Archive for the 'Economy' Category


“Sila Duduk, Jangan Lari” interview with Al Jazeera

In this exclusive episode of 101 East, Mary Ann Jolley interviews former Prime Minister Najib Razak and asks, what went wrong.


1MDB’s RM53 Billion Liability Malaysians have to pay


Special Report: It started on a yacht

This article first appeared in The Edge Malaysia Weekly, on June 25, 2018 – July 01, 2018.

And it led to a RM53 Billion* Liability Malaysians have to pay

The Ministry of Finance (MOF) has to set aside RM44.6308 billion from now to pay the remaining interest on four 1MDB bonds and to redeem the principal sums when they expire.

The total principal sum of the four bonds is RM31 billion, of which RM14 billion is due just four years away in 2022 and another RM12 billion in 2023. The remaining RM5.0 billion is due only in 2039.

Total interest paid on the four bonds to date is RM8.5402 billion. Total interest to be paid from now till the bonds expire is RM13.6308 billion.

By the time all the bonds are retired, MOF would have had to pay around RM 53.171 billion (based on today’s exchange rate of RM4.00 for US$1.00).

The four bonds were issued for the joint venture with PetroSaudi International in 2009, the purchase of power stations from Tanjong and Genting in 2012 and for the development of the Tun Razak Exchange in 2013.

The bulk of the money raised has been misappropriated and is now the subject of a worldwide probe and the new Pakatan Harapan government has vowed to go after all those responsible and to also try and recover most if not all of the money. Much of the stolen billions had been used by Jho Low, Riza Aziz and their Middle-Easter co-conspirators to buy assets in the United States, according to the US Department of Justice which has called the scandal the world’s biggest ever case of kleptocracy.

The two bonds arranged by Goldman Sachs to buy the power stations in 2012 were co-guaranteed by Abu Dhabi’s International Petroleum Investment Company (IPIC).

But following a dispute, Malaysia freed IPIC of its obligation under an arbitration settlement signed by Datuk Seri Najib Razak in 2015 in which MOF guaranteed that Malaysia will assume all future interest and principal payments on the two bonds.

Special Report: It started on a yacht
The Edge Malaysia
June 25, 2018


New RM9.4 billion scandal discovered in MoF ‘red files’

New billion-ringgit scandal discovered in MoF ‘red files’

PUTRAJAYA, June 5 — Suria Strategic Energy Resources Sdn Bhd (SSER) was paid RM8.3 billion from two projects worth RM9.4 billion despite only completing 13 per cent of the work, the Finance Ministry said today.

The irregularity was discovered among the ministry’s so-called “red files” that were previously restricted to a select few officials and within which was buried the full extent of the 1Malaysia Development Bhd (1MDB) scandal.

“We have discovered that the payment schedule for the above contracts is based almost entirely on timeline milestones, and not on progressive work completion milestones,” Finance Minister Lim Guan Eng said today.

“Worse, based on the agreements signed, 85 per cent of the project value would be paid by March 1, 2018.”

According to Lim, SSER was incorporated as a wholly-owned unit of the Finance Ministry in 2016 to undertake two projects: the Multi-Product Pipeline (MPP) and Trans-Sabah Gas Pipeline (TSGP).

The MPP is a RM5.35 billion project to build a 600km oil pipeline from Jitra to Port Dickson while the TSGP is a 662km gas line connecting the Kimanis Gas Terminal to Sandakan and Tawau at a cost of RM4.06 billion.

Both contracts were awarded to China Petroleum Pipeline Bureau (CPPB) in November 2016 in contracts signed by former Treasury secretary-general Tan Sri Irwan Serigar, who is also SSER chairman.

According to Lim, the Treasury was informed in March that progress for the MPP was 14.5 per cent complete and 11.4 per cent for the TSGP.

“However, RM4.71 billion has been paid to CPPB for the MPP and RM3.54 billion for the TSGP.

“This was something that is shocking to us at the Treasury,” Lim said.

Rather than payment for work completed, Lim said the compensation schedule used time-based milestones for which payment outstripped progress by several magnitudes.

He pointed out that the agreement directly negotiated by the Prime Minister’s Department during the Najib administration meant the entire project was almost completely paid for despite only being 13 per cent done.

