Thursday, July 28, 2016

Has the PM’s Department decided to award the East Coast Rail Link to China Communications Construction Company (CCCC) for an inflated cost of RM60 billion without any tender?

The Sarawak Report has exposed new documents which alleged that the Malaysian Government is in the midst of finalising a new contract to award China Communications Construction Company (CCCC) for a whopping sum of RM60 billion.  The East Coast Economic Region Development Council had previously expected the cost of the project to be ‘only’ RM30 billion.

Malaysians are taken aback by the speculated cost for the project and cannot be blamed for giving Sarawak Report the benefit of the doubt because the whistle-blower website has been proven right time and again, especially with regards to its reporting of the multi-billion dollar 1MDB scandal.

As a measure of comparison, the 329km Ipoh-Padang Besar double-tracking project was awarded to MMC-Gamuda consortium for RM14.5 billion in 2003.  More recently in December 2015, the 179km Gemas-Johor Bahru link was awarded to China Railway Engineering Corporation for the sum of RM7.1 billion.  On average, the railway projects cost RM44.0 million and RM39.8 million per kilometre respectively.

However, at the cost of RM60 billion, the 620km ECRL will cost a monstrous RM96.8 billion per kilometre to construct.  That would mean that the ECRL will cost 120% and 143% more than northern and southern double-tracking projects respectively!

The massively inflated alleged cost of the ECRL without a tender exercise lends credence to the Sarawak Report documents which detailed how the “excess” was to bailout the debt-stricken 1MDB.

The documents reveal that CCCC, upon the award of the inflated contract, will via a nominated “credit-worthy” company pay 1MDB the sum of US$850 million (RM3.4bn) for the purposes of repayment for International Petroleum Investment Corporation (IPIC) advances, and assume the debt of 1MDB subsidiaries amounting to US$4.78 billion (RM19.4bn) inclusive of interest which had been guaranteed by IPIC.

These payments are clearly meant to go towards the settlement with IPIC which has taken 1MDB to the London arbitration court for the amount of US$6.5 billion.

More interestingly, part of the sum from the inflated cost will go towards acquiring substantial stakes in fugitive Low Taek Jho-linked companies, Putrajaya Perdana Bhd and Loh & Loh Corporation Bhd for US$244 million and US$71 million respectively.

In addition, there is a proposed payment by CCCC to a “consultancy/strategic/comms services” company and another “nominated company” for the amounts of US$65 million and US$200 million respectively.  The payment for the unnamed mysterious “nominated company” was to be made upon the official signing of the ECRL contract expected in December this year.  Hence, it appears that even in the exercise of a desperate bailout, generous commissions will be paid to certain parties, perhaps to continue their lifestyles of luxury and debauchery.

In effect, the Najib administration is merely ECRL as an excuse and an outrageous cover up to mask additional borrowings of RM30 billion in order to repay the billions embezzled from 1MDB.  Most tragically, it means that ordinary Malaysians as the Government will finance the entire ECRL project with more crippling debt.  We are merely covering up a gigantic hole by digging ourselves an even bigger hole.

We call upon Dato’ Seri Najib Razak to confirm or deny that the award of the contract to CCCC is in the works, and provide transparent and accountable justifications for the award in the absence of any competitive tender exercise.

Wednesday, July 27, 2016

Deloitte Malaysia washes hands off 1MDB while the new 1MDB Board of Directors failed its first test of integrity and accountability

Yesterday, the new Board of Directors of scandal-ridden 1MDB had peculiarly announced that “its 2013 and 2014 audited financial statements should no longer be relied on until allegations made by the United States (US) Department of Justice (DOJ) are determined in court”.

The announcement further added that 1MDB is in the midst of seeking a new auditor after Deloitte notified of its intention to resign on Feb 26.

It is clear from this peculiar announcement coming hot on the trails of the DOJ exposé was a result of Deloitte finally telling 1MDB that they no longer stand by the March 2013 and 2014 financial statements which they signed off on 28 March 2014 and 5 November 2014 respectively.

The evidence presented by the DOJ clearly showed that Deloitte has made a complete mess of 1MDB’s audit for the two financial years.  The auditors were made complete fools by 1MDB’s executives who repeatedly embezzled billions of dollars from the company.  They were hoodwinked, perhaps too readily, by fictitious documents and outrageous lies presented by the company’s management.

Deloitte has failed to discover in its audit that 1MDB had made more than US$3.5 billion of payments over the course of 2012 to 2014 to a fraudulent Aabar Investment PJS Limited, incorporated in the British Virgin Islands (BVI). 

Deloitte found nothing suspicious in 1MDB Global Investment Limited’s US$1.56 billion investment in several dodgy and obscure investment funds, including the Devonshire Growth, Enterprise Emerging Markets and Cistenique investment funds.  The US DOJ had determined that these funds had acted as conduits in the money laundering scam, including US$681 million which had ended up in the Prime Minister, Dato’ Seri Najib Razak’s personal bank account.

Deloitte was also led to believe that US$1.22 billion was successfully redeemed from 1MDB’s fake investment in the Cayman Islands, when in reality 1MDB was making round-tripping transactions with money from its subsidiary, 1MDB Global Investment Limited.  This was revealed separately by documents exposed by the Sarawak Report.

Deloitte’s gullibility had allowed 1MDB executives and the Najib administration to cite and abuse the international audit firm’s international “reputation” to lend credibility to 1MDB.  They helped mask the multi-billion dollar shenanigans which were taking place in the state-owned enterprise for the past few years.

With the DOJ’s exposé, it has finally come to a stage where it is no longer tenable for Deloitte to standby the financial statements it audited for 2013 and 2014. Hence 1MDB was forced into making this queer announcement to deny the veracity of its own financial report.

