Monday, March 09, 2015

Messaging Conversation Between PSI CEO And Jho Low Exposed

As the Finance Minister, Dato’ Seri Najib Razak must confirm if he has given the go-ahead for 1Malaysia Development Bhd to extend additional US$500 million loans to PetroSaudi International Limited’s wholly-owned subsidiary?

For the very first time, emails exposed by the Sarawak Report on the monster 1Malaysia Development Bhd (1MDB) scandal have implicated the Prime Minister, Dato’ Seri Najib Razak and his possible involvement in the PetroSaudi International (PSI) collaboration fiasco.

In a messaging conversation where Patrick Mahony, CEO of PSI was expressing grave concern over the need for approval by Bank Negara Malaysia (BNM) for a fund transfer from 1MDB to the PSI subsidiary, Jho Low (JL) had insisted that only the Ministry of Finance approval for the loan is required, and the loan had already been signed by the Prime Minister, who is also the Finance Minister.


Patrick: We need protection that we were allowed to take these funds
Patrick: Bnm approval has always been in there
Patrick: It was in the email I sent you, nik knows about it
Patrick: I thought this was all approved including all regulatory approvals?
JL: Can u just say “regulatory approval”
JL: Yes I know. But we r arguing we don’t need bnm as offshore
JL: Ministry of finance has approved
JL: Not bnm cause we don’t think bnm needed
Patrick: So can we get mof approval?
JL: Mof approval is required for the loan which we have signed by pm who is also FM
JL: When u borrow monies abroad, its not needed
JL: I will tell nik to email u
Patrick: Please get us some proof that there is high level approval and also if you don’t think bnm needed, the reason
Patrick: Then we should be fine
JL: Legally, mdb only needs mof approval for loan
JL: No approval needed to send out monies

[…]

Patrick: Is there a board resolution from mdb approving this?
JL: Yes. On top of all of it
JL: No worries
JL: For sure
JL: Minister of finance n board approval

This exposed conversation raises several pertinent issues and questions.

Firstly and perhaps most importantly, did the Finance Minister, Dato’ Seri Najib Razak approve the loan which was signed between 1MDB and the PSI subsidiary?  1MDB had mysteriously converted their US$1 billion shares in the 1MDB Petrosaudi Limited joint venture (JV) on the last day of the 31 March 2010 financial year, into a US$1.2 billion (RM4.3 billion) loan in the form of Murabaha Notes to the company.

The above conversation refers to an additional US$500 million (RM1.8 billion) which was extended to the PSI subsidiary on 8 September 2010.  Did the Finance Minister give his approval for these loans?

Secondly, the conversation exposed Jho Low’s intimate involvement in the operations of 1MDB to the extent that perhaps, Datuk Shahrol Halmi who was the CEO of 1MDB then, was a mere puppet.  Together with the evidence exposed by Sarawak Report earlier, Jho Low was involved from putting together the JV, to laying down the terms of the JV agreement and dictating all the relevant financial transaction sums on behalf of 1MDB, well before the 1MDB senior management are even involved.

We already knew that out of the initial US$1 billion invested by 1MDB into the JV, US$700 million was immediately siphoned out to a Swiss Bank account belonging to Good Star Limited, which was controlled by Jho Low and his associates. For the subsequent US$500 million loan to PSI, only US$340 million went to the PSI subsidiary while the balance of US$160 million was again deposited with Good Star Limited.

Dato’ Seri Najib Razak must explain how the national sovereign strategic development fund with an initial endowment of RM5 billion became a plaything for then 27 year old flamboyant wheeler-dealer in 2009?  As the Finance Minister and the man who kickstarted 1MDB, how did he allow such major infringement to take place?

Finally, should Dato’ Seri Najib Razak choose to deny his knowledge or involvement as claimed by Jho Low above, immediate actions must be taken against the latter for his actions to defraud 1MDB by abusing the name of the Prime Minister. The Prime Minister must file a Police Report demanding an urgent investigation of Jho Low for his false claims. In addition, he should also initiate a civil suit against Jho Low, not only for misrepresentation also for tarnishing the image and reputation of the Malaysian Prime Minister.

If Dato’ Seri Najib Razak fails to take concrete actions against Jho Low, then he cannot blame Malaysians for speculating on his complicity and involvement with the whole 1MDB-PetroSaudi rip-off.
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