Friday, April 08, 2016

Dato’ Seri Najib Razak needs to take full responsibility for the RM55 billion 1MDB debacle and take concrete measures to ensure full compliance by the company

The  spin  masters  in  the  Prime  Minister’s  Department  are  operating  in  full  swing  to  deflect any  blame  on  Dato’ Seri Najib Razak over  the  damning  Public  Accounts  Committee  (PAC) Report which has been tabled yesterday on 1Malaysia Development Bhd (1MDB).

Dato’ Seri  Azalina  Othman  went  so  far  as  to  say  that  the  report  also  confirmed  that  the Prime  Minister  did  not  commit  any  offences  or  contribute  to  any  criminal  offences,  hence proved that all allegations made against him were baseless.

Worst,  Dato’  Seri  Najib  Razak  himself  attempted  to  make  light  of  the  highly  incriminating PAC  Report  by  focusing  on  the  irrelevant –  that  Tun  Dr  Mahathir  Mohammad  made  a mistake by claiming that “RM42 billion is missing”.  It is irrelevant because the point of the PAC Report wasn’t to determine “RM42 billion was missing” but how billions of ringgit might have been improperly siphoned.

Dato’ Seri Najib Razak  must  be  the  most  irresponsible  Finance  Minister in history  who  is more interested in political rhetoric than the scores of misdeeds outlined in the PAC as well as the Auditor-General’s  Report. Just  because  one  man  cited  the wrong figure for the amounts of funds which were not accounted for, does not mean that there were no billions of dollars which went missing.

We have already established that at least US$5.5 billion of 1MDB’s cash and assets could not be verified by the Attorney-General after a year of investigations.

Hence,  at  the  very  least,  Dato’  Seri  Najib  Razak  who  is  also  the  Finance Minister must be held to be ministerially accountable as 1MDB is a wholly-owned subsidiary of the Ministry of Finance (MoF). In fact, the debt which has been accumulated by 1MDB amounting to RM55 billion as at October 2015 is even larger that the entire RM32.3 billion budget for the Ministry of Finance in 2016!

The  degree  of  ministerial  accountability  is  even  higher, given  the  specific  provisions  of 1MDB’s  Memorandum  and  Articles  of Association  (M&A)  which  required  the  explicit  written endorsement  of  the  Prime  Minister  for  every  single  substantial  transaction  carried  out  by 1MDB.  Hence the Prime Minister had personally signed all written resolutions approving its investments in the failed US$1.83 billion Petrosaudi joint venture, the borrowing of US$6.5 billion of bonds,  the  multi-billion  ringgit  acquisition  of  the  power  plants  and  real  estate  as well as the sacking of both external auditors, Ernst & Young and KPMG.

Worse,  the  M&A  of  1MDB  explicitly  forbids  the  appointment of  any  MoF  officials  in  the company,  which  could  have  acted  as  an  additional  check  and  balance  on  the  rogue management.  The lack of oversight at the level of the Finance Ministry, as testified by the Treasury-General,  Tan  Sri  Irwan  Serigar  himself  to  the  PAC,  only  further  increases  the culpability of the Prime Minister in the entire scandal.

If  the Prime  Minister  hadn’t  personally  approved  these  resolutions,  then  none  of the shenanigans  cited  by  the  AG  could  have  taken  place. Hence, Dato’ Seri  Najib  Razak was either very stupid and reckless to sign these resolutions without proper consideration or he was very much part and parcel of the 1MDB scam. Either way, the Prime Minister must take responsibility and be held accountable.

Finally, and most importantly, Dato’ Seri Najib Razak has failed to direct 1MDB to cooperate with the  AG  and  the  PAC  by  providing  all  necessary  financial  statements, particularly  its banking records and statements overseas. Given that the allegations of impropriety by the Prime  Minister, especially  over  the  US$681  million “donation”  scandal  are  all  transacted overseas,  there  was no  way  for  the  AG  or  the  PAC  to  clear  the  Prime  Minister  of  these allegations.

Hence all attempts by the BN Ministers to exonerate Dato’ Seri Najib Razak of any culpability in the RM55 billion 1MDB financial scandal are well off the mark. If Dato’ Seri Najib Razak wants to remove any suspicions of links between 1MDB’s overseas funds and himself, then he must immediately reprimand 1MDB and direct 1MDB to hand over all its banking records overseas to the PAC and AG for further scrutiny.

If  not,  then  Dato’ Seri  Najib  Razak  will  be further  tainted  with  the  perception  that  he  is afraid of the truth being discovered and he has much to hide.
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