While Deloitte’s belated withdrawal of its endorsement for 1MDB’s financial statements were understandable, the 1MDB Board’s continued insistence that “no wrongdoing has been committed by 1MDB and that the past audited financial statements continue to show a true and fair view of the company’s affairs” is shocking and utterly irresponsible.

Despite the overwhelming evidence which has publicly surfaced, the newly appointed Directors led by Treasury-General Tan Sri Irwan Serigar is persisting with a massive cover up of the crimes which have taken place within 1MDB.

It is now obviously that Tan Sri Irwan Serigar is only interested in carrying on the “stellar” work of the previous Board of Directors who had resigned en masse in absolute disgrace in April. 

When the Treasury-General had testified before the Parliamentary Public Accounts Committee in June 2014, he had absolved himself from all blame by claiming that he had no control or supervisory powers over 1MDB.  In fact, he blamed Clause 117 of 1MDB’s Memorandum and Articles of Association which grated all such powers directly to the Prime Minister.

However, despite the abolition of the above Clause and his appointment as the new Chairman, Tan Sri Irwan Serigar has shown that he is cut from the same cloth.  His loyalty is to Dato' Seri Najib Razak and he has little care for integrity and accountability.

Tuesday, July 26, 2016

Dato’ Seri Najib Razak should stop pulling the wool over the rakyat’s eyes with purported social welfare programmes by 1MDB which are in actual reality, funded by Malaysian taxpayers

It beggars belief that the Prime Minister, Dato’ Seri Najib Razak could still heap praise on 1MDB for “making immense contribution to social welfare programmes”.

He announced that 1MDB Foundation sponsored RM10.4 million for 1,100 pilgrims to go to for pilgrimage this year; recipients of which were present with Najib in a Putrajaya mosque today to receive their offer letters yesterday

The 1MDB Foundation contribution to social welfare is a farce designed with the specific intent to mask the fact that 1MDB has made billions of ringgit of losses, as a result of an international money laundering exercise involving the Prime Minister himself.

If 1MDB had made real profits and subsequently allocated part of these profits to charitable causes, then the efforts by the state-owned company should certainly be applauded.

However, 1MDB which had funded itself entirely by debt by borrowing at its peak, RM55 billion ringgit, never made a sen of cash profits in its entire 6 years of existence. 

This means that 1MDB had effectively paid for its “immense contribution to social welfare programmes” with borrowings as a public relations exercise to repair the damage to its reputation caused by its massive losses and scandalous misappropriations.

Worse, because 1MDB was cash-strapped and unable to fulfil its debt obligations on a timely basis, government agencies were forced to step into bail out 1MDB.

For example, Tabung Haji – the pilgrimage fund, was called upon to acquire a piece of 0.64 acres of land from 1MDB in Tun Razak Exchange for the exorbitant price of RM188.5 million or approximately RM2,774 per square feet in 2015.  1MDB had earlier acquired the land from the Government at the bargain basement price of only RM64 per square feet.

It is of the greatest irony the Dato’ Seri Najib Razak boasted of 1MDB’s RM10.4 million contribution to the 1,100 pilgrims – who were supposed to be funded by Tabung Haji, when Tabung Haji has been ripped off of more than RM184 million from the above transaction alone.

What’s more, now that 1MDB is unable to service its debts and is faced with a US$6.5 billion suit from Abu Dhabi’s International Petroleum Investment Corporation (IPIC) in London, the tax-payers is now faced with another round of a multi-billion dollar bailout exercise by the Ministry of Finance which had explicitly or implicitly guaranteed the above debts.

Worse, the United States Department of Justice has now provided clear evidence of how US$731 million belonging to 1MDB was deposited in the Prime Minister’s personal bank account between 2011 and 2013.  Hence it is clear that what has been distributed to the poor in Malaysia is dwarfed by what Dato’ Seri Najib Razak received.

Therefore we call upon the Prime Minister to stop putting on a false front on 1MDB.  The public relations exercise is doomed to fail because the facts and evidence of the multi-billion dollar embezzlement from 1MDB is clear for all to see.

Dato’ Seri Najib Razak will serve the Rakyat better by explaining why he took US$731 million from 1MDB and why did he allow his son-in-law, Riza Aziz and the latter’s best friend, Low Taek Jho to pillage 1MDB to buy luxury properties, pay for gambling debts, acquire an aircraft, collect art masterpieces and finance their decadent lifestyles.

Saturday, July 23, 2016

1MDB, a simple yes or no will do: have billions of dollars of 1MDB's money been “misappropriated” and “embezzled”?

1MDB must not evade the factual allegations laid out by the US Department of Justice but answer the simple question if billions of dollars of its money have been “misappropriated” and “embezzled”.

In the face of allegations by the United States (US) Department of Justice (DOJ) that US$3.5 billion or more have been misappropriated and embezzled from 1MDB, the state-owned investment fund provided the world with the most ludicrous response.

1MDB merely responded that “it is not a party to the civil suit, does not have any assets in the United States of America, nor has it benefited from the various transactions described in the civil suit”.

The outstanding management led by Arul Kanda at 1MDB must surely realise that the DOJ never made 1MDB “party to the civil suit”. Neither did they accuse 1MDB of having “assets in the United States of America”.

The US DOJ has laid out the entire scam claiming 1MDB was a victim of a multi-billion-dollar international fraud.

Hence the question 1MDB must respond to is whether it finally accept that it is a victim of a treasonous fraud in the light of the lorry-load of hard evidence presented.

Or is Arul Kanda and his team still oblivious to the entire scam where multi-billion dollars have been lost?  How difficult is it for these super-clever to executives to figure out if the money is missing or otherwise?

For example, the BSI Bank Singapore has been shut down, but where is the US$940 million which was purportedly parked in the bank?  Did it vanish into thin air as well?

Or the purported US$1.56 billion of “investments” in the dodgy investments funds identified by the US DOJ – Devonshire, Enterprise and Cistenique – are they still in existence?

Or the fact that the US DOJ, like Bank Negara Malaysia, has established clearly that Good Star Limited, which received US$1.03 billion directly from 1MDB, is indeed owned by Low Taek Jho, and not by Petrosaudi International Limited as claimed – is 1MDB still in denial?

Or, more plausibly, Arul Kanda and his team are conniving conspirators in the entire scam. Is he is doing his utmost to cover up the scam which involved the Malaysian Prime Minister himself embezzling more than US$700 million into his personal account?

We call upon the newly appointed Board of Directors of 1MDB, led by its new Chairman, the Treasury-General, Tan Sri Irwan Serigar to not repeat the disgraceful failures of the previous Board.  He must, as the country’s top financial civil servant, act without fear or favour in the interest of the Malaysian tax-payers.

If the President of 1MDB, Arul Kanda is not acting in the interest of the shareholder, then fiduciary duty demands that Tan Sri Irwan Serigar sack the entire 1MDB top management with immediate effect. The Chairman must state openly, if 1MDB has indeed been a victim of fraud and seek the return of the pilfered proceeds back to the country.

In the light of the size and scale of the scandal, the Board of Directors must also place 1MDB under temporary management by the remaining Big Four audit firm which has not been tainted by the scandal, PriceWaterhouse Coopers.

If Tan Sri Irwan Serigar fails to act in the interest of Malaysian tax-payers, then he himself will be guilty of conspiring with the evil wrong-doers which committed the mult-billion dollar heist of the century.  Pakatan Harapan leaders will then demand for the Treasury-General to be sacked in disgrace.

Thursday, July 21, 2016

Malaysia now global laughing stock as the US DOJ moves to seize some US$1 billion of assets stolen from 1MDB, while the Malaysian Government remain inexplicably oblivious to the grand theft

Yesterday, the Wall Street Journal (WSJ) reported that the US Federal prosecutors are poised to launch one of the largest asset seizures in U.S. history as they step up their investigation into billions of dollars siphoned away from 1Malaysia Development Bhd (1MDB).

The US Department of Justice are expected to seize more than $1 billion worth of assets, the single largest seizure in the history of the United States, which are expected to include properties and other assets purchased with money allegedly misappropriated from 1MDB.

Reuters have now confirmed the WSJ report. The U.S. Department of Justice filed lawsuits today saying that over $3.5 billion was misappropriated from 1MDB.

The lawsuits, filed in Los Angeles, seek to seize assets "involved in and traceable to an international conspiracy to launder money misappropriated from 1MDB".  The lawsuits said the alleged offences were committed over a four-year period and involved multiple individuals, including Malaysian officials and their associates, who conspired to fraudulently divert billions of dollars from 1MDB.

Those named included Riza Aziz, Dato’ Seri Najib Razak’s step-son, Low Taek Jho, or Jho Low, and Abu Dhabi government officials Khadem al-Qubaisi and Mohamed Ahmed Badawy Al-Husseiny.

More interestingly, the charge claimed that funds misappropriated from 1MDB were transferred to Petrosaudi, a company that had a joint venture with 1MDB, and thereafter to a high-ranking official in the Malaysian government it identified only as "Malaysian Official One".

The assets involved in the case include penthouses, mansions, artwork and even a private jet.

In the past, the Najib administration has consistently dismissed the WSJ allegations as “unsubstantiated malicious allegations” as part of a “global conspiracy” to “bring down a democratically elected government”.  The Malaysian investigating agencies took the que and refused to conduct any genuine investigations into the monstrous heist despite mounting evidence and damning Auditor-General and Public Accounts Committee Reports.

However, the shit has hit the fan with the latest actions taken by the United States authorities.  Surely, Dato’ Seri Najib Razak will not now turn around and accuse his golfing buddy, President Obama of being part of a global malicious conspiracy to bring down his Government?

As a result, we are now the butt of jokes to the world. The US authorities has moved to seize some US$1 billion of assets stolen and misappropriated from 1MDB, and yet the victim, the Malaysian Government insists that we weren’t robbed.

We call upon the Dato’ Seri Najib Razak to chastise our local regulatory authorities for their ineptitude in getting to the bottom the scandal which isn’t only the largest in the history of Malaysia, but also has set the ignominious record of being the largest seizure in the history of United States.

The Prime Minister must instruct the police and the MACC to follow the leads provided by the Department of Justice to charge all the relevant parties who have stolen billions from Malaysians, including but not limited to Riza Aziz and Jho Low. 

Most importantly, they must obtain and discover, who is the “Malaysian Official One” who has been accused of siphoning billions of ringgit of 1MDB’s borrowed wealth.

Monday, July 18, 2016

What has happened to the complaint filed with the Malaysian Institute of Accountants against KPMG and Deloitte which were filed more than a year ago?

I have filed complaints against the auditors of 1Malaysia Development Bhd (1MDB) against KPMG and Deloitte Malaysia, their partners Ahmad Nasri Abdul Wahab and Ng Yee Hong, in March and June 2015 respectively with the Malaysian Institute of Accountants (MIA).

I had alleged that both firms intentionally and/or negligently failed to conduct sufficient and necessary due diligence and audit of 1MDB which have resulted in the filing of fraudulent 1MDB annual financial statements.

My complaint against KPMG was for its failure to take into consideration the material disclosures of the transactions which took place in 1MDB’s then US$1 billion investment to form an aborted joint venture with Petrosaudi International Limited in 2009-2010.

Of the above sum, Bank Negara Malaysia (BNM) has confirmed to the Public Accounts Committee (PAC) that US$700 million was siphoned to an unrelated company, Good Star Limited whose ultimate beneficiary was Low Taek Jho, or more popularly known as Jho Low.

In fact, KPMG performed the arguably record-breaking feat of signing off the March 2010 financial audit within 3 weeks after being appointed in September 2010, after the original auditors Ernst & Young (EY) were sacked. EY had refused to sign off 1MDB’s financial statement due to irregularities in the transactions with Petrosaudi.

Most crucially, KPMG also intentionally and/or negligently failed report the fact that 1MDB’s sale of its shares in the joint venture with Petrosaudi and their conversion into a loan took place after the March 2010 financial year.  As a result, 1MDB was able to report artificially inflated profits and failed to disclose the key transactions which were highly dubious within 1MDB Petrosaudi Limited.

Deloitte Malaysia had taken over from KPMG after the latter was sacked by 1MDB in December 2013.  KPMG had refused to sign off the March 2013 accounts because it was unable to verify the authenticity of 1MDB’s US$2.318 billion investment in a dodgy investment fund parked in Cayman Islands.

I had accused Deloitte Malaysia of intentionally and/or negligently failing to conduct sufficient and necessary due diligence and audit of the cash flow and liquidity risk 1MDB.   Deloitte endorsed 1MDB as a going concern on 5 November 2014, after which 1MDB immediately failed to repay a RM2 billion loan at the end of November 2014.

This was because Deloitte Malaysia has failed to perform a thorough authentication and verification of 1MDB’s investment in the Cayman Islands, which turned out to be fraudulent.  Of the US$2.318 billion investment, US$1.15 billion has "disappeared" into the now exposed fake Aabar Investment PJS Limited which was incorporated in the British Virgin Islands.

The balance of US$940 million was supposedly kept in BSI Bank, Singapore.  However, the sum appears to have disappeared altogether after the Singapore authorities shut down the bank for facilitating money laundering.

In addition, Deloitte Malaysia has failed in its audit of 1MDB’s financial statements for March 2013 and 2014 when it failed to properly expense the stock options which 1MDB had granted to Aabar.  The failure to account for the stock options granted, worth at least US$993 million (RM4 billion) meant 1MDB reported over reported profits of RM778 million in 2013 and under reported loss of only RM669 million in 2014.

As of today, 1MDB has yet to file its accounts for March 2015 while Deloitte remains their auditors.

It is now 16 and 14 months since I’ve filed the respective complaints with the MIA.  The MIA is the statutory body established the Accountants Act, 1967 to regulate and develop the accountancy profession in Malaysia.

However, I have not heard from MIA in more than a year.  No action seems to have taken place.  Investigations, if any, appears not to have achieve any outcomes.

I call upon the MIA Council led by its President, Dato Mohd Faiz Mohd Azmi to explain the snail’s pace of dealing with the above complaints, despite their severity and scale, as well as the involvement of high profile public interest.

Friday, July 15, 2016

Are the new 1MDB Board of Directors led by Treasury-General Tan Sri Irwan Serigar going to turn a blind eye after the Sarawak Report exposed an outrageous round-tripping fraud involving US$1.22 billion?

The Sarawak Report first exposed the banking documents on 11 July which showed that 1MDB Global Investment Limited (1MDB GIL) transferred US$1.28 billion between September to November 2014 to the fraudulent Aabar Investment PJS Limited which was incorporated in the British Virgin Islands (“Aabar(BVI)”).

Yesterday, the Sarawak Report leaked more explosive sections from the Auditor-General’s Report relating to transactions between Brazen Sky Limited, another 1MDB subsidiary which held 1MDB’s controversial investments with a little-known Cayman Islands investment fund and 1MDB GIL.

The Sarawak Report concluded based on the additional information from the classified report, 1MDB clearly concocted a round-tripping exercise to give the impression that it has successfully redeemed cash from the Cayman Islands investment.  The fraudulent transactions were apparently so convincing that 1MDB’s auditors, Deloitte Malaysia happily signed off the company’s audited accounts.

Assuming the leaked copy of the AG’s Report is genuine, this is a massive allegation because for the first time hard evidence is shown to incriminate 1MDB officials as parties colluding with the owners of the fake Aabar (BVI) - Mohamed Al Husseiny and Khadem al Qubaisi.

Those incriminated include Datuk Shahrol Halmi, the former 1MDB CEO who was instrumental in 1MDB’s investment in the Cayman Islands fund; Mohd Hazem Abdul Rahman, who was the CEO when the above round-tripping transactions took place and Arul Kanda Kandasamy, the current 1MDB President who is covering up the above shenanigans.

The exposé by Sarawak Report would hugely complicate 1MDB’s case in the arbitration proceedings brought by International Petroleum Investment Corporation (IPIC) against 1MDB involving US$6.5 billion.  IPIC is the parent company of Abu Dhabi’s Aabar Investment PJS, both of whom have officially denied that Aabar (BVI) is ever related to their group.  1MDB’s knowing participation with Aabar (BVI) to defraud both IPIC and the Malaysian government would certainly compromise 1MDB’s claims that it was an innocent victim to IPIC’s then employees Al Husseiny and Al Qubaisi.

What is more immediately important however, is what is the new 1MDB Board of Directors going to do about this new information, now that it has been made public?

The previous Board of Directors led by Chairman Tan Sri Lodin Wok Kamaruddin were forced to resign in shame after the Public Accounts Committee (PAC) condemned them in its report on 1MDB to the Parliament.  These Directors failed miserably to carry out their fiduciary duties and responsibilities with any degree of diligence.

