A question for the IGP - Why the delay in 1MDB probe despite sufficient evidence?

In  an  interview  with  Singapore  broadcaster  Channel  News Asia, the Auditor-General (AG) Tan Sri  Ambrin  Buang said  his  report on 1Malaysia  Development  Berhad  (1MDB)  provided sufficient basis for an investigation on the state investment firm.

“I  think  our  report  is  sufficient  as  a  basis  for  further  investigation, we have done our job. The next step as recommended by PAC, they want investigation on certain personality in the company, let the  police  do  their  work, we will assist anyone who wants (to) investigate," Ambrin was quoted saying, referring to the Public Accounts Committee (PAC).

However, despite the PAC having tabled its report on the 7 April, more than six weeks ago, the Royal Malaysian Police has not even called up the key 1MDB protagonist identified in the entire scandal!

Home and Deputy Prime Minister Dato’ Seri Ahmad Zahid Hamidi informed the Parliament yesterday that the Police have yet to question former 1MDB CEO Shahrol Azral Halmi as part of their probe into the sovereign wealth fund.

"All witnesses involved will be called by police if necessary to record their statements and for further investigations.  Shahrol has not been called to record his statement as of yet," Zahid said when replying to the Member of Parliament for Raub, Datuk Mohd Ariff Sabri.

Why is the Police dragging their feet over the entire investigation?

In fact, I have personally first lodged a police report against 1MDB in March 2015, seeking investigations over the role of Datuk Shahrol Halmi, Jho Low and other individuals over their involvement in the 1MDB Petrosaudi investments.

For example, Datuk Shahrol Halmi has instructed payments of US$1.03 billion to Good Star Limited, which the Bank Negara Malaysia has informed the PAC as being “a company owned by an individual unrelated to Petrosaudi International Limited”.

I am not sure if I should be shocked that the Police has failed to even interview the 1MDB key-man after  more  than  a  year. Now  that  even  the  PAC  and  the  Auditor-General  have both indicted Datuk Shahrol Halmi over the gross mismanagement of 1MDB, what else is the Inspector-General of Police (IGP), Tan Sri Khalid Abu Bakar waiting for?

The IGP is after all famous for being a Twitter-happy top cop, demanding instant arrests and questioning  of  witnesses  and  suspects  over  the  most  trivial  of  alleged  offences  like “insulting” a  leader. Why  is  Tan  Sri  Khalid  Abu  Bakar  taking  his  own  sweet  time  over  what has been internationally recognised “the heist of the century”?

We  call  upon  the  Royal  Malaysian  Police  to  act  with  the  necessary  haste  and  urgency  to ensure  that  the  culprits  behind  the  RM50  billion  monster  scandal  are  quickly  brought  to justice. The  failure  by  the  Police  to  act,  and  the  irony  of  the  speed  of  investigations
overseas will only lead Malaysians to conclude that they are doing their utmost best to cover up the heinous crime involving the most powerful political figures in the country.

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Kenyataan Media Ahli-Ahli Jawatankuasa Kira-Kira Wang Negara yang Mewakili Pihak Pembangkang Parlimen Mengenai Laporan PAC Terhadap 1MDB

1. Laporan Ketua Audit Negara di bawah Akta Rahsia Rasmi

Dalam mesyuarat Jawatankuasa Kira-kira Wang Negara (PAC) semalam, isu sebab Laporan Ketua Audit Negara berkenan 1MDB tidak dibentangkan kepada Parlimen telah dibincang.

Ahli-ahli Parlimen PAC pembangkang yang hadir telah menegaskan bahawa Ketua Audit Negara hanya meminta Laporan Ketua Audit Negara dirahsiakan secara rasmi sehingga Laporan PAC dibentangkan.  Pendirian ini juga telah diakui oleh Pengerusi PAC, Datuk Hasan Arifin dalam kenyataan media beliau pada 7 Mac 2016.

Akan tetapi, Pengerusi PAC telah menyatakan pendirian yang berbeza semalam bahawa hak untuk deklasifikasi Laporan Ketua Audit Negara adalah dengan pihak eksekutif kerajaan dan tidak dengan PAC.

Beliau hanya akan menulis surat kepada pihak eksekutif untuk bertanya sama ada mereka akan deklasifikasi Laporan tersebut.

Kami berpendapat bahawa kuasa untuk membentangkan Laporan Ketua Audit Negara terletak dengan PAC, kerana Laporan PAC kami sendiri telah memetik maklumat-maklumat secara langsung daripada Laporan Ketua Audit Negara.

Apatah lagi, kami berpendapat bahawa tiada sebarang maklumat yang terkandung di dalam Laporan Ketua Audit Negara mempunyai unsur-unsur yang akan menjejaskan keselamatan negara yang perlu dirahsiakan.

Kami amat menyesali pendirian Pengerusi PAC yang telah melepaskan kuasa jawatankuasa Parlimen yang bertanggungjawab untuk menjadi institusi semak dan imbang kepada kerajaan, kepada pihak eksekutif kerajaan.

2. Surat Bank Negara Malaysia kepada PAC bertarikh 6 April 2016

Kami amat terkejut apabila Menteri dalam Jabatan Perdana Menteri, Datuk Azalina Othman menjawab dalam parlimen bahawa Pengerusi PAC telah menerima sepucuk surat daripada Timbalan Gabenor Bank Negara yang tarikh 6hb April 2016.  Kami tidak pernah dimaklum oleh Pengerusi PAC sebelum ini mengenai surat tersebut.

Menurut Menteri, surat ini menjadi alasan kepada Datuk Hasan Arifin untuk membuat keputusan meminda Laporan PAC yang telah diluluskan oleh mesyuarat PAC pada 4hb April 2016.  Oleh sebab itu, ayat-ayat yang menyebut bahawa Bank Negara telah mengesahkan bahawa syarikat Good Star Limited adalah dimiliki oleh seorang individu yang tiada kaitan dengan Petrosaudi International Limited telah dipotong daripada Laporan PAC tanpa sebarang rundingan dengan ahli-ahli PAC.

