This article first appeared in The Edge Malaysia Weekly on March 16, 2026 - March 22, 2026
Last week, MMAG Holdings Bhd (KL:MMAG) and NexG Bina Bhd (KL:NEXGBINA) came under the spotlight after it became public knowledge that the Royal Malaysian Police had frozen their bank accounts since late last year in connection with investigations under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA).
NexG Bhd (KL:NEXG) — whose six directors resigned last Wednesday — is a substantial shareholder of MMAG and NexG Bina, holding 9.525% and 32.61% equity interest in the companies, respectively.
Surprisingly, both companies said they became aware that their accounts had been frozen only after failing to make payments for certain operating expenses, having received no prior formal notice of the freeze.
According to NexG Bina, the issue was brought to the attention of its board only during a meeting in February this year. The company has warned that its ongoing development projects could face suspension, and might be exposed to potential lawsuits and claims for breach of contract.
Meanwhile, MMAG said it is unable to determine the financial and operational impact on the company resulting from the frozen accounts.
The authorities’ actions have raised red flags at both MMAG and NexG Bina, particularly on corporate governance.
Questions also arise as to whether management promptly escalated “unusual activity” to the board and whether the board had sufficient visibility over the companies’ finances and banking arrangements, highlighting potential weaknesses in internal oversight and monitoring mechanisms.
These cases underscore the critical role of independent directors, which needs to be strengthened for greater transparency and accountability in daily operations and financial flows, while reinforcing robust checks and balances.
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