Lim added that he was informed that a Treasury official who worked on SSER was the same one who dealt with SRC International, the former 1MDB unit under investigation over a RM42 million deposit into Datuk Seri Najib Razak’s account previously.

“The president of SSER is Datuk Mohammed Azhar bin Osman Khairuddin, who is also a company director.

“He is also on the board of Putrajaya Perdana Sdn Bhd, a company with direct ties to Mr Low Taek Jho,” Lim said, referring to the billionaire commonly called Jho Low and who is intricately linked to the 1MDB scandal.

New billion-ringgit scandal discovered in MoF ‘red files’
05 June 2018 – MMO
By Sharina Ahmad


MOF confirms Malaysia’s debt exceeded RM1 trillion

After cynicism, MOF confirms Malaysian debt exceeded RM1t

PUTRAJAYA, May 22 — Finance Minister Lim Guan Eng has confirmed that Malaysia has crossed the RM1 trillion debt threshold, as announced by Prime Minister Tun Dr Mahathir Mohamad yesterday.

Speaking to a press conference after his first day on the job, Lim said the estimated figure of RM1 trillion debt will be reviewed during the Ministry of Finance (MOF) discovery exercise.

“Yes I would like to confirm what Tun said. The debt is indeed above RM1 trillion and I think it will be reviewed during the discovery exercise when all relevant departments can start consolidating their numbers and accounts,” Lim said.

The minister however did not elaborate on his remark.

“Right now, certain accounts and files are not accessible,” said Lim referring to a group of “red files” which are only accessible to certain parties which has impeded officials and auditors from carrying out their duties to ascertain the factual condition of the nation’s coffers.

One of the first thing he did in his first day as Finance Minister was to instruct that all accounts must be accessible to the Treasury Department and the Auditor-General’s Department.

However, despite the worrying confirmation, Lim remains confident that Malaysia’s fundamentals and fiscal position remains healthy, due to a robust and well capitalised banking and financial system.

“The fundamentals of the economy remains strong. What is important is to clean up the mess left behind and I think the public know that once you clean up the mess you can only grow financially stronger.

“What we need is a vigorous and robust financial economy to put Malaysia on a higher economic level,” said Lim.

He added it is important to maintain financial health by ensuring that the nation’s current account balance remains in surplus. He also admitted that Malaysia might have to through some pain on a temporary basis until the government’s finances have been cleaned up.

Lim also said that the scandal ridden 1Malaysia Development Bhd is one of the main factors behind Malaysia’s one trillion debt.

When asked whether the country is heading towards bankruptcy, he wittily quipped that it would have been the case in the previous Barisan Nasional government but not under Pakatan Harapan’s watch.

After cynicism, MOF confirms Malaysian debt exceeded RM1t
By Azril Annuar
22 May 2018 – MMO


Mystery deepens over $3.5 billion Malaysia’s 1MDB sent to BVI entity (repost)

Mystery deepens over $3.5 billion Malaysia’s 1MDB sent to BVI entity

The mystery over who controlled a British Virgin Islands-registered company that received $3.5 billion from Malaysia’s scandal-tainted state fund 1MDB deepened on Monday when a company in the Middle East with an almost identical name said the BVI firm did not belong to it.

Abu Dhabi’s sovereign wealth fund, International Petroleum Investment Co (IPIC), and its subsidiary Aabar Investments PJS said in a joint statement the BVI firm with an almost identical name, Aabar Investments PJS Ltd, “was not an entity within either corporate group.”

They had neither received any payments from the BVI company, which was wound up last June, nor assumed any liabilities on its behalf, the statement said.

A Malaysian parliamentary committee investigating 1MDB said in a report released on Thursday that the Malaysian sovereign fund sent a total of $3.5 billion to “Aabar BVI”.

What happened to the money after it went to the British Virgin Islands could not be determined, the report said.

The 1MDB fund is solely owned by the Ministry of Finance. Malaysian Prime Minister Najib Razak, who is also finance minister, was authorized to sign off on the fund’s major transactions, according to the parliamentary report. Najib has consistently denied any wrongdoing.

The 1MDB transfers to “Aabar BVI” included about $1.4 billion from a privately placed bond that Goldman Sachs (GS.N) raised in 2012. The 1MDB fund also made payments of $855 million, $993 million and $295 million as security deposits and other guarantees for the bond to the BVI firm, the report said.

