Berita Harian has exposed how foreigners can obtain Malaysian identification documents for RM5,000 (S$2,000) and citizenship papers for RM150,000.
It said these criminal syndicates would then get help from corrupt enforcement officers to provide passports or MyKad.
The syndicates are protected by gangs who would threaten enforcement officers if they fail to do their bidding.
The report stated that birth certificates were sold at RM5,000 each, MyKad at RM15,000 each and passports at RM50,000 each.
The paper said a syndicate would buy personal data from a Malaysian before applying for a MyKad or passport.
A journalist for the daily, who posed as the wife of a migrant worker, managed to obtain "Malaysian citizenship" documents processed in Sabah through an agent with inside help from several men believed to be enforcement officers.
"With the MyKad, you can apply for a licence, open a bank account and do other official things as a citizen.
Even if you misplace your passport, you can reapply for a new one anywhere as the data is already in the system," the agent said.