Kami telah meminta supaya Pengerusi PAC menunjukkan surat tersebut kepada semua ahli-ahli PAC semalam.

Sekali lagi, kami terkejut apabila Datuk Hasan enggan menunjukkan surat tersebut kepada ahli-ahli jawatankuasa walaupun surat tersebut telah ditulis kepada Pengerusi PAC bagi pihak seluruh jawatankuasa.

Surat yang bertarikh 6hb April tersebut adalah balasan kepada soalan-soalan yang telah dibangkitkan oleh pihak PAC pada 4hb April dan diputuskan supaya Pengerusi menulis kepada Bank Negara untuk mendapat penjelasan selanjutnya.

Keengganan Datuk Hasan untuk mengedarkan surat rasmi tersebut kepada ahli-ahli PAC merupakan kali pertama dalam sejarah PAC di mana maklumat yang telah diterima oleh Pengerusi PAC tidak dikongsikan dengan ahli-ahli jawatankuasa.  Tindakan beliau merupakan satu penghinaan kepada ahli-ahli PAC yang dilantik oleh Parlimen sendiri.

Ini telah membangkitan perasaan kecurigaan terhadap Datuk Hasan, sama ada beliau sengaja menyembunyikan surat tersebut supaya maklumat-maklumat penting yang akan membuktikan penyelewengan antara 1MDB dan Good Star Limited tidak didedahkan.

Kami meminta supaya kalau benar-benar tiada “cover up” berlaku, surat tersebut yang merupakan satu dokumen yang perlu dinilai oleh PAC mesti ditunjuk kepada ahli-ahli jawatankuasa dengan serta-merta.

Dikeluarkan oleh:

Tan Seng Giaw, Timbalan Pengerusi PAC
Datuk Kamarul Baharin
William Leong
Datuk Takiyuddin Hassan
Tony Pua

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Why can’t the Auditor-General’s Report on 1MDB be tabled in Parliament and made public similar to other A-G Reports?

The Minister in the Prime Minister’s Department, Datuk Azalina Othman said that “there is no need for the government to present the auditor-general's final report on 1MDB to Parliament”.  She said this was because the Public Accounts Committee's (PAC) report on 1MDB had been tabled to Dewan Rakyat.

"The auditor-general's report was discussed in PAC before it concluded its report," she responded to the Parliamentary question from the Member of Parliament for Kuala Kedah, Azman Ismail yesterday.

In another reply to the Member of Parliament for Raub, Datuk Mohd Ariff Sabri, she said that "the auditor-general's report on 1MDB was classified under the OSA to ensure there was no leakage of information throughout the PAC proceedings.  The auditor-general report was specifically meant for PAC.”

The responses by the Minister in the Prime Minister’s Department demonstrate the entrenched culture of secrecy and opacity to cover up the shenanigans which are linked to the top political leadership of UMNO and Barisan Nasional.

Just because the PAC tables its own findings and conclusions on 1MDB, it does not mean that the Auditor-General’s Report cannot be tabled as an appendix as well.  On the contrary, the PAC Report makes numerous references to the Auditor-General’s Report which will necessitate the tabling of the latter as an appendix to provide the Malaysian public with all the relevant information and evidence with the complete picture.

While we concede that the OSA was used to “ensure there was no leakage of information throughout the PAC proceedings”, the fact that the proceedings have ended means that the AG Report should be immediately declassified.  It is no longer necessary for the Cabinet to maintain its OSA status.

In fact, the Auditor-General has also tabled its regular reports on its audit of selected Government departments yesterday to both the Parliament and the PAC.  The latest edition of the report exposed continued multi-billion ringgit of abuses and wastages by various Government ministries and departments.

For example, there was mismanagement of RM312 million disaster relief fund for flood victims, the RM2.23 billion “River of Life” project and the RM1.42 billion Solid Waste Disposal sites.

If these “departmental” abuses can be tabled in Parliament prior to the PAC even conducting further investigations on the respective problematic projects, why is there a special need for secrecy for 1MDB, which is merely another Ministry of Finance subsidiary? Or is it?

Is it because the Auditor-General’s Report will incriminate the Finance and Prime Minister himself, Dato’ Seri Najib Razak and hence the desperate attempts by the Executive to ensure that the Auditor-General’s Report cannot even be tabled to Parliament and will never see the light of day?

However, if Dato’ Seri Najib Razak feels such allegations are unfair and are designed to malign his reputation, and that he has absolutely nothing to hide, then he should immediately order the Auditor-General’s Report to be declassified immediately.

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Is RTM not interested in hosting the debate between Arul Kanda and myself now because 1MDB has been proven to be lying to Malaysians all along?

Yesterday, I had called upon the Communications and Multimedia Minister, Dato’ Seri Salleh Keruak to once again offer RTM to broadcast the debate between Arul Kanda and myself “live”. Last October, the Minister was very quick and eager to offer the platform for the debate last October.

However, I’m extremely disappointed that the Minister has rejected the opportunity to telecast the debate live to all Malaysians throughout the country.

Dato’ Seri Salleh Keruak said that “we are not interested as investigations conducted by the Public Accounts Committee (PAC) and the Auditor-General have been concluded. If anyone is interested to debate on it, they can do so in the Parliament… What's going on now is more of a business dispute between 1MDB and the International Petroleum Investment Co (IPIC).”

The excuse provided by the Minister does not make any sense. Now that the PAC Report on 1MDB has been tabled to Parliament, it is all the more important for the findings to be debated.

This is especially since all Cabinet members claimed that the PAC Report has apparently cleared all wrongdoings by the Prime Minister and 1MDB. On the other hand, critics like myself who is part of the PAC clearly sees the report as damning, particularly with the respect that 1MDB has refused to cooperate fully with the Auditor-General.

Dato’ Seri Salleh’s claim that the massive US$3.5 billion bond defaults by 1MDB is “more of a business dispute between 1MDB and IPIC” is even more unbelievable. 1MDB has recorded the highest borrowin defaults by any government company in the history of the country, and this is a crisis of epic proportions which must be addressed by both 1MDB and the Government.

