Wednesday, September 16, 2015

Letter to the United Kingdom Listing Authority to seek clarification on "missing" US$1.4billion from IPIC accounts

Yesterday, I sent a letter to the United Kingdom Listing Authority (UKLA) ‎requesting for UKLA to seek clarification from International Petroleum Investment Corporation (IPIC) on US$1.4 billion which is missing from its financial statements.

I have decided to write the letter because it appears that the financially distressed 1Malaysia Development Bhd (1MDB) is not at all concerned that its US$1.4‎ billion pledged as collateral with IPIC in exchange for a US$3.5 billion guarantee is reportedly "missing".

This matter was exposed by the Wall Street Journal last week but was met with disdain from 1MDB. The company was more interested in victimising the mystery whistleblowers than discovering the truth behind its funds.

I explained to the UKLA that the financial statements ‎of 1MDB audited by Deloitte Malaysia stated clearly that the Company placed US$1.4 billion of funds with IPIC as a "refundable deposit". It is classified as a non-current asset under "other receivables, deposits and prepayments".

However, when scrutinising the listing prospectus of IPIC bonds which was listed in the London Stock Exchange in December 2014, the US$1.4 billion did not appear anywhere in the published accounts of the company. ‎ Neither was the sum disclosed in the December 2014 audited accounts of IPIC published on 30 June 2014.

IPIC did disclose that they have provided a guarantee for the US$3.5 billion of bonds raised by 1MDB in 2012. However, there was no mention in any documents that they have received the collateral of US$1.4 billion.

Therefore my letter expressed the concern of Malaysian tax-payers over the missing funds belonging to a wholly-owned Ministry of Finance subsidiary. It is important for IPIC to make a public disclosure with regards to the above to provide 1MDB and its stakeholders the assurance that our interests are fully protected.

We hope that The UKLA will give due consideration to our request for clarification and we look forward to IPIC providing a full public disclosure to be published on the website of London Stock Exchange.

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