In response to IPIC’s statement, 1MDB said it was surprised that neither IPIC nor Aabar had any knowledge of payments 1MDB made to Aabar BVI.

The IMDB fund says its records show documentary evidence of the ownership of Aabar BVI and of each payment made. The statement did not say what that ownership was.

It added that legal agreements were negotiated with Khadem Al Qubaisi in his capacity as managing director of IPIC and chairman of Aabar or with Mohamed Badawy Al Husseiny, who was CEO of Aabar.

The United Arab Emirates’ central bank has ordered a freeze on the assets of Khadem and Mohamed Badawy, banking sources told Reuters last week. The reason for the freeze was unclear.


Investigators in at least five nations, in addition to Malaysia, are scrutinizing various transactions connected with 1MDB in a wide-ranging money-laundering, fraud and corruption probe.

The U.S. Justice Department has subpoenaed former Goldman Sachs banker Tim Leissner in its probe linked to 1MDB. Leissner helped 1MDB arrange two bonds in May and October 2012, valued at $1.75 billion each, which are also the focus of an inquiry by Luxembourg prosecutors.

Goldman raised a total of $6.5 billion for 1MDB between 2012 and 2013. Goldman has declined comment. Leissner, who could not be reached for comment, has not been charged with any offense.

Mystery deepens over $3.5 billion Malaysia’s 1MDB sent to BVI entity
By Stanley Carvalho and Praveen Menon
Apr 11, 2016 – Reuters


Grand larceny in 1MDB (repost)

‘Grand larceny in 1MDB’

COMMENT The might of the most powerful nation in the world has been brought to bear to investigate, uncover and institute legal proceedings to forfeit assets purchased through money stolen from proceeds of bonds sales by 1MDB.

The combined efforts of three US agencies, the Federal Bureau of Investigation (FBI), the Department of Justice and the Internal Revenue Service (IRS), with the assistance of law enforcement agencies in other countries, have produced the most complete, holistic picture of the great fraud perpetrated by Jho Low and his co-conspirators to defraud the people of Malaysia of billions of ringgit ultimately belonging to them.

The 136-page, 513-paragraph ‘Verified Complaint for Forfeiture in Rem’ is a tour de force. The people of Malaysia, suffering under a state of powerlessness and helplessness, owe an immeasurable debt to the sterling work carried out by truly independent institutions in the United States.

As a long-time critic of US domestic and foreign policies, I pay tribute to their selfless work in exposing the greatest robbery in modern times; what is the Great Train Robbery of the 1960s compared to 1MDB!

The fact that the US initiative is brought by its newly established ‘Kleptocracy Asset Recovery Initiative’ is significant. Thus their complaint asserts that Prime Minister Najib Abdul Razak is a kleptocrat, a term that was only coined in the late 1990s to describe African dictators like Joseph Mobutu, Sani Abacha and Robert Mugabe plundering their own countries.

More than US$3.5 billion in funds belonging to 1MDB were stolen, and the US complaint seeks the forfeiture and recovery of more than US$1 billion in assets purchased from that stolen money. It represents the largest single action ever brought by the Kleptocracy Initiative.

The serious allegations against Najib, his stepson, Riza Aziz and Jho Low for their corrupt dealings have shamed our nation. Through their action, Malaysia has joined the ranks of the most corrupt nations in the globe.

One could not have a more succinct description of the corrupt practices engaged by these persons than what the Complaint states in Paragraph 6:-

“6. 1MDB was ostensibly created to pursue investment and development projects for the economic benefit of Malaysia and its people, primarily relying on the issuance of various debt securities to fund these projects. However, over the course of an approximately four-year period, between approximately 2009 and at least 2013, multiple individuals, including public officials and their associates, conspired to fraudulently divert billions of dollars from 1MDB though various means, including by defrauding foreign banks and by sending foreign wire communications in furtherance of the scheme, and thereafter, to launder the proceeds of that criminal conduct, including in and through U.S. financial institutions. The funds diverted from 1MDB were used for the personal benefit of the co-conspirators and their relatives and associated, including to purchase luxury real estate in the United States, pay gambling expenses at Las Vegas casinos, acquire more than US$200 million in artwork, invest in a major New York real estate development project, and fund the production of major Hollywood films. 1MDB maintained no interest in these assets and saw no returns on these investments.”