A recent exposé by Sarawak Report also showed that the previous board has blindly signed a retrospective approval of the US$1.2 billion payments by 1MDB GIL to Aabar (BVI) more than a year after these fraudulent transactions took place.  These good-for-nothing “cari makan” directors included Tan Sri Ismee Ismail, Tan Sri Ong Gim Huat, Ashwin Valiram, Datuk Shahrol Halmi and Arul Kanda.

The question now is, will the new Board of Directors appointed on 31 May 2016, led by Treasury-General, Tan Sri Irwan Serigar do a better and proper job?

Together with the other 2 new Board Members, Datuk Kamal Mohd Ali and Dato’ Norazman Ayub, are they going to demand answers to these new explosive allegations and act on them – including but not limited to filing police reports?  It is part of the directors’ roles and responsibilities to investigate cases of fraud and report them accordingly to ensure the interest of the Malaysian tax-payers are fully protected.

Or will they similarly turn a blind eye on indisputably, the single largest case of financial fraud in Malaysia’s history?

Thursday, July 14, 2016

Datuk Dr Mohd Puad Zarkashi should look himself in the mirror first before asking Tan Sri Muhyiddin Yassin to read the 106-page PAC Report on 1MDB

After former UMNO deputy president Muhyiddin Yassin and former senator Ezam Mohd Noor demanded that the Auditor-General’s (AG) Report on 1MDB be declassified to ensure accountability and transparency, UMNO Supreme Council Member Datuk Dr Mohd Puad Zarkashi asked to read the Public Accounts Committee (PAC) Report on the matter properly.

Puad said that if they had read it, they would not have asked that the report be declassified.  He said the conclusions of the auditor-general and PAC could be found on pages 103 to 106 and it was wrong for Muhyiddin to fault Prime Minister Najib Abdul Razak for classifying it when it was on the request of the auditor-general himself.

I had to laugh out loud when I read the comments made by Puad.

Firstly, the Auditor-General had only specifically requested for his report to be classified while it was being deliberated by the PAC.  He told the PAC that it is up to the PAC to publish the AG’s Report upon the completion of PAC’s own report.

The PAC Chairman, Datuk Hasan Arifin himself has explained to the media on March 7, that “the federal audit report on 1MDB will no longer be classified a state secret under the Official Secrets Act (OSA) once the PAC tables its findings on it in Parliament.”

Hence if Dato’ Seri Najib Razak and his Cabinet was not to be faulted for refusing to declassify the AG’s Report, then who is?

Secondly, it is once again ridiculous, just as was claimed by the Multimedia and Communications Minister, Datuk Seri Salleh Keruak, that there was no need for the AG’s Report to be made publicly accessible since the PAC Report has already been tabled.

The Public Accounts Committee (PAC) in its proceedings, relies almost entirely on the findings of the AG Report to present its deliberations, conclusions and recommendations.  In fact, the PAC members understood that the AG’s Report was to be presented together with the the PAC Report to provide a complete picture with detailed facts and figures to the Parliament. 

Hence the PAC Report itself made extensive references to the findings AG’s Report without citing the details for the simple reason that the committee members were expecting the AG’s Report to be published together with the PAC Report.

In fact, PAC members from the government backbench and opposition concurred fully with the AG’s Report and never at any point of time, as recorded in the PAC Hansard, disagreed or rejected the findings.  Hence all the findings in the AG’s Report must be deemed factual and dealt with accordingly by the authorities.

Why is Datuk Dr Puad Zarkashi and the entire Barisan Nasional leadership so afraid of these facts within the AG’s Report to be published?

It is also a joke for Puad to claim that “the bits of the auditor-general's report can be taken randomly without fully knowing the context of the information,” giving “rise to various speculations.”

If Puad is so worried about these “bits” giving the wrong context, then surely, he must immediately advise his party President to declassify the full report immediately so as to prevent these “bits” from being leaked by parties like the Sarawak Report. 

Why is Puad so scared of declassifying the report?  Unless of course, he knows that the AG’s Report contains damning evidence of multi-billion dollar misappropriation and abuse of power which will expose all the lies and deceit expounded by 1MDB and the Prime Minister himself.

Wednesday, July 13, 2016

Did 1MDB GIL pay US$1.283 billion to Aabar Investment PJS Limited to bluff Deloitte that the sums redeemed from 1MDB’s Cayman Island investments were “received”?

When Sarawak Report exposed banking records of 1MDB Global Investment Limited (1MDB GIL) which paid US$1.28 billion to the fraudulent Aabar Investment PJS Limited (“Aabar (BVI)”) between 12 September to 14 November 2014, many questions were raised.

Why did 1MDB GIL pay Aabar (BVI) the money even though there were no business transactions, agreements or dealings between the two entities?  Why wasn’t these fund transfers disclosed and explained during Arul Kanda’s testimonies with the PAC?

Unfortunately, my questions in my statement issued yesterday did not elicit any response from the 1MDB President, Arul Kanda.

Then it occurred to me that the 1MDB Financial Statements for the year ending 31 March 2014 was signed off by the auditors, Deloitte coincidentally on 4 November 2014, where 1MDB GIL also made a payment of US$222 million to Aabar (BVI).

At that point in time, there was increasing concern over 1MDB’s US$2.318 billion investment in an obscure investment fund based in Cayman Islands.  The Board of Directors minutes have shown that the Management were repeatedly instructed to redeem the investment and repatriate the proceeds back to Malaysia throughout 2014. The company was under immense pressure because the authenticity of the investment was being publicly questioned.

Based on the testimony of Deloitte to the Public Accounts Committee (PAC), the auditors were particularly insistent that 1MDB was able to redeem most, if not all of the Caymans investment before signing off the much-delayed statements which were already past due.

The accounts were finally signed off by Deloitte when 1MDB was able to “show” the auditors that US$1.22 billion have been redeemed.  The money was however, not repatriated to Malaysia.