The live debate between Arul Kanda and myself will enable Malaysians to decide for themselves who is telling the truth and who is hiding from the truth. The refusal by the Communications and Multimedia Minister from hosting the show this time round is clearly a refusal to expose the truth to ordinary Malaysians.

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Malaysians are unable to confirm fraud in 1MDB precisely because Dato’ Seri Najib Razak is hampering investigations

Dato’ Seri Najib Razak claimed in his parliamentary reply as the Finance Minister to the Member of Parliament for Bagan, Lim Guan Eng, that it's still too early to conclude if fraud had occurred in the US$3.5 billion transaction between 1MDB and International Petroleum Investment Company (IPIC).

This was despite the fact that by 1MDB’s own admission to the Auditor-General, it has paid as much as US$3.51 billion to an “Aabar Investment PJS Limited” incorporated in the British Virgin Islands (BVI) between May 2012 to January 2015.  IPIC has disclosed last month that the BVI-incorporated entity is completely unrelated to itself or its similarly named subsidiary, Aabar Investment PJS, incorporated in Abu Dhabi.

It is now public knowledge that the BVI-Aabar has been wound up in mid-2015 and no one knows where the US$3.51 billion paid by 1MDB has gone to.  IPIC has publicly denied that it received any of the funds and has called a default on the debt-asset swap agreement with 1MDB signed in May 2015.

Even 1MDB President, Arul Kanda conceded that “what we cannot discount is there could actually be fraud...a massive fraud...and maybe there was collaboration from our side”.

The shocking loss of US$3.51 billion of funds would have justified the mobilisation of all investigation resources to uncover the truth behind the missing funds.  However, all we got was a nonchalant response from the Finance Minister himself that “it’s still too early to conclude if fraud has occurred”.

The problem is 1MDB hasn’t even filed a police report for an investigation to take place to uncover Arul Kanda’s concern that there “could actually be fraud… a massive fraud” and even “collaboration” from 1MDB’s officers.

And worse, even where some form of investigation was taking place by the Auditor-General (AG) and the Public Accounts Committee (PAC), 1MDB has failed to provide full cooperation.

For example, 1MDB refused, despite repeated request by the AG and the PAC over the period of nearly a year, to hand over its bank statements of its overseas accounts, and that of its overseas subsidiaries.

When I posed the question to the Finance Minister, Dato’ Seri Najib Razak only responded lamely in his Parliamentary reply that “all documents in 1MDB’s possession and/or those which were accessible and/or those which it was able to obtain has already been handed over to the National Audit Department”.

Dato’ Seri Najib Razak failed to address the question as to why 1MDB could not have the bank statements re-issued by the respective banks, if the original statements were no longer in the company’s possession.

Surely, the Finance Minister would know that missing bank statement could easily be re-printed within a few days at the most?

Hence not only did Dato’ Seri Najib Razak fail in his responsibility to ensure that the wholly-owned Ministry of Finance subsidiary comply fully with all the request by the AG and the PAC, the fact that he is now defending 1MDB with the lamest of excuses only goes to prove that the Prime Minister himself is covering up the single-largest fraud in Malaysia’s history.

By withholding crucial evidence to the investigating authorities, fraud then cannot be proven and Dato’ Seri Najib Razak can then continue to hold his head high, maintain a straight face and claim that “it is too early to conclude if fraud had occurred” in the US$3.51 billion payment to the bogus BVI-Aabar.

Malaysians cannot be blamed for asking why Dato’ Seri Najib Razak is trying to protect the criminals behind this heinous heist of the century.

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Datuk Azalina Othman lied in Parliament that the PAC Chairman informed or showed its members Bank Negara letter stating that information provided to the PAC was confidential

Datuk Azalina Othman, in her response to a question posed by the Member of Parliament for Bagan, Lim  Guan  Eng,  claimed  that  the  PAC  Chairman  Datuk  Hasan  Arifin  has  received information from Bank Negara (BNM) which claimed that the information provided by BNM was “confidential” and not meant to be used for the court of law or for public consumption.

"Pengerusi  PAC  (Datuk  Hasan  Arifin)  menerima  maklumat  daripada  Bank  Negara Malaysia  yang  menyatakan  bahawa  segala  maklumat  yang  diberi adalah  berstatus 'sulit bagi tujuan risikan sahaja dan bukan untuk kegunaan mahkamah atau laporan awam." 

She  further  claimed  that  PAC  members  have  been  informed  of  the  above  letter  from  the Deputy BNM Governor.

“Untuk  makluman,  semua  anggota  PAC  telah  dimaklumkan  mengenai  perkara  ini melalui  surat  Pengerusi  PAC  kepada  Timbalan  Gabenor  Bank  Negara  bertarikh  6 April.”

Let me state in unequivocal terms that Datuk Azalina Othman’s reply is at best misleading, at worst an outright lie with regards to the above matter.

The PAC had its final meeting which approved the final PAC Report on 1MDB for publication on 4 April 2016.  The report was tabled in Parliament 3 days later on the 7 April.

Datuk Hasan Arifin never at any point of time communicated with the PAC members on any developments  subsequent  to  the  meeting  on  the  4  April.    Hence  PAC  members  were shocked to discover upon perusing the tabled report that two crucial lines in the report was deleted unilaterally by the PAC Chairman.

The deleted lines quoted an earlier Bank Negara clarification letter to the PAC, which stated that Good Star Limited, a  recipient of US$1.03 billion of 1MDB funds meant for the latter’s investment  with  Petrosaudi  International  Limited,  was “a  company  owned  by  an  individual unrelated to Petrosaudi International”.

The  deleted  lines  clearly  indicate  a  brazen  case  of  misappropriation  by  1MDB  which  also proves  the  allegations  made  by  the  1MDB  critics  such  as  The  Sarawak  Report,  The  Edge, The Wall Street Journal and opposition critics.

The  question  then  is,  what  exactly  are  the  damaging  contents  of  this  letter  dated  6  April which is so “confidential” and cannot be shared with the public?