A close reading of the comprehensive document will indicate that the draftsmen had access to thousands of incriminating materials, hardly surprising considering the reach of the FBI and IRS when the US dollar and their banking system are used for nefarious purposes. Further, the paper trail would have been immensely damning.

From their advanced state of knowledge, as demonstrated by the exhaustive nature of the civil complaint, it is only a small step for the FBI and Department of Justice (DOJ) to next take, that is, to institute criminal proceedings against the persons referred to in the complaint. Such criminal proceedings cannot come soon enough for all right thinking persons.

The US government complaint completely vindicates the brave reporting of Clare Rewcastle-Brown and the Sarawak Report, Wall Street Journal, New York Times, the Edge led by its intrepid editor Ho Kay Tat and P Gunasegaram in KiniBiz. So too the public statements of Dr Mahathir Mohamad, Tony Pua, Lim Kit Siang and Ambiga Sreenevasan.

They have been unfairly demonised by the Malaysian Establishment, for speaking the truth and an apology is due to them. And Malaysia owes a great debt to Clare Rewcastle-Brown for her single-minded investigative journalism of the very highest standard.

Because the complaint is in effect a history of the fraudulent dealings undertaken by 1MDB, under the control of Najib and Jho Low from the time of its birth, it should be read carefully. No summary can do justice to its detailed narration: the primary document must be reviewed.

‘Grand larceny in 1MDB’
Tommy Thomas
26 July 2016 – malaysiakini


1MDB SCANDAL – How $1 Billion Made Its Way to the Prime Minister (repost)

How $1 Billion Made Its Way to the Prime Minister

Investigators say at least $3.5 billion was misappropriated from 1MDB. Here’s how they believe $1 billion ended up in the bank accounts of Malaysian Prime Minister Najib Razak.

Every time Malaysian government investment fund 1Malaysia Development Bhd, or 1MDB, borrowed money, large amounts of the cash were quickly misappropriated, according to investigators. The money followed a circuitous path among private banks, offshore companies and funds, bank records show, and roughly $1 billion landed in the private bank accounts of Malaysian Prime Minister Najib Razak.

That cash is part of $3.5 billion that was embezzled from 1MDB, according to a U.S. Justice department complaint. Investigators from seven countries are trying to figure out what happened to the money and the U.S. moved to seize $1 billion in property in July, including luxury real estate in New York and Beverly Hills, a private jet and art allegedly purchased with 1MDB money. Singapore has charged a banker with money laundering in relation to 1MDB and Abu Dhabi has arrested and frozen the assets of a top official who was deeply involved with the fund. The banker and the official haven’t commented.

This interactive graphic tracks the route that investigators believe the money took from the time it was raised by 1MDB until it landed in the private bank accounts of Mr. Najib at AmBank Bhd., a Malaysian bank, between 2011 and 2015.

The money was raised on three separate occasions and took three separate paths, sometimes flowing directly, while in other cases it split and took different routes, only to be reunited in the AmBank accounts according to the Justice Department complaint. The cash flowed through Singapore, Switzerland, Saudi Arabia, Thailand, the Seychelles, the British Virgin Islands and Curaçao. Other funds disappear, often into accounts controlled by other players in the scandal, the complaint said.

This description is based on bank-transfer documents, investigative files from two countries, people familiar with transactions and the 136-page Justice Department complaint, which is seeking to seize assets bought with funds misappropriated from 1MDB.

Mr. Najib hasn’t acknowledged all of the transfers into his accounts, but he said that $681 million was a legal donation from the royal family of Saudi Arabia and the Malaysian attorney general agreed with that explanation, clearing him of any wrongdoing. Mr. Najib said he returned most of the funds to the Saudi Arabian donor. 1MDB has denied wrongdoing and said it would cooperate with any lawful international investigation.

According to the Justice Department, the money went back to the offshore company that originally sent it to Mr. Najib’s accounts, and from there it was used to fuel other investments and spending by a Malaysian financier allegedly at the center of the scheme named Jho Low. A lawyer for Mr. Low declined to comment.

A portion of the money from 1MDB passed through Saudi Arabia on its way to Mr. Najib’s accounts and $80 million appears to have been transferred by the Ministry of Finance in Saudi Arabia. The origin of the rest of the Saudi money is still under investigation.