The Mar 2014 Financial Statements wrote that “as at the date of this report (4 Nov 2014), the amounts received from the redemption of investments US$1.22 billion… have been substantially utilised for the purposes of debt interest payment, working capital and payments to Aabar as refundable deposits…”

Based on the 1MDB GIL transactions Sarawak Report exposed 2 days ago, coincidentally 1MDB GIL has paid US$1.22 billion to Aabar (BVI) by 4 November 2014! (See Table 1 below)

Hence we have now figured out the most likely reason why 1MDB GIL made these mysterious unexplained payments to Aabar (BVI).  The transactions were meant to hoodwink Deloitte into accepting that all the funds purportedly “received” from the Cayman Islands amounting to US$1.22 billion have pretty much been immediately used to pay Aabar (BVI).

The catch is, the money used to pay Aabar (BVI) did not come from the controversial Caymans investment, but from 1MDB’s own funds in its wholly-owned subsidiary, 1MDB GIL!  Unfortunately, Deloitte was sufficiently cheated and bluffed by the 1MDB crooks to sign off the accounts so readily.

We call upon Deloitte to review the documents shown to them for them to be so sufficiently satisfied as to sign off the 1MDB accounts so readily.  Should these documents shown to them prove to be fraudulent or manipulated on hindsight, they must immediately file police reports to clear their name and ensure that the crooks are investigated.

Tuesday, July 12, 2016

Arul Kanda must explain why 1MDB Global Investment Limited paid US$1.279 billion to Aabar Investment PJS Limited when these entities had no business relationships

The Sarawak Report yesterday exposed another set of banking transaction documents separate from the classified Auditor-General’s Report on 1MDB which showed that 1MDB Global Investment Limited (GIL) paid a total of US$1,279,347,500 between 12 September and 4 November 2014 to the British Virgin Islands (BVI) incorporated Aabar Investment PJS Limited.

1MDB GIL is a wholly-owned foreign subsidiary of 1MDB while Aabar (BVI) has been exposed as a fraudulent entity pretending to be the subsidiary of Abu Dhabi’s International Petroleum Investment Corporation (IPIC).

The Sarawak Report rightly highlighted the failure of UBS Bank Singapore which received the money on behalf of Aabar (BVI) to properly ascertain the purpose, source and recipient of the funds.  The Monetary Authority of Singapore has already shut down another Swiss Bank, BSI Singapore in May for serious breaches of anti-money laundering requirements, poor management oversight of the bank’s operations, and gross misconduct by some of the bank’s staff.  The latest exposé hence raises the question as to whether UBS Singapore will be similarly investigated and have action taken against the Bank.

However, a bigger question mark arising from the above is why did 1MDB GIL make the US$1.279 billion payment to Aabar (BVI) in the first place?

1MDB GIL had borrowed US$3 billion in March 2013 purportedly to form a joint venture company with Abu Dhabi’s Aabar Invesmtent PJS to develop the Tun Razak Exchange in Kuala Lumpur.  However, the joint venture did not materialise.

If the joint venture is as good as dead, as testified by Arul Kanda himself to the Public Accounts Committee in January 2016, why did 1MDB GIL make the US$1.279 billion payment to Aabar (BVI) in 2014 which he did not disclose to the Committee?

Furthermore, according to 1MDB’s financial statements, 1MDB GIL was left with only US$1.56 billion invested “in various investment portfolios under the custody of a licensed financial institution”.  The rest of the funds have already been used up “for working capital and debt repayment purposes” by 31 March 2014.

Arul Kanda had also testified that the US$1.56 billion of 1MDB GIL investments were intact and will be possibly utilised as part of 1MDB’s rationalisation exercise.  However, if US$1.56 billion was indeed intact, then how did 1MDB GIL make the US$1.279 billion of cash payments to Aabar (BVI)?

The exposé of the latest documents by Sarawak Report has caught Arul Kanda with his pants down and proved that he has lied and withheld crucial information from the PAC.  This would be the real reason why Arul Kanda has refused to produce simple bank statements of 1MDB GIL to even the Auditor-General despite repeated requests to do so.

We call upon the local and international authorities to investigate all parties involved in the above transactions – Aabar Investment PJS Limited, 1MDB and UBS Bank for a international money laundering operation involving Malaysian tax-payers funds. 

Action must be taken against all parties who approved and abetted the above illicit transactions to ensure the integrity of our local and international financial system.

Monday, July 11, 2016

If the leaked Auditor-General’s Report on 1MDB by Sarawak Report is genuine, the Police must catch the crooks instead of going after whistleblowers!

On Saturday, the Inspector-General of Police (IGP), Tan Sri Khalid Abu Bakar said the police will probe whistleblower site Sarawak Report under the Official Secrets Act (OSA) for leaking the classified auditor-general’s report on 1MDB, but only after they verify that it was the genuine document.

“We’re also not sure if the document they published is genuine. So let me discuss with the auditor-general first to make sure whether the document is truly the auditor-general’s report, which has been classified as secret.  If it's true, then we will investigate under OSA. So let’s all calm down first.”

The IGP’s statement is shocking on several counts.  For one, Malaysians are shocked that after months since the Public Accounts Committee (PAC) tabled its report on 1MDB to Parliament demanding investigations on Datuk Shahrol Halmi and others involved in defrauding 1MDB, the Police have yet to gain access to the detailed Auditor-General’s Report on 1MDB.

Has the Police been so lackadaisical in its investigations on 1MDB that it hasn’t already obtained a copy of the AG’s Report on 1MDB?  The IGP looked like a fool disclosing to Malaysians that he still has to “discuss with the AG first” to determine if what was leaked on Sarawak Report was indeed the AG’s Report.