What  is  even  more  interesting  however,  is  how  come  the  Minister  in  the  Prime  Minister’s Department is privy to a letter from the Deputy Bank Negara Governor to the PAC Chairman dated 6 April when the members of the PAC are completely clueless above the matter?

Is there now a collusion between the PAC Chairman and the Prime Minister’s Department to cover  up  the  entire scandal  by scheming  a  coordinated  response  to  the  clear  cut  abuse  of power by Datuk Hasan Arifin?

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Why doesn’t the Government just stop all Malaysians from travelling overseas since it does not have to give any reason under the Immigration Act?

I  am  disappointed  that  former Public  Accounts  Committee  Chairman,  Datuk  Nur  Jazlan  has decided  that  there  is  absolutely  no  need  for  the  Government  to  be  transparent  and accountable for its decisions.

The Deputy Home Minister Nur Jazlan Mohamed said the government need not have to give reasons for barring Bersih chairperson Maria Chin Abdullah from leaving Malaysia.He told reporters  that “it's  a  power  given  under  the  Immigration  Act,  we  don't  need  to  explain why... We are not compelled to give a reason.”

Even  if  it  is  true  that  the  law  gives  the  Government  such dictatorial  rights,  a  Government who  prides  itself  on  transparency  and  accountability  will nevertheless  attempt to justify  its actions.

The  lack  of  such  transparency  and  accountability  only  points  to  a  Government  which  is intent on abusing its powers to repress its critics and dissidents.  Maria Chin was on the way to  South  Korea  to  receive  the  prestigious Gwangju  Prize  Human  Rights  Award,  an  award previously bestowed upon Aung Sang Suu Kyi and Xanana Gusmao.

At  the  same  time,  even if  a law  grants  the  authorities the relevant  discretion  to  exercise its powers, such discretion under any democratic regime governed by the rule of law must be exercised  reasonably. Such  discretion  were  never  meant  to  be  abused  according  to  the authorities’ whims and fancies.

I have been barred from leaving the country since 24 July 2015.  The Government and the Director of Immigration  had  similarly  refused  to  provide  me  with  any  reason  as  to  why  I have been barred from leaving the country.

It  was  only  when  the  decision  was  challenged  in  court  that  the  Director  of  Immigration provided  an  affidavit  which  disclosed  that  I  have  had  my  travel rights  restricted  because  I was allegedly  under  police  investigations  for “activities  detrimental  to  parliamentary democracy" which carries up to a 20-year prison sentence.

Even  so,  I  have  only  been  called  in  for  questioning  by  the  Police  as  a  witness  for  their investigations and have never been informed by any parties that I was ever a suspect.

Hence the Government’s crude attempts to restrict our travel rights are outrageous abuse of power, which only serves to prove the critics allegations of Malaysia transforming itself to be police state run by a tin-pot dictatorship.

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Singapore investigations shifts focus back to the clandestine operations of former 1MDB subsidiary, SRC International

Investigations by Singapore authorities have revealed that Ministry of Finance subsidiary, SRC International managing director Nik Faisal Ariff Kamil approved the transfer of US$11.95 million (RM48 million) of the company's funds to Jho Low's associate Tan Kim Loong.

Tan, according to The Wall Street Journal, is the original beneficiary of British Virgin Islands-based Tanore Finance, which had sent US$681 million to Prime Minister Najib Abdul Razak's personal bank accounts.

Singapore’s Business Times reported that the latest charge against former BSI banker Yeo Jia Wei was for facilitating, through fraudulent means, the transfer of US$11.95 million from SRC International to Affinity Equity International Partners Ltd, a company owned by Tan.

As international investigations begin to provide a clearer and more detailed picture of the scale of embezzlement via duplicitous transactions by 1MDB and SRC International, investigations in Malaysia on the other hand, have effectively ground to a halt.

While the focus of the international press and local critics have been aimed at the debt-ridden 1MDB, its former subsidiary SRC International has been kept relatively under the radar. However, if 1MDB was found by the parliamentary Public Accounts Committee (PAC) to have suffered from gross mismanagement, then stranger and more suspicious transactions have taken place in SRC International.

First of all, given all the shenanigans which took place in SRC International including the latest disclosure in Singapore, and the known fact that Nik Faisal has disappeared off the face of Malaysia for nearly a year, why is Nik Faisal still a Director and the Managing Director of the company?

Secondly, his fellow director, Datuk Suboh Mohd Yassin has also similarly disappeared from the country. Why have they not been replaced by Ministry of Finance officials? With a Federal Government guaranteed RM4 billion loan from the Malaysian Pension Fund (KWAP), who exactly is running the company today? Or is the company being run via remote control by fugitives?

Thirdly, the Attorney-General has confirmed that RM27 million originating from SRC International found its way into Dato’ Seri Najib Razak’s personal account in July 2014. The Wall Street Journal has further alleged that another RM42 million from SRC International was transferred via intermediaries into the Prime Minister’s account between December 2014 and March 2015.

The Attorney-General said no charges will be filed against the Prime Minister for criminal breach of trust on the amazing excuse that the Prime Minister did not know that the tens of millions deposited into his account came from SRC International. However, in that case, why haven’t those involved in SRC International been investigated and charged for siphoning funds to the Dato’ Seri Najib Razak’s personal account?

Fourthly, the Sarawak Report has earlier exposed that Nik Faisal was given a power of attorney to manage Dato’ Seri Najib Razak’s personal account – a damning allegation which has not been denied by the Prime Minister. Would this be a reason why Nik Faisal is given special protection by the powers that be?

Finally, while it is no longer denied that Dato’ Seri Najib Razak received at least RM69 million from SRC International, even if it was unwittingly received, why hasn’t the funds been returned to SRC International?

If the Prime Minister really did not realise then that the RM69 million deposited into his personal bank account came from SRC International, shouldn't he return the money immediately? If Dato’ Seri Najib Razak could be so honest as to return some US$620 million of unutilised donation to his mysterious alleged Arab donor, why could he return the paltry RM69 million?