1MDB borrowed about $1.8 billion for a joint venture with Saudi oil company PetroSaudi International Ltd.


About $1 billion of the cash went to a Seychelles company called Good Star Ltd.


A co-founder of PetroSaudi, Prince Turki bin Abdullah, received $24.5 million from Good Star before transferring $20 million to Mr. Najib via an intermediary, according to the Justice Department and a person familiar with the U.S. investigation into 1MDB. The same intermediary sent other funds into Mr. Najib’s accounts, bank transfer documents show, but the origin of the funds is still under investigation. PetroSaudi, Prince Turki and Prince Faisal did not respond to requests for comment.



Two bonds worth a total of $3.5 billion were sold for 1MDB by Goldman Sachs to fund the purchase of power plants.


After paying a substantial fee to Goldman, 1MDB was supposed to pay money for a guarantee on the bonds to a unit of Abu Dhabi’s International Petroleum Investment Company called Aabar Investments PJS. Instead, the funds went to the similarly named Aabar Investments PJS Ltd., a British Virgin Islands registered company that IPIC says isn’t part of its corporate structure, which received billions of dollars from 1MDB entities over the years. The money was then distributed to beneficiaries of the alleged fraud, according to the Justice Department.


From Aabar BVI, about $637 million went to a company called Blackstone Asia Real Estate Partners in the British Virgin Islands, where it was pooled with other funds. Blackstone has no connection to the Blackstone Group, the New York private-equity firm.

Another $463 million went from Aabar BVI to two mutual funds in the Caribbean island of Curaçao and then onto Blackstone Asia Real Estate Partners, which transferred a total of $170 million to Mr. Najib’s bank accounts in multiple transactions during 2012, bank transfer documents show.



1MDB sold $3 billion in bonds via Goldman Sachs to fund a real-estate joint venture with Abu Dhabi.


Immediately after paying Goldman Sachs its substantial fees, 1MDB transferred nearly half of the cash to a series of funds, shell companies and other intermediaries located in the British Virgin Islands and Curaçao. Eventually $1.27 billion ended up in a British Virgin Islands company called Tanore Finance Corp.


Tanore transferred $680 million to Mr. Najib’s accounts. A few months later, $620 million was returned to Tanore before disappearing back into a maze of offshore companies, according to the Justice Department and investigative documents reviewed by the Journal.



Of the $1.05 billion Mr. Najib received in his accounts, only $80 million appears to clearly originate with Saudi Arabia, via its Finance Ministry, though the details of that transfer are still unknown. Another $120 million that came via an intermediary based in Saudi Arabia are still under investigation, according to a person familiar with the U.S. investigation. At least $20 million of that $120 million has been traced clearly back to 1MDB by investigators. The remaining $850 million came via Tanore Finance and Blackstone Asia, and has been traced back to 1MDB by investigators, according to people familiar with the probe.


Mr. Najib used the money in his AmBank accounts for personal and political spending, according to investigative documents reviewed by the Journal that detail more than 500 transactions. He wrote checks to politicians in his political party and also paid millions of dollars for personal expenses, including $130,625 at a Chanel store in Hawaii and €750,000 at a jewelry store in Switzerland.

How $1 Billion Made Its Way to the Prime Minister
By Bradley Hope, Tyler Paige, Will Welch, Maryanne Murray and Chris Canipe
Wall Street Journal
Sept. 1, 2016

The dawn of A Better Malaysia!
Rafidah Aziz, Hannah Yeoh, Ambiga at TTDI ceramah


Mahathir in Putrajaya ceramah


What happened to 1MDB’s money? – CNBC Video
Nuclear lessons for Malaysia (Part 1) (Part 2)
BN govt is directing attention to distant past and distant future, in order to distract people from present misdeeds and poor governance
Felda - A picture is worth a thousand words
How the 1MDB Scandal Spread Across the World (WSJ)
We cannot afford ridiculously expensive RM55 Billion ECRL!
All that is necessary
for the triumph of evil
is for good men
to do nothing.

- Edmund Burke
When the people
fears their government,
there is TYRANNY;
when the government
fears the people,
there is LIBERTY.

- Thomas Jefferson
Do you hear the people sing?