Or has the Najib administration decided to maintain the AG’s Report as an OSA document so that even the Police will have difficulty accessing it?  Is this the real reason why the Cabinet has refused to declassify the report as it should have, so that the crooks behind 1MDB cannot be easily and properly investigated?

Regardless, if the leaked AG’s Report by Sarawak Report which exposed the billions defrauded and covered up by 1MDB officers is indeed genuine, Malaysians are shocked that the IGP isn’t at all interested in getting to the bottom of the scam and putting the crooks behind bars.

As the Chief of Malaysian police, Tan Sri Khalid Abu Bakar should be thoroughly scandalised and embarrassed by the single largest multi-billion dollar heist which has taken place under his nose over the past 5 years.  However, from his media response, he appeared completely indifferent to the great robbery but instead is more interested in a witch hunt to capture and charge the heroic whistleblower under the Official Secrets Act.

The IGP would do well to remember that police officers are sworn to protect Malaysians against criminals and not instead to cover up for crooks.  The Official Secrets Act, draconian that it may be, was designed to protect the national interest of the country, particularly against the leaking of security secrets to foreign agents. 

The AG’s Report on 1MDB is not a national security document.  It is a document which audited 1MDB for tens of billions of ringgit lost and has been exposed as such by the Sarawak Report.  It is hence a crucial evidentiary report against the masterminds behind the 1MDB scam and any attempt by the IGP to suppress the evidence will pervert the course of justice in Malaysia.

Sunday, July 10, 2016

Is Multimedia and Communications Minister Datuk Seri Salleh Keruak calling the findings of the Auditor-General is frivolous and hence should be disregarded?

It appears that Dato’ Seri Najib Razak’s cheerleaders are busy lining up to play down the damning Auditor-General’s (AG) Report on 1MDB which has been exposed by the Sarawak Report.

Multimedia and Communications Minister, Datuk Seri Salleh Keruak is now telling Malaysians that the Auditor-General’s Report on 1MDB is not a “final” report and hence insinuates that the findings and conclusions presented should be ignored.

“In fact, the auditor-general’s report is not complete because it addresses just one aspect of 1MDB.  The complete report is the one from the PAC because it not only takes into account the auditor-general’s report but all the other information gathered as well,” Salleh wrote on his blog.

The biggest irony was when he argued that the Sarawak Report has intentionally “misled” the public with the AG’s Report. There is no bigger attempt to mislead the public than the Minister of Multimedia and Communications himself by playing down the findings of the AG’s Report.

The Public Accounts Committee (PAC) in its proceedings, relies almost entirely on the findings of the AG Report to present its deliberations, conclusions and recommendations. In fact, the PAC members understood that the AG’s Report was to be presented together with the the PAC Report to provide a complete picture with detailed facts and figures to the Parliament. 

Hence the PAC Report itself made extensive references to the findings AG’s Report without citing the details for the simple reason that the PAC was expecting the AG’s Report to be published together with the PAC Report.

Therefore, the AG’s Report wasn’t merely “one aspect of 1MDB” as Salleh claimed, but an integral part of the PAC Report on 1MDB, without which the PAC Report would be incomplete.

The PAC Chairman himself has explained to the media on March 7, a month before the publication of the PAC Report that “the federal audit report on 1MDB will no longer be classified a state secret under the Official Secrets Act (OSA) once the PAC tables its findings on it in Parliament.”

The Members of the PAC, as well as Malaysians at large were hence shocked when Datuk Hasan Arifin autocratically rescinded what he promised and decided against publishing the AG’s Report, without any discussions with the Committee.

Datuk Seri Salleh Keruak must also accept the fact that there was nothing in the PAC Report which contradicted or negated the findings of the AG’s Report.  In fact, PAC members from the government backbench and opposition concurred fully with the AG’s Report and never at any point of time, as recorded in the PAC Hansard, disagreed or rejected the findings.

Hence all the findings in the AG’s Report must be deemed factual and dealt with accordingly by the authorities.  The question of the AG’s Report being “incomplete” does not arise at all.

Datuk Seri Salleh Keruak should stop becoming Dato’ Seri Najib Razak’s Minister of Miscommunication by trivialising the AG’s Report and insulting the professionalism of Auditor-General Tan Sri Ambrin Buang. Instead he should be scandalised by the findings of the Report and demand for heads to roll for all who were involved in the elaborate 1MDB scammed which cheated billions of dollars from Malaysian taxpayers, to protect the “good name” and credibility of the Government.

Saturday, July 09, 2016

Deputy Home Minister Datuk Nur Jazlan Mohamad should advise the PM and the Cabinet to declassify the Auditor-General’s Report on 1MDB

I am extremely disappointed that Deputy Home Minister, Datuk Nur Jazlan Mohamad had called on the Police to investigate Sarawak Report, which has successfully procured a copy of the Auditor-General’s (AG) Report on 1MDB for breach of the Official Secrets Act (OSA).

The exposé is a feat even I could not achieve because the Public Accounts Committee (PAC) Chairman Datuk Hasan Arifin has ruled that even PAC members could not retain a copy of the document.  This is despite the fact that we have been specifically cleared to access the Report.  I could only read the Report during the PAC meetings or upon request at the Parliamentary office.

This particular disappointment with Datuk Nur Jazlan Mohamad was because he was formerly the Chairman of the PAC prior to his “promotion” as the Deputy Home Minister.  Of all people, Datuk Nur Jazlan should understand the concept of accountability and transparency which he preached during his tenure as the Chairman.

In fact, Datuk Nur Jazlan often led the line to demand answers from 1MDB, gave clear instructions to the Auditor-General on the information to be acquired and even concluded that the mysterious key-man, Low Taek Jho be summoned to testify before the PAC.  His stand on the matter was clear and can be read in the published Hansards as well as his press conferences.