Dato’ Seri Najib Razak, who is also the Finance Minister, must answer these crucial questions pertaining to SRC International during two-week Parliamentary sitting commencing tomorrow.

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DAP Selangor has taken necessary actions and filed a report against Loh Chee Heng, state assemblyman for Telok Dato to the MACC

The DAP Disciplinary Committee has notified DAP Selangor that Telok Dato state assemblyman, Loh Chee Heng has been expelled from the party with immediate effect today.

DAP Selangor had earlier received complaints from its members of alleged improprieties carried out by its state assemblyman for Telok Dato, Loh Chee Heng with regards to his constituency allocations. We have set up a sub-committee which has investigated the relevant complaints over the past 8 weeks.

The findings of the subcommittee were presented to the DAP Disciplinary Committee.

At the same time, based on our findings, DAP Selangor had filed a report with the Malaysian Anti-Corruption Commission (MACC) for their further investigation. The report was filed with MACC Selangor in Shah Alam on Wednesday, 11 May 2016.

DAP Selangor would like to reiterate the Party’s commitment in upholding our core values in promoting good governance, integrity  and  accountability. We will not tolerate any actions by any of its leaders or members which betrays the trust of the people we seek to represent and destroy the credibility of the Party.

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Dato' Seri Najib Razak must explain how his stepson, Riza Aziz could amass such enormous wealth which WSJ now attributes to be sourced from 1MDB

Riza  Aziz  acquired  a  US$33.5  million  7,700-square-foot  duplex  in  the  Park  Laurel condominium tower overlooking New York’s Central Park and an 11,000-square-foot walled mansion in Beverly Hills with a 120-foot-long pool for more than $17.5 million in 2012.

These property transactions worth US$51 million (RM204 million) was first exposed by The Sarawak Report in December 2013. They were subsequently confirmed by Riza Aziz himself to the New  York  Times,  in  a  story  entitled “Jho  Low,  Well-Connected  in  Malaysia,  Has Appetite for New York”, published in February 2015.

However  yesterday,  for  the  first  time,  The  Wall  Street  Journal  made  the  allegation  which Malaysians  have  suspected  all  along, that  the  source  of  funds  for  the  above  purchases originated from the controversial debt-ridden 1Malaysia Development Bhd (1MDB).

The global financial daily reported that investigators believe that money used to buy the two properties  was  part  of  at  least  $238  million that was transferred to an offshore company wholly owned by Riza Aziz, Red Granite Capital from Aabar Investments PJS Ltd. The funds were transferred  directly and indirectly via  intermediaries  in  batches  of  US$133 million, US$60 million, US$45 million and US$50 million throughout 2012.

Based  on  information  1MDB  provided  to  the  Auditor-General  which  was  cited  in  the  Public Accounts Committee (PAC) Report on 1MDB, the company had paid the British Virgin Islands (BVI)-incorporated Aabar Investment PJS Ltd US$567 million and US$790 million in May and October 2012 respectively as “refundable security deposits”. 1MDB had further paid the BVI-Aabar US$2.143  billion  between  September  2014  to  January 2015  purportedly  for “options termination compensation” and “top-up security deposits”.

However,  Aabar  Investment  PJS  Ltd  which  has  already  been  liquidated,  has  recently  been exposed as a fraud when the parent of the real Aabar Investment PJS incorporated in Abu Dhabi, International Petroleum Investment Corporation (IPIC) officially denied any ties with the similarly named BVI company.

According to The Wall Street Journal, the new documents also show that $60 million of the total received  by  Red  Granite  Capital  was sent  on  the  same  day  that  1MDB sent the $790 million to Aabar in the British Virgin Islands.

Dato’ Seri Najib Razak had told The New York Times previously that he “does not track how much Mr.  Aziz  earns  or  how  such  earnings  are  reinvested.” As  for  the  prime minister himself, the Prime Minister said he had “received inheritance.”

Such  tenuous  reply,  already  incredulous  in  the  first  place, can  no  longer  justify  Dato’ Seri Najib Razak’s continued silence on his stepson’s spending spree in the United States.

The  Wall  Street  Journal  previous  allegations  such  as  the  billions  of  dollars  of  1MDB  funds have  been  misappropriated  to  a  fraudulent  Aabar  Investment  PJS  Limited  have  proven themselves to be true.The latest allegation, if proven true, will show that Dato’ Seri Najib
Razak’s direct  family  members  have  benefited  at  least  hundreds  of  millions  from  the misappropriated funds to acquire outrageously priced property assets overseas.

The  Prime  Minister  must  now  show  proof  that  Riza  Aziz,  with  less  than  4  years  prior experience  as  a  junior  banker  with  HSBC  London  prior  to  founding  Red  Granite  in  2011 obtained  his  wealth  legally,  above  board  and unrelated  to  1MDB.  If  Dato’  Seri  Najib  Razak refuses  to  do  so, then  he cannot blame ordinary Malaysians who believes him to be completely guilty of corruption and abuse of power.

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Dato' Seri Najib Razak is playing the broken record by blaming 1MDB's failed IPO exercise on its critics

Prime Minister Najib Razak said a failed initial public offering (IPO) exercise, as a result of being "attacked", was the main reason why 1Malaysia Development Bhd (1MDB) encountered problems.

"When the 'attacks' were mounted, the IPO exercise could not be carried out, hence the cash flow problems," Najib said in an exclusive interview telecast live over TV1 last night in conjunction with UMNO's 70th anniversary today.

1MDB must be operating on the worst business model in the world by hedging its success or failure entirely on its ability to IPO its subsidiary. If 1MDB business collapsed just because of a failed IPO, that was probably the reason why the IPO failed in the first place.

Why were they not able to IPO? Laughably, Dato' Seri Najib blamed its failure on the critics on 1MDB. If we critics are so powerful, then we would have stopped so many other IPOs and related transactions such as Felda Global Ventures Holdings or other privatisation and fund-raising projects by the BN administration.

