds at some point) has sent both legitimate investors and criminals flocking to cryptocurrencies.

This chapter analyses and compares the official reports from various governments, writings of government officials, experts and scholars in journals and newspapers, interviews and draws conclusions on the legal framework of cryptocurrency, and money laundering challenges.

The study notes that the decision of the US regulators in allowing Bitcoin futures to trade on major exchanges to be one of the reasons behind the sudden surge. The study also finds that the South Korean regulators’ approach in banning its financial institutions from dealing with virtual currency is a positive one.

The chapter stresses that it is not adequate for regulators to warn the public to act with extreme caution and increase their understanding on the risks they take on if they choose to invest in cryptocurrencies. Instead, it is necessary to have comprehensive international and national laws and regulations for the control and management of cryptocurrencies. In addition, the anti-money laundering legal framework must be improved to cater to the new threats posed by cryptocurrency.

Citation:

Kepli, M. and Zulhuda, S. (2019), “Cryptocurrencies and Anti-money Laundering Laws: The Need for an Integrated Approach”, Oseni, U., Hassan, M. and Hassan, R. (Ed.) Emerging Issues in Islamic Finance Law and Practice in Malaysia, Emerald Publishing Limited, pp. 247-263. https://doi.org/10.1108/978-1-78973-545-120191020

August 17, 2019
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By: Sonny Zulhuda

This ICCD Annual Conference 2019 is the sixth edition as a yearly academic activity held by the Association of Muslim Community in ASEAN (AMCA).

This edition it takes place in Bandar Seri Begawan, Brunei Darussalam.

The opening of the Conference was officiated by HE Dr Sudjatmiko the Ambassador of the Republic of Indonesia in Brunei Darussalam.

In his speech, the Ambassador congratulates the organisers and highly hopes that the participants would come up with concrete answers or proposals to many problems faced by people today.

In this Conference I will deliver a keynote inshaAllah.

July 24, 2019
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By Sonny Zulhuda

I have an honour to deliver on cyberlaw and cybwr crimes as part of legal curriculum development at IAIN Padangsidimpuan, North Sumatera, Indonesia.

The event is aimed at sharing with the lecturers from the Faculty of Syariah and Law so as to integrate the cyberlaw issues into the curriculum. This is to answer the challenges of the Industrial Revolution 4.0.

The Rector Prof Dr Ibrahim Siregar opened the forum with an impressive message for all the participants.

In his speech, Prof Ibrahim encourages all the staff to pursue higher studies including achieving the professorship.

Kudos for IAIN PADANGSIDIMPUAN!

July 18, 2019
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Oleh: Sonny Zulhuda

Bicara tentang masalah sistem IT (tepatnya sistem informasi) KPU bisa dimulai dengan membedahnya dengan menggunakan pisau bedah “CIA” – Yaitu aspek kerahasiaan, keutuhan dan ketersediaan sistem tersebut.

Aspek-aspek inilah yang mendasari kriteria keandalan sistem elektronik sebagaimana tertuang dalam pasal 16 Undang-undang No. 11/2008 (UU-ITE) dan juga telah menjadi dasar konseptual pemidanaan cybercrime dibawah Budapest Convention 2001.

Pertama, tentang KERAHASIAAN sistem (“Confidentiality”). Intinya adalah bahwa sebuah sistem informasi yang aman wajib menjaga kerahasiaan sistem informasi dan membatasi akses hanya kepada yang betul-betul berwenang.

Pertanyaan yang bisa disodorkan adalah seperti berikut:
1. Siapa saja yang bisa mengakses sistem IT KPU?
2. Siapa yang berwenang memiliki kode akses (password, PIN, etc) terhadap sistem tersebut?
3. Apakah pengelolaan sistem IT KPU dapat diakses dan dimanipulasi oleh orang yang tidak berwenang?

Kedua, tentang faktor keutuhan (integritas) sistem informasi. Pesan utamanya adalah bahwa sistem informasi termasuk segala data dan proses yang terkait tidak boleh diragukan validitasnya, kebenaran dan keutuhannya. Segala halbyang dapat mereduksi integirtas sebuah sistem harus dienyahkan.

Hal-hal yang dapat ditelisik termasuk:
1. Apakah data yang masuk sudah dipastikan akurasi, keutuhan dan kebenaran faktualnya? Contoh, apakah DPT sudah akurat? Apakah penghitungan suara tepat?
2. Apakah keandalan sistem tersebut sudah diuji kekedapannya terhadap peretasan?
3. Apakah ada sistem pengujian terhadap keabsahan data yang akan, sedang dan telah diproses?

Ketiga, perihal ketersediaan dan dapat diaksesnya sistem informasi (“Availability”). Intinya adalah bahwa sebuah sistem yang andal adalah yang dapat berfungsi sesuai tujuan dan linimasa yang telah digariskan. Sistem tersebut mesti andal dan bertahan dan mereduksi resiko kegamangan informasi.

Untuk itu bisa diselidiki antara lain:
1. Apakah sistem IT KPU kita selalu online dan dapat diakses dengan baik oleh pengguna (masyarakat)?
2. Apakah pengelola mengantisipasi resiko-resiko serangan terhadap sistem tersebut?
3. Apakah sistem informasi KPU memiliki prosedur pengamanan dan recovery yang tepat menghadapi krisis data seperti downtime, insiden peretasan, bencana dsb?

Sebagai pondasi penting ketiga faktor ini adalah isu pengaturan yang baik (“Good governance”) yang memprasyaratkan kepemimpinan teladan, transparan, jujur dan adil.

Sekian, sekadar urun sharing.
Artikel ditulis di <sonnyzulhuda.com>

May 26, 2019
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By: Sonny Zulhuda

Data is an asset in today’s interconnected world. With the changing digital lifestyle and emerging digital workplace, managing personal data becomes a key trust factor for organisations.

The digitalisation of process and records, mobile workplace concept, synchronisation of gadgets and data, as well as emergence of smart contract have all contributed to this change.

Internally, managing data serves as a critical assets management. Externally, it becomes a shield of legal compliance as well as a key competitive value in a more increasingly regulated environment.

In many parts of the world, Personal Data Protection (PDP) is made as a critical trade issue, including a potential trade barrier in the event of trans-border data transfer.

The EU General Data Protection Regulations (GDPR) is setting a new global PDP benchmmark. Meanwhile in this part of the world, Malaysia, Singapore and the Philippines are already enforcing their respective PDP laws. Soon Indonesia and Thailand are following the suit with the drafting and enacting of the laws.

The requirement of PDP law raises a new set of data due diligence for organisations. Privacy Impact Assessment (PIA) and data breach notification (DBN) are among those legal regime that requires careful due diligence under the PDP law.

In short, all life cycles of data management have now to be embedded in a comprehensive, cross-sectoral governance within the virtually every data-reliant organisation.

The data management policies need to be comprehensive and up-to-date. Public communication has to be real-time. For that purpose, not only do we require a specially designated high-level data protection officer (DPO), but also a regular transparency report on our data affairs.

Gone are the days that data protection is only seen as technical and trivial issues. PDP is now a boardroom issue, looking out to both reputational and legal risks and opportunities.

April 7, 2019
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