Malaysia may place microchips into government treasury cheques to prevent forgery involving government financial transactions, local media reported today.

"The cheats are getting smarter and we have to ensure we are always one step ahead of them," Second Finance Minister Jamaludin Jarjis was quoted as saying by the New Straits Times.

Jamaludin said his ministry would meet with relevant financial representatives, including from the Central Bank to discuss the matter.

"We will be calling for a meeting and I am confident we can find a solution to this."

One microchip that has been identified for use is the Malaysian Microchip, the paper said.

Work of syndicate

With a 0.5 millimetre square contact patch, an area as large as the head of a safety pin, it contains one of the world's smallest radio frequency identification antenna-integrated circuit, it said.

At least four Malaysian state governments have been the victim of a syndicate which has been issuing cloned State treasury cheques for the past three years, prompting a call this week by Prime Minister Dr Mahathir Mohamad to set up a special body to detect bogus government cheques.

The forgeries - allegedly masterminded by a 30-year-old unemployed man believed to be the son of a senior civil servant - are reported to have totalled at least RM5 million (US$1.32 million), including RM3 million from northern Penang state alone. - AFP