The real reason why the IPO failed in the first place is because 1MDB overpaid for the assets and no investors in their right minds would pay more than the RM12.1 billion 1MDB paid.  

In addition, the Government had gone out of its way to award 1MDB with multiple multi-billion ringgit new power plant contracts to boost its valuation.

However, despite the overwhelming support given by the Government, the PAC Report disclosed that 1MDB's doomed submission to the Securities Commission indicated a valuation of only RM9.86 billion to RM11.3 billion. (Page 74 of the PAC Report on 1MDB)

Hence the IPO failed because 1MDB was unable to justify the ridiculous valuation paid for its energy assets, but Dato Seri Najib chose to conveniently blame the scandal-ridden firm's critics.

The real reason as to why 1MDB has failed however, is because tens of billions of ringgit has gone missing.

For example, 1MDB had borrowed US$3.5 billion and RM6.7 billion (or an approximate total of RM20.7 billion) to acquire its RM12.1 billion worth of power plants. The question is where did the balance of the cash go?

The Auditor-General has specifically confirmed that US$7 billion of 1MDB assets and transactions overseas cannot be verified or traced. The figure includes US$1.03 billion paid to Good Star Limited, which Bank Negara has disclosed is owned by an individual unrelated to 1MDB’s joint venture partner, Petrosaudi International Limited.

Another missing US$3.51 billion has purportedly been paid to “Aabar Investment PJS Limited” incorporated in the British Virgin Islands, which Abu Dhabi’s International Petroleum Investment Corporation (IPIC) has confirmed is completely unrelated to its own subsidiary, Aabar Investment PJS.

1MDB has also failed to show any evidence that it is still in possession of US$940 million worth of unexplained “units” in BSI Bank, Singapore. In addition, US$1.56 billion worth of investments by 1MDB Global Investment Limited remains completely unaccounted for.

The fact that Dato’ Seri Najib Razak, who is also the Finance Minister has refused to address these damning issues raised by the PAC Report, but chose to give laughable excuses for 1MDB’s failure only goes to prove that he is lying to the Malaysian public.

Worse, the Prime Minister has chosen to continue making light of the situation by stubbornly refusing to explain to Malaysians if and how the Ministry of Finance will bail out 1MDB which has already defaulted on US$3.5 billion of bonds as of today.

Any Finance Minister in the world with any sense of accountability and integrity would have long resigned from his position to take responsibility for these monstrous losses.

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Deputy Finance Minister calls 1MDB's engagement with bondholders "a good move" despite its crumbling financial status

1MDB  is  now  on  the  verge  on  defaulting  on  the  interest  payments  for  its  second  US$1.75 billion bond, after defaulting on the first US$1.75 billion bond last month.

1MDB  has  been forced  to “engage”their  bondholders to negotiate  the  defaults in order to limit the financial damage to both the company and its shareholder, the Ministry of Finance (MoF).

And  yet,  under  such  dire  circumstances,  Deputy  Finance  Minister  Johari  Abdul  Ghani  can everything  is  hunky-dory,  call “1MDB's  engagement  with  its  US  dollar-denominated bondholders is a good move”.

Worse, the MoF is clearly taking a cavalier attitude to the entire financial fiasco by claiming that MoF does “not want to interfere with this because it is between two corporate entities to go and sort out their problems”.

This  must  be  one  of  the  most  irresponsible  statement  by  the  newly  appointed  Deputy Finance Minister who replaced the previous bumbling Datuk Ahmad Maslan.

The  above  bonds  were  guaranteed  by  International  Petroleum  Investment  Corporation (IPIC). However, did he overlook the fact that the MoF has provided an indemnity to IPIC for losses and damages suffered by the latter?

If  it  was  merely  a “dispute”  between “two  corporate  entities”,  then  why  did  MoF  agree  to provide the indemnity to IPIC in the binding term sheet signed between IPIC and 1MDB in May last year?

Worse, while 1MDB is forced to “engage” with bondholders to “restore market confidence”and “prevent  panic”,  what  about  ordinary  Malaysian  tax-payers  who  are  now  liable  for  a multi-billion dollar bailout of the debt-ridden 1MDB?

Doesn’t Datuk Johari see it necessary to “restore the confidence of” and “prevent panic” by Malaysians?

1MDB  has  already  defaulted  on  the  first  US$1.75  billion  bond. It  will  soon  default  on  the second US$1.75 billion bond. 1MDB has at the same time cross-defaulted on another RM7.4 billion of Islamic bonds and possibly a further RM800 million loan from SOCSO. That means that Malaysians  are  liable  to  for  US$3.5  billion  and  RM8.2  billion, or  a  whopping  total  of approximately RM22.2 billion of 1MDB’s mess.

The  above  has  yet  to  take  into  consideration  another  US$3  billion  bond  which  may  be affected at some time in the near future.

Instead of pretending that everything is A-OK, Datuk Johari must explain to Malaysians if we have to foot the bill.

He  has  earlier  promised  the  Parliament  in  December  last  year  that  the 1Malaysia Development Berhad (1MDB) will resolve “its debt and cash flow issue more quickly without help from the Government.”Is this assurance still valid?

Both  the  Prime  Minister,  Datuk  Seri  Najib  Razak  and  1MDB’s  President  Arul  Kanda  have boasted that the rationalisation exercise has been a success and has been completed. Did they both lie to Malaysians to provide a false front for 1MDB?

If  the  answers  to  the  above  questions  are  above  Datuk  Johari’s  pay-grade,  then  he  must persuade  his  boss,  Datuk  Seri Najib Razak,  who is  also  the  Finance  Minister  to  explain  the imploding 1MDB disaster to Malaysians.

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DAP’s commitment to Impian Sabah and Sarawak will continue unabated despite the outcome of the Sarawak state election

The outcome for the Sarawak state election has been a blow to both DAP’s campaign in the urban seats and our outreach to the rural constituencies.

The result has disappointed many, including party volunteers who had worked hard for the election campaign. For  the  rural  seats, some have publicly opined that a couple of our Impian Sarawak projects generated little or no returns in terms of votes.