What has caused the 180 degrees about turn in his position on the investigation on the single largest financial scandal in Malaysia’s history since his appointment to the front bench?

His endorsement for the Police to pursue the whistle-blowers would unfortunately, also destroy all the goodwill and reputation he has gained over the past few years as one of the few UMNO politicians with some trace of integrity.

Malaysians would have pinned hopes on him to carry on his crusades for better accountability in the administration of government subsidiaries.  In this case, we would have hoped that he would at the very least attempt to convince the Prime Minister, Dato’ Seri Najib Razak and his Cabinet that the right thing to do under the circumstances is to “declassify” the Report as it ought to have been.

Datuk Nur Jazlan must make it clear to the Prime Minister that with the Report already leaked, there is no choice for the Government but to declassify the Report to save its own credibility and reputation.  What is the point of keeping it a secret any more now that it has been leaked?

Otherwise, Datuk Nur Jazlan and the Malaysian Government will be seen as clearly attempting to cover up the enormous scandal to protect the wrong doers in the debt-ridden state-owned company.

Thursday, July 07, 2016

The best Hari Raya present: the Auditor-General's discoveries on 1MDB which the Najib administration tried to hide via the Official Secrets Act (OSA)

It appears that The Sarawak Report has successfully procured the classified Auditor-General’s Report on 1MDB with the relevant accompanying documents.

It is a feat even I could not achieve because the Public Accounts Committee (PAC) Chairman Datuk Hasan Arifin has ruled that even PAC members could not retain a copy of the document.  This is despite the fact that we have been specifically cleared to access the Report.  I could only read the Report during the PAC meetings or upon request at the Parliamentary office.

What is important however, isn’t the feat itself, but the fact that the whole wide world can now confirm what was speculated earlier as the real reason why the AG’s Report has not been declassified and presented to the Parliament.  It is because the Auditor-General’s comments on the fishy tales and documents supplied by 1MDB is even more damning than the already damning PAC Report on the 1MDB investigations.

For example, 1MDB made payments to the British Virgin Islands (BVI) Incorporated Aabar Investment PJS Limited amounting to US$1.15 billion between May to November 2014.  These were originally explained to the Auditor-General as compensation payments for the termination of options granted to Aabar.

However, much later, after it was exposed that they have separately made another payment of US$993 million for the same purpose in November 2014, 1MDB changed their tune and claimed the US$1.15 billion was meant for a separate “top-up security” Deposit to Aabar.


1MDB even got its Board of Directors to retrospectively approve the above US$1.15 billion “top-up security” payment one year later in November 2015.

This was despite the fact that Arul Kanda, as the Chief Executive of 1MDB would have already received notification from International Petroleum Investment Corporation (IPIC) and its subsidiary, Aabar Investment PJS of Abu Dhabi in July 2015 that the BVI-incorporated Aabar is a fictitious entity unrelated to them!

In the spirit of honesty and decency during the month of AidilFitri celebrations, Dato’ Seri Najib Razak must immediately instruct the declassification of the AG’s Report, which was never meant to be permanently classified.  After all, if he has nothing to hide and insists that the Sarawak Report has once again falsified documents and doctored, in this case the AG’s Report, then making public the “real” Report will once and for all destroy Sarawak Report’s credibility.

The failure to declassify the Auditor-General’s Report however, would only prove to Malaysians and the whole wide world that we have a Prime Minister who is guilty of one of the biggest cover up in the history of the world.  It would also ultimately confirm the public perception that we are a country run by kleptocrats.

Wednesday, June 29, 2016

As GE14 approaches, the Najib administration is abusing all its paws of power to politically persecute Opposition leaders in order to stay in power

The DAP condemns the politically-motivated persecution of Penang Chief Minister and DAP Secretary-General Lim Guan Eng for alleged corruption.

He is expected to be charged in the George Town Sessions Court under Section 23 of the MACC Act and Section 165 of the Penal Code.  The first charge relates to alleged abuse of power with regards to the re-zoning of land, and the second concerns the bungalow, which he is accused of acquiring below market price.

Over the past few months, Chief Minister’s and the Penang state government have demonstrated proof that there was no impropriety in Lim’s purchase of the bungalow as there was no contracts or benefits granted to the seller, whether directly or indirectly.

Hence the MACC’s move to prosecute Lim, which coincided with the resignation of the top 2 MACC officials just days earlier, is clearly designed to destroy him politically. It also demonstrates the Najib administration’s sense of invincibility after the convincing wins in Kuala Kangsar and Sungai Besar by-elections.  The Prime Minister is seizing the opportunity further weaken the opposition after imprisoning Dato’ Seri Anwar Ibrahim, before possibly calling for an early election next year.

This is not the first time Lim Guan Eng is being persecuted by the Barisan Nasional government.  He was arrested in 1994 for criticising the government's failure to bring then-Chief Minister of Melaka, Tan Sri Abdul Rahim Thamby Chik's statutory rape case to trial when the Attorney General had decided not to press charges.  Lim was then charged under Section 4(1) (b) of the Sedition Act 1948 and the Printing Presses and Publications Act 1984.  He was sentence to 18 months jail and served time in Kajang prison.

Despite his incarceration, Lim never lost the trust of the people and was immediately voted back into Parliament and the Penang state assembly in 2008.  He has since proven the opposition’s ability to rule in Malaysia and transformed Penang into the most envied state in the country.

We believe in Lim Guan Eng’s integrity and innocence and we will stand resolutely with him to fight these charges which are made without legal basis.  We call upon all Malaysians who believes in a competent, accountable and transparent government to stand together with Lim Guan Eng, with the DAP and Pakatan Harapan, to fight the corrupt and repressive Barisan Nasional regime.