Monday, February 08, 2016

Why has Hasan Arifin declared that the PAC will be calling its final witnesses on 11th and 12th February when no such decision was made during past meetings?

The Malaysian Insider reported yesterday that the Public Accounts Committee (PAC) Chairman, Datuk Hasan Ariffin announced that the PAC will close its investigations on 1MDB after hearing from its last 2 witnesses on 11th and 12th February 2016, before receiving its report from the Auditor-General.

They are the former president and chief executive officer of 1MDB Datuk Shahrol Azral Ibrahim Halmi and former 1MDB chairman Tan Sri Mohd Bakke Salleh.

I have read the above news with surprise as the matter has never been discussed in any of the previous PAC meetings.  During the last meeting, we have agreed for Datuk Shahrol Halmi and Tan Sri Mohd Bakke Salleh to be summoned during the above dates in February.

However, it was never decided that there will be no more witnesses to be called as part of the PAC’s investigations into the 1MDB scandal.

There are at least several other parties who are extremely relevant to the investigations as they have intimate knowledge of the activities which have been carried out by the wholly-owned Ministry of Finance subsidiary.

Those who should be called by the PAC includes but are not limited to Bank Negara Governor, Tan Sri Zeti Akhtar Aziz and another former Chief Executive Officer, Mohd Hazem Abd Rahman.

It is crucial for the PAC to hear directly from Tan Sri Zeti and her Bank Negara officials because the Central Bank has via a statement in October last year, revoked three permissions granted to 1MDB under the Exchange Control Act 1953 (ECA) for investments abroad totalling US$1.83 billion.

Bank Negara had also issued a directive under the Financial Services Act 2013 to 1MDB to repatriate the amount of US$1.83 billion to Malaysia and to submit a plan to it for this purpose.

Bank Negara’s testimony will offer crucial information on the alleged offences, if any, leading to the above unprecedented actions against 1MDB.

On the other hand, Hazem’s testimony is crucial because he was 1MDB’s CEO from March 2013 to January 2015.  During his reign, a US$3 billion bond was raised via Goldman Sachs for the purposes of a joint venture with Abu Dhabi’s Aabar Investment PJS in March 2013.  However, the joint venture never materialised, half the proceeds from the bonds issued have been utilised and the remainder invested in undisclosed investment funds overseas.

In addition, Hazem was responsible for the purchase of the RM1.2 billion of encumbered land in Penang and the failure of the initial public offering of 1MDB’s energy arm.

Under the previous chairmanship of Datuk Nur Jazlan Mohammad, the PAC has previously set a date for Hazem to attend a PAC hearing in August 2015 before the PAC was suspended prior to the appointment of Datuk Hasan Ali.  The PAC then had also formally requested for the Ministry of Finance to secure the attendance of Low Taek Jho, who was the Special Advisor to the Chairman of the 1MDB Board of Advisors, Dato’ Seri Najib Razak.

The matter is of prime importance because the credibility and integrity of the Parliament’s PAC is at stake.  We are one of the sole remaining institutions still actively investigating the 1MDB scandal, and hence the Malaysian public are relying on PAC members to carry out their duties diligently without fear or favour.  The failure of the PAC to be thorough in our investigations will not only disappoint Malaysians, it will give the perception that the PAC is biased in favour of 1MDB and the authorities.

I call upon Datuk Hasan Ariffin to discuss the matter of calling additional witnesses to the PAC before completing our investigations at the next PAC meeting.
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