Our supporters who have contributed generously have also voiced understandable concern over the outcome, especially upon receiving such viral reports and messages. 

Yes, it is true that in some polling districts where we have carried out projects, the electoral impact has  been  tiny  or  even  negligible. But  what  is also  true is  that  in  certain  areas, we have received a small but significant increase in support. 

Nevertheless,  any  attempts  to  measure  the  impact  of  Impian  projects  via  short-term changes in electoral support is not only premature, it is well off-the-mark.

Impian  Sabah  and  Sarawak  was  founded  with  the  specific  goal  to  bridge  the  rural-urban divide,  to  offer  basic  infrastructure,  health  and  education  projects  as  well  as  services  to uplift the quality of lives of the marginalised poor as well as to improve the understanding between the Party and the villagers.

Impian Sabah and Sarawak has been an unqualified success in its short two-and-a-half year history.   We  have  delivered  more  than  60  projects which included  the  desperately  needed gravity water feed projects, building accessible roads and generating cheap electricity. We have helped thousands of villagers achieve a better quality of life.

However, any expectation of instant transformation in perception and trust among the rural villagers after  decades  of  fear  and  prejudice  conditioned  into  their  minds  is  unrealistic. If the political mindset change in West Malaysians took decades of sacrifice and effort by our pioneering opposition leaders, why  should  we  expect  the  same  change  to  take  place overnight in rural Sarawak?

The DAP  has received  an  invaluable  better  understanding  of  the  rural  communities –  their needs, their limitations and their dreams.

Most  importantly, we  have made  many  friends in  rural Sabah  and  Sarawak. Friends whom we did not have before we embarked on the Impian journey. Without friends, and without more of them, our journey for change will never succeed. And without first appreciating the plight of the rural communities, we cannot claim to offer meaningful “change”.

The  Sarawak  election  result  is  disappointing  or  even  heartbreaking  for  some  who  put  in sweat and tears. However, it is but a bridge which we must cross to achieve our goals for a better Sarawak, and  a  better  Malaysia. Perseverance  and persistence  will  mark  the difference between a lost cause and a realisable dream. 

Therefore,  we  would  like  to  reiterate  here  that  our  commitment  to  Impian  Sabah  and Sarawak is  a  long-term  cause. Our  efforts  to  bring  change  at  both the quality of  life and political landscape for our fellow Malaysians, will continue unabated. 

We would also like to take this opportunity to thank all our supporters who have contributed immensely to the success our Impian Sabah and Sarawak projects, and we look forward to your continued support.

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In the face of 1MDB's enormous debt, Malaysians need to brace themselves for government bailout of at least RM20 billion

1. The Rationalisation Plan of 1MDB announced in May last year was always like a house built on sand. 

1MDB  noted  in  its  press  statement  this  morning  that “1MDB  now  retains  a  cash surplus  of approximately RM2.3 billion  for  infrastructure  and  other  debt  service requirements. Future debt obligations  are  fully  matched  by  the sale of Bandar Malaysia  land,  the  development  and  sale of TRX lands  as well  as  the  eventual monetisation of the Pulau Indah and Air Itam lands.”

We have always maintained that the 1MDB Rationalisation plan was built on sand as we  were  never convinced  that  the  US$4.7  billion  debt-asset  swap  plan  will  be successful. This was because it was clear from 1MDB’s financial statements and the events  which  took  place  over  the  past  year showed  that  1MDB  does  not  have equivalent amount of assets to “swap” with IPIC’s assumption of 1MDB debt.

The  lack  of  conviction  was  made  more obvious  by 1MDB’s  refusal  to  provide the Auditor-General  with  the  necessary  documents  to  verify the value  or  even the existence of 1MDB’s overseas cash and assets.

Hence  the  continued  insistence  by 1MDB  that “further  debt  obligations  are  fully matched by the sale of Bandar Malaysia land...” etc., especially after the collapse of the  IPIC-1MDB agreement  is an  irresponsible  attempt  to continue  play  a  game of smoke and mirrors.

In  addition, we  also  have  doubts  on  the  ability  of  the  Iskandar  Waterfront  led consortium’s ability  to  complete  the  purported  RM7.42  billion  for  the 60%  stake in Bandar Malaysia. Based on Iskandar Waterfront’s financial statements for December 2013, it only has net assets of RM3.46 billion.

2. 1MDB’s failure to repay US$50 million of interest will cause cross default. 

1MDB in its latest statement is also attempting to play down the impact of its default on the US$1.75 billion bond issue where it has failed to pay for the US$50 million of bond interest due.

1MDB  has  confirmed  cross  defaults  have  been  triggered  on  the 1MDB  RM5 billion Sukuk due 2039 (“1MDB  Sukuk”)  and  the  RM2.4  billion  Bandar  Malaysia  Sdn  Bhd Sukuk due between 2021 and 2024 (“BMSB Sukuk”).

1MDB  said  there  is  no  cross  default  on  an  RM800  million  loan  from  the  Social Security Organisation (“SOCSO  Loan”)  although  there  is  a  possibility  that  the “material  adverse  effect” clause  may  be  triggered  due  to  the  developments highlighted above.

1MDB further added that “the 1MDB Sukuk and the SOCSO Loan both benefit from guarantees issued by the Government of Malaysia.”

This is another obvious admission that 1MDB will be relying entirely on the Malaysian Government to bail out 1MDB in its burgeoning debt crisis. The event of default has been triggered which means that all bond holders will now have the absolute option to call upon the Malaysian Government to pay up for its debts.

The Minister of Finance cannot continue to remain silent on this matter as this is the single largest default by any Government subsidiary ever in the history of Malaysia. Dato’ Seri Najib Razak  must provide  a  full  and  satisfactory explanation  on  the financial  disaster  taking  place  before our eyes and  outline  the  steps  which  will  be taken to remedy the situation.

This is especially since 1MDB and Dato’ Seri Najib Razak has repeatedly denied any need for Government bailouts despite repeated warnings by opposition critics.

