Archive for the 'Financial' Category


1MDB case must be watertight, says Malaysia’s Mahathir as Najib rumours swirl

1MDB case must be watertight, says Malaysia’s Mahathir as Najib rumours swirl

The Malaysian government is taking time to build a watertight case in the 1MDB financial scandal and not be swayed by populist sentiment, according to Prime Minister Mahathir Mohamad.

His predecessor Najib Razak is the prime suspect under investigation and has been banned from leaving the country. This week, Najib’s decision to go on holiday to the resort island of Langkawi – which coincidentally is the parliamentary seat of Mahathir – sparked fears he was trying to slip out of Malaysia.

The government and the people know that billions have been stolen, Mahathir said. But, calling for cool heads, Mahathir said in an interview with the South China Morning Post that the government wanted indisputable evidence. “So the prosecutors now are gathering that evidence so that when they go to the court of law, the judges don’t base their judgment on sentiment, but … on facts and evidence shown in the court of law. So that is why we are taking a little bit more time than we expected.”

He declined to give a timeline on the next stage of the investigations, even as speculation swirled in Malaysia that the charges could be filed against Najib as soon as the next two weeks.

But on Tuesday afternoon, he was quoted as saying that charges would be filed on key suspects – Najib, businessman Jho Low and “a few others” – within months, while a trial would begin later this year.

Charges against Najib would include “embezzlement, stealing government money, and a number of other charges,” he said in the interview with Reuters.

The 1MDB probe extends across six jurisdictions, including the United States, Switzerland and Singapore. It has also targeted Najib’s wife, Rosmah, known for her flagrantly ostentatious taste in luxury goods. Set up in 2009 as an infrastructure fund drawn from oil revenues, it has lost US$4.5 billion and is now insolvent. Around US$731 million allegedly ended up in Najib’s personal account. The beleaguered former premier has denied any wrongdoing, insisting that the money was a donation from an Arab benefactor.

1MDB case must be watertight, says Malaysia’s Mahathir as Najib rumours swirl
By Zuraidah Ibrahim, Bhavan Jaipragas
19 Jun 2018 – SCMP


The disintegration of BN

The disintegration of BN – from 13 parties to four

The once-exalted Barisan Nasional (BN) entered the 14th general election with 13 parties but in just a month since its disastrous defeat on May 9, the coalition has disintegrated and is left with only four parties with another in dispute.

Founded in 1973, BN was an initiative by the second prime minister Abdul Razak Hussein to bring both ruling and opposition parties together following a painful period for the country – the 1969 riots.

However, BN has today unravelled at the hands of his son and sixth prime minister Najib Abdul Razak who insisted on leading the coalition despite being plagued by the 1MDB scandal, a multi-billion dollar corruption behemoth described as “kleptocracy at its worst”.

On May 9 this year, BN – successor to the Alliance – lost power for the first time in 61 years since independence in 1957.

This article provides a timeline of the disintegration of the BN and how its former partners are re-aligning. It also looks at the remaining parties within BN.

Sabah BN

Going into the 14th general election, Sabah BN comprised Umno and state-based parties PBS, PBRS, Upko and LDP.

Immediately after BN’s defeat at both the state and federal level in Sabah, Upko was the first to announce its exit from BN.

The party then joined forces with the opposition Pakatan Harapan and Warisan, giving them the needed majority to form the new Sabah state government.

This was followed by LDP, PBS and PBRS’ exiting from Sabah BN, effectively leaving Umno as the only major component of the coalition in Sabah.

A large group of Sabah Umno state assemblypersons also quit the party to join PBS in a bid to develop a more “local image”.

PBS, meanwhile, allied itself with Star, another opposition party, to form Gagasan Bersatu.

All this took place within the first week of BN’s defeat.

What is left of Sabah BN is a weakened Umno and a few peninsular-based parties.

MCA and Gerakan have a presence in Sabah but they were never considered as core members of Sabah BN.

Sarawak BN

In contrast to Sabah, Sarawak BN had an orderly exit from the coalition with all of its state components remaining intact.

Under the leadership of Sarawak chief minister Abang Johari Openg, PBB, SUPP, PRS and PDP announced their exit from the coalition today.

The four parties announced that they will now form a state-based coalition named Gabungan Parti Sarawak (GPS).

Johari said the coalition will work with the Pakatan Harapan federal government but will form its own bloc and remain on the opposition side in Parliament.

BN in Peninsular Malaysia

The only parties left in BN are Umno, MCA, MIC and Gerakan.

A power struggle ensued in MyPPP with its president M Kayveas announcing on May 19 that the party was exiting BN.

However, his other supreme council members disputed this, leaving MyPPP’s true status with BN in limbo.

While MCA, MIC and Gerakan remain in BN, for the time being, they have indicated that they will review their position in the coalition as part of a post-general election reform.

Umno – the anchor of BN – now has few friends to count among its ranks, and may need to look for new allies.

The disintegration of BN – from 13 parties to four
12 June 2018 – malaysiakini


Najib Signed Off Hundreds Of Millions On ‘Scam’ Solar Project For Sarawak Schools

Najib Signed Off Hundreds Of Millions On ‘Scam’ Solar Project For Sarawak Schools

Sarawak Report has viewed copious documents indicating that in January 2017 the former Prime Minister personally pushed through an extraordinary RM1.25 billion project, which was awarded to a car rental company in Bintulu, purporting to install solar energy supplies for 369 Sarawak schools in the interior.

Letters signed by Najib clearly authorised for the Ministry of Education’s strict rules on tendering and price negotiation to be over-ruled during the awarding of the project and later for payments to continue to be made, even though the terms of the contract were not being fulfilled by the company.

Ministry of Education staff who raised concerns about quality control were transferred from their posts, according to our information, and reports to the police and MACC were ignored right up until the last election.

Insiders say several companies qualified to install solar power in Malaysia were by-passed for the contract, in favour of the politically connected Sarawak company, Jepak Holdings Sdn Bhd, which lacked a track record in the field.

Now, 18 months into the three year contract not a single solar power unit has yet been installed at any of the designated schools, although the money has continued to flow from the Department of Education.

Angry whistleblowers have now passed their dossier of damning information to senior anti-corruption figures in the new government, who have indicated the matter is now being investigated. As one disgusted insider told Sarawak Report:

“The company was made tycoon overnight by Najib. This company even enjoyed a privilege never given to any companies in the world where even price comparison and negotiations were skipped. Najib’s Minutes for the Company encompasses issuing an Uncompromising Letter of Award, pressing the Ministry to forgo price negotiations and also requesting the Ministry to approve the finalized price set by the company itself.”

Solar Power Plan Or Fancy Excuse To Award A Billion Ringgit?

Particularly galling for Sarawak families is the fact that the consequences of the contract have included serious supply problems for the affected schools, many of which have been regularly cut off from electricity altogether and facing blackouts for several hours a day.

Previous to this project, which was touted to provide cleaner, cheaper solar energy, the affected schools relied on deisel generators, which were supplied and maintained by some 30 local companies, who were required to regularly tender for the service contracts by the Ministry of Education. Jepak Holdings had held one of the contracts.

However, under the new contract Jepak Holdings took over the entire diesel supply and maintenance work for all 369 schools for an agreed lump sum of RM21.8 million a month, whilst simultaneously being tasked to convert the schools to solar hybrid systems at a rate of at least ten schools a month.

It might appear a seemingly enlightened strategy, if placed in the right hands for the right amount of money. However, insiders say that the diesel contract was in fact heavily inflated above the actual cost of supplying the schools.

Worse, despite raking in millions, the company has failed to provide sufficient upkeep and supply of the existing diesel generators, let alone install the new solar power supplies. The schools need 2 to 4 generators, but most are currently running on just 1 genset which can only provide electricity for a maximum of 12 hours a day. According to a source:

“to cover up their incompetency, the company just falsified claims and in at least one case forged a school principle’s signature on forms to verify the work. The principle discovered this fraud when Ministry officials conducted a random check. The school head then wrote to officially complain to Ministry, but no action was taken. Instead, the principle was later forced to withdraw the complaint after receiving threats. He was even told to call certain high ranking officers in Ministry and to inform them that it had just been a misunderstanding.”

Najib Signed Off Hundreds Of Millions On ‘Scam’ Solar Project For Sarawak Schools
10 June 2018 – SR


Malaysia Steps Up $4.5 Billion Corruption Inquiry – NY Times

Malaysia Steps Up $4.5 Billion Corruption Inquiry

SINGAPORE — Malaysia’s new leader is moving aggressively to investigate the apparent theft of billions of dollars from a state investment fund under the previous government, including seeking the arrest of a key figure in the scandal, the financier Jho Low.

The United States Department of Justice estimates that $4.5 billion went missing from the fund, 1 Malaysia Development Berhad, known as 1MDB, which was established and overseen by the former prime minister Najib Razak — including $731 million that it says was deposited into Mr. Najib’s own bank accounts.

Mr. Najib, who denies any wrongdoing, suffered a surprise election defeat last month at the hands of Mahathir Mohamad, 92, who had previously served more than two decades as prime minister before retiring at 78.

Back in office, Mr. Mahathir has made investigating the scandal and recovering the money a top priority.

Mr. Najib and his wife, Rosmah Mansor, have been barred from leaving the country while investigations continue. Authorities raided residences associated with the couple nine days after the election and confiscated more than 350 boxes and pieces of luggage containing luxury handbags, jewelry, watches and $28.6 million in cash.

Mr. Mahathir told reporters on Friday that the authorities were now seeking Mr. Low over activities related to the fund. Mr. Low, a Malaysian, helped set up 1MDB after its founding in 2009 and, though he never held an official position at the fund, has been described by authorities in the United States as a key figure in moving money out of it.

“We are trying to arrest Jho Low,” the prime minister told reporters. “He is not in the country and we don’t have extradition rights in the country where he is staying.”

When asked what country that was, he said, “many countries.”

Mr. Low was a friend of Mr. Najib’s stepson, Riza Aziz, whose production company, Red Granite Pictures, later used money said to be from 1MDB to produce Hollywood movies, including “The Wolf of Wall Street.”

Mr. Low, who spent millions of dollars on gifts to celebrities such as the actor Leonardo DiCaprio and the model Miranda Kerr, has been sighted in various parts of Asia in recent years.

The United States Department of Justice estimates that $4.5 billion went missing from the state investment fund, 1 Malaysia Development Berhad, under the former prime minster Najib Razak, center.CreditSadiq Asyraf/Associated Press

In February, the United States asked Indonesia to seize a 300-foot megayacht, the Equanimity, that it said Mr. Low had bought with $250 million from 1MDB. But an Indonesian judge later ordered the vessel released, saying that the authorities had not followed proper procedures.

Mr. Mahathir’s new attorney general, Tommy Thomas, said on Wednesday on taking office that 1MDB would be the government’s “first and immediate priority.”

“We shall institute criminal and civil proceedings in our courts against the alleged wrongdoers,” he told reporters. “All are equal before the law and no one will be spared. There will be no cover-up.”

He said Malaysia would cooperate with the United States, Switzerland, Luxembourