Good News! Automatic Discharge for bankrupts coming soon!

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asked on Feb 7, 2012 at 17:26
edited on Aug 1, 2016 at 23:21
235,908 individuals declared bankrupt as of October 2011: DG

Published on: Wednesday, December 07, 2011

Kota Kinabalu: As of October this year, a total of 235,908 individuals were declared bankrupt in the country, said the Director-General of Insolvency Department Datuk Abdul Karim Abdul Jalil.

He said based on the records of the Malaysian Insolvency Department, the main causes for bankruptcy were hire-purchase agreements (26 per cent), followed by personal loans (21 per cent), housing loans (14 per cent) and other loans including business loans and corporate guarantees.

"This places Malaysia among the countries with a large number of bankruptcies compared to the other countries, with an average of 41 individuals declared bankrupt each day," he said.

Between 2005 and October this year, a total of 14,000 cases were discharged of bankruptcy at the discretion of the Director-General of the Department of Insolvency, Abdul Karim told reporters after opening the dialogue on insolvency at the Federal Administration Complex in Likas, here, Tuesday.

The discretion refers to the bankrupt individual paying back the loan on instalments continuously for more than five years and that they offered close cooperation with the Department of Insolvency.

Abdul Karim said the Government was reviewing the Malaysian Bankruptcy Act 1967 in efforts to assist those who were declared bankrupt to continue with life without the debt burden, including automatic discharge.


Datuk Abdul Karim Bin Abdul Jalil
Current Director-General of Insolvency (DGI)
From 16.04.2009 to current.
Department of Insolvency, MDI
Prime Minister's Department

Second chance

11 December 2011
By P. Selvarani

Under proposed amendments to the law, bankrupts will soon have an opportunity to start anew after five years

Debtors will have a lot of reasons to smile once proposed amendments to the law are passed to enable bankrupts to be discharged automatically.

It is learnt that under the amendments, bankrupts may be automatically discharged after five years without having to apply to the courts or wait for the approval of the director-general of Insolvency (DGI), to be freed of the social stigma.

The Insolvency Department is seriously considering this move -- which is practised in many countries -- to give bankrupts a second chance to start anew.

The automatic discharge was proposed as the department believes making people, especially those who are honest and credible, a bankrupt for life will not benefit anyone.

"In many cases, it does not help them or their creditors as some of these people really cannot nor have the means to settle their debts.

"Some debtors are also untraceable. So what's the point of having them in our statistics? An automatic discharge will help them get back on their feet and start life afresh," DGI Datuk Abdul Karim Abdul Jalil told the New Sunday Times.

However, he said, many issues needed to be looked into.

"Should any conditions be imposed before this automatic discharge procedure is applied, especially to the dishonest and non-cooperative bankrupts? Or can the creditors or the DGI raise objections in relation to the conduct of the bankrupt? These are matters we have to thoroughly look into."

Several countries, including Thailand and New Zealand, have laws which allow for the automatic discharge of a bankrupt after three years as long as the bankrupt is not involved in fraud.

In Canada, a first-time bankrupt is automatically discharged after nine months if he fulfills all his duties and does not have any excess income. In the United Kingdom, bankrupts may be discharged after a year.

Karim said the automatic discharge was among the proposals under amendments to the existing laws to create a single Insolvency Act.

The proposed amendments have been submitted to the attorney- general.

At present, apart from paying their debts in full to qualify for a discharge, bankrupts in Malaysia can also be discharged at the discretion of the DGI.

This was made possible under amendments to the Bankruptcy Act in 2003 which gave the DGI the authority to discharge a bankrupt after five years or more.

Previously, bankrupts could only be released by the court if they paid their debts in full or if they were wrongly declared a bankrupt.

The automatic discharge proposal was mooted in 2003, but the authorities then felt that it was not the right time to introduce it.

"So, we introduced the Certificate of Insolvency instead which gave the DGI the power to discharge a person after five years or more, subject to objections from the creditor.

"And we used this certificate to save credible entrepreneurs, such as those who became bankrupt due to the economic crisis and not because of their own folly."

Since then, the department has discharged 14,174 bankrupts based on their good conduct and cooperation.

"We had also discharged extremely poor people and the sick.

"Through our outreach programme, we had personally witnessed their condition.

"Some of them were so poor or sick that they could not even make ends meet, let alone repay their debts. In such cases, we released them from bankruptcy because it would benefit no one for us to continue administering their files. Instead, it may incur us unnecessary costs."

Karim said it was necessary to streamline insolvency laws in Malaysia, such as personal insolvency (under the Bankruptcy Act 1967), corporate insolvency (which comes under the Companies Act 1965) and other related laws for a more efficient administration of insolvency cases as many of the laws now overlapped with those of other agencies.

For example, although the DGI is the official receiver and liquidator of companies, which have wound up and societies and trade unions which have been de-registered, laws pertaining to these matters are still parked under the Companies Act 1965, Societies Act 1966 and Trade Unions Act 1959, which come under the jurisdiction of the respective agencies.

"The international trend now is to put all this into one legislation to be administered by one organisation.

"We don't want the functions to overlap.

"We need a more effective and innovative insolvency administration system to create a new insolvency landscape in the country. Without doubt, an effective and innovative insolvency system will contribute tremendously to a country's financial stability."

He said on an average, 41 individuals were declared bankrupt every day.

Most of the bankrupts had defaulted on the payment of their car loans.

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answered on Aug 13, 2013 at 05:01
edited Jun 22, 2016 at 05:26
Are you already bankrupt? If not, there are many ways of settling your problems.
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answered on Sep 17, 2013 at 22:03
edited Jun 22, 2016 at 05:59
I was made a bankrupt in June. Bank finally gives me 50% for full settlement (RM135,000). I only have RM80,000. Too bad that I cannot settle it. I am now writing to Jabatan Insolvensi Malaysia (JIM) to consider payment arrangement to keep my house and car either to allow me make monthly payment directly to bank or make 2 years payment in advance. My worry is on my asset. Being a bankrupt as a guarantor, JIM has instructed monthly payment to pay my bankruptcy case, about RM870 per month. I decide to pay this instead of getting 1Malaysia Fix Capital Xcess (1MFX) loan to make full settlement. In my calculation, if I get 1Malaysia Fix Capital Xcess (1MFX) to pay full settlement, my regular payment is RM2,000 monthly for 10 years which I think too much for a guarantor or 'penjamin' to liable and carry the burden. I would rather go bankrupt and pay RM870 per month instead. Now I am asking JIM to give me chance to keep my house and car, as I am capable to pay them. Will see if I could get it.
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answered on Feb 19, 2014 at 14:15
edited Jun 25, 2016 at 23:12
Azlan Kazaidin formerly of Jari Hijau Enterprise took RM260,000 from me and ran away with it without paying it back.

Cases like this.. he should be bankrupt for life. Those who become bankrupt by becoming guarantor should get automatic release and those who owed bank, credit cards etc. should be released once they have paid up their capital... minus interest. That's what l feel, I will be writing to the papers soon and will lobby the ministers concerned.

Business con-man and bogus dealing who took money from the public who premeditated their evil ways how to dupe the public by surrendering money for investment in their companies should be hung up with their bankruptcy status for life. This should be made clear otherwise, there will be loads there who will open-up companies, get money from the public and when they got enough they will get themselves declared as bankrupt or be made a bankrupt. Another aspect is that these bankrupts should not be given the hope or  the impression or illusion that they will be discharged from bankruptcy after 5 years. Because if they are given this hope or are under the impression they will be automatically discharged after 5 years, they will definitely not pay even if they have means to do so.

Let them be bankrupt for life or get released only after they have paid -up.

One last note before I leave, I read some comments and really feel for those who are worried and are making every effort to pay their debt and I fully sympathize with the predicament they are in. The difference between a decent man and a conman is that a decent man will make attempts to pay but a conman as the name reflects will always find ways to escape. They won't mind being called a bankrupt, they have no shame and they have no heart.
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answered on Feb 19, 2014 at 17:16
Very true, there's lots of stupid law in the court that encourage people to play tricks with the court and avoid paying. Also the law have no encouragement for those who're honest enough to pay up.

Not only this happen in Bankruptcy laws, but in all other law as well as many judgments have been contaminated with corrupt lawyers, judges, court and shallow decision without any thought of its consequences. My only advise to people is avoid this corrupt court in all your dealings if possible.
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answered on Feb 19, 2014 at 19:08
edited Jun 25, 2016 at 23:14
...took RM260,000 from me and ran away with it without paying it back.
You gave it to him, not he took it from you. You gave the money to him, because you, like many others, were greedy.
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answered on Feb 19, 2014 at 21:16
edited Jun 25, 2016 at 23:15
Anyone would be foolish to surrender RM260,000 to anyone without sweet promises and a guarantee that the money would be returned within 6 months with dividend. Azlan Kazaidin and his family are still doing it to this day. Investors were persuaded to invest millions for a handsome return. This is not about greed, this is about honouring your promises to the public. Azlan Kazaidin did not only deceive one or two, he cheated dozens...
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answered on Feb 19, 2014 at 21:37
edited Jun 25, 2016 at 23:19
Take a look at one of the advert from one Azlan Kazaidin's family business... AK Synergy. This was the same scenario that he did when he was still operating his business under Jari Hijau Enterprise. The one in the photo is Azlan Kazaidin himself giving a talk about property Investment (Pelaburan Hartanah). Since he is now a bankrupt is he not supposed to be working for the family. If he is innocent, why the hell he did not defend himself in the court of law? And until today he still has not turned up at Jabatan Insolvensi Malaysia (JIM). While Azlan was in business, he would call prospective clients every single day sometimes 2 or 3 times a  day to chase up the money. Once he got the money he was so elusive... difficult to contact and eventually went missing. He did that to at least 12 people that I know off... and I got the evidence in the form of Police Report.


I was not interested at the beginning, I was thinking more about putting my money in ASN but that scum had been harassing and calling me up all the time... with all the promises and the guarantee that the investment would be a profitable one.

Have a look at the website. And if that is not enough I will paste the brochure if that is feasible.
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answered on Feb 19, 2014 at 22:31
Since you already have police report, nothing much you can do as it is up to the police to decide whether to charge or catch him or not.

Unfortunately in this country, the police and the AG normally will not charge anybody over personnel scam like this as they feel it is only a business lost and nobody got hurt (unless you got high level connection).
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answered on Feb 20, 2014 at 00:30
edited Jun 25, 2016 at 23:23
Hi and thank you for the response.

Azlan kazaidin is now a 'muflis'... a bankrupt. He failed to turn up at Jabatan Insolvensi Malaysia (JIM) and he is still working for his family... that is against the rule of bankruptcy. The Police report is dinosaur... long case. This is now.
He needs to go through the interview and let them decide what's what. I know Azlan Kazaidin will lie through his teeth just like he had lied before and will lie again, no doubt. As a young man of 30+ he has the capability to earn and he has a long long way (not unless he die in a freak accident) to live and support his family.

Since he is a bankrupt and if he earns money and has asset, let JIM decide what can be done to repay the lost. If he can't repay... then he should hold the title for life... so that he will not have another opportunity to con the public again.
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answered on Feb 20, 2014 at 18:19
edited Jun 25, 2016 at 23:24
Anyone would be foolish to surrender RM260,000 to anyone without sweet promises and a guarantee that the money would be returned within 6 months with dividend.

You are the foolish and greedy one. Greedy for dividends. A fool and his money are soon parted.
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