Unmasking company liability for corruption by associated persons

Purpose - The Malaysian Anti-Corruption Commission Act 2009 (MACC Act) has introduced Section 17 A, which holds companies and their management accountable for bribery committed by their Associated Persons in the interest of the company. This study aims to explore the evolving concept of Associated Persons and corporate liability within this legal framework. It delves into three primary legal models of Associated Persons, particularly focusing on corrupt cases falling under Sections 17 A (1), 17 A (6) and 17 A (7) of the MACC Act. The study also investigates the extent of Associated Persons’ involvement in these cases that eventually led to company liability. Design/methodology/approach - The study deployed thematic and comparative analyses to assess the legal framework and highlight the significance of Section 17 A of the MACC Act. Findings - The study disclosed that, despite having corruption policies, there is still a possibility for Associated Persons to engage in corrupt activities. To ensure long-term business sustainability, it is crucial to implement effective mechanisms and a strong compliance culture. Originality/value - This study suggests implementing a due diligence checklist and conducting risk assessments for companies as measures against corruption caused by Associated Persons. Corporate entities and legal professionals may benefit from the reported findings to better comprehend the corruption offences outlined in Section 17 A of the MACC Act.