3. Malaysian  Government  will  ultimately  bear  the  burden  of  all  advances, interests and bonds guaranteed by IPIC. 

Under the debt-asset swap arrangement with IPIC, the agreement clearly states that the Ministry of Finance will indemnify IPIC of all its obligations including its advances and payments of interest on behalf of 1MDB.

What  is  further  highlighted  in  the  Public  Accounts Committee  report  (page  62),  as pointed out by  the  Auditor-General  was  that  1MDB  had  provided  a  back-to-back guarantee on IPIC’s guarantee.

“Dalam Interguarantor  Agreement  yang  ditandatangani  antara  1MDB  dan  IPIC bertarikh 21 Mei 2012, 1MDB  dikehendaki  mendapatkan  Ministry  of Finance  Inc., untuk  melunaskan  semua principal  dan  kos  berkaitan  yang  telah  didahulukan  oleh IPIC  sekiranya  1MDB  gagal melaksanakan   obligasinya  sebagai penjamin... Di samping  itu,  syarat  dalam Interguarantor Agreement  tersebut  adalah  bertentangan dengan  surat  kelulusan  daripada  Menteri  Kewangan bertarikh  26  Mac  2012  dan  3 Ogos  2012  yang  menyatakan  bahawa  terbitan  kedua-dua  Nota USD  itu  diluluskan tanpa jaminan kerajaaan.”

Hence ultimately, it is clear that 1MDB is continuing to play a poker game even after its cards have been fully revealed to be duds. The refusal to pay the US$50 million interest may force IPIC to repay the US$1.75 billion of bonds it guaranteed on behalf of 1MDB.

However, ultimately, IPIC  will  make  the  claim  on  the  Malaysian  Ministry  of  Finance based  on the  inter-guarantor  agreement. Will  Dato’ Seri Najib Razak  refuse to honour 1MDB’s  agreement with  IPIC,  the  sovereign  wealth  fund  of  the  Abu  Dhabi Government?

4. Arul  Kanda  has  finally  admitted  not  only  possible  fraud,  but  also  possible collaborators from 1MDB. 

"What we cannot discount is there could actually be fraud... a massive fraud... and maybe  there  was  collaboration  from  our  side,"  Arul  Kanda told The  Edge  Financial Weekly in a cover story interview.

Arul Kanda has finally admitted to a point we have been alleging for nearly 2 years, that  there may be  systematic  fraud,  deception  and  misappropriation  in  1MDB resulting in billions of dollar of losses.

His admission  now  requires him  to  make  a  police  report  to  disclose  what he  knows and demand the authorities to investigate the possible fraud claims. He must do so now in order to ensure that he will not be found to be complicit in the covering up the entire fraud in any subsequent investigations.

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"Nothing to hide", but PAC Chairman deletes BNM findings on Good Star Limited's ultimate beneficiary being an individual unrelated to Petrosaudi

The opposition members of the Public Accounts Committee (PAC) disclosed yesterday that PAC Chairman Datuk Hasan Arifin had deleted a key sentence/paragraph from the PAC Report on 1MDB after the report has been concluded by the committee.

This  key  section  states  that  Bank  Negara  Malaysia  has  been informed  by  the  relevant overseas authorities on a voluntary basis that the ultimate beneficiary of Good Star Limited is an individual unrelated  to  the  Petrosaudi  group. 1MDB has  made  payments of  US$700 million  and  US$330 million  in  2009  and  2011  respectively  even  though the funds  were meant for its investments with Petrosaudi.

Datuk  Hasan Arifin responded  yesterday  evening  that “the  deletion  of  two sentences in no way affects the final report by the Public Account Committee's (PAC) on 1MDB”. He said the sentences were deleted because of their unclear status or being investigated and were not for public consumption.

Firstly, if the “two sentences” were indeed inconsequential to the PAC Report, why did the Chairman find it necessary to delete them in the first place?

Secondly,  the  PAC did  not  at  any  point  empower  the Chairman  to delete  these  sentences. The fact of the matter is that the final meeting of the PAC which included members of the backbenchers and  the  opposition,  approved  the  final  draft  which  included  the  above information.

Datuk Hasan Arifin tried to defend his unilateral decision by claiming that the statement “is unclear or being investigated”, hence “is something prejudicial”.

The  PAC  Chairman  should  inform  the  Parliament  and  all  concerned,  what  exactly  is  so unclear about Bank Negara’s findings that “the ultimate beneficiary of Good Star Limited is an individual unrelated to the Petrosaudi International Ltd”?

This  finding  is  crucial  to  the  entire  investigations of 1MDB  because  the  company  and  its executives  have  testified  to  the  PAC  that  Good  Star  Limited  is  a  subsidiary  of  Petrosaudi. However,  the  company  was  unable  to  provide  any  concrete  evidence, such  as  a  company search or certificate  of  incorporation  from  the  relevant  authorities,  despite repeated requests, to back up its claims to both the Auditor-General and the PAC.

All  1MDB  could  provide  was  a  letter  dated  2015  from  Petrosaudi  to  1MDB  making  a  claim that Good Star Limited was part of the Petrosaudi group. This letter would certainly hold no water in any court of law and the PAC would make itself a laughing stock of the world if we were to accept the letter at face value.

Hence, is  the  PAC Chairman  questioning  and  challenging  the  authority  and  investigative findings of Bank Negara Malaysia?

If he is questioning the findings of Bank Negara, then why did he persistently, as recorded in the Hansard on at least 5 occasions, refused our request to call Bank Negara to testify to the PAC? Is there something that Datuk Hasan Ali is aware of, which he doesn’t want PAC members to find out?

In the light of the above, as well as the latest developments involving the complete collapse of 1MDB’s debt-asset swap agreement with IPIC, we once again call upon the PAC Chairman to call for an  immediate  PAC  meeting  and  officially  re-open  our  investigations  on  the troubled 1MDB. The  failure  to  do  so  under  the  current  circumstances  would  mean  the failure of the PAC to fulfill our duties and obligations to the Parliament and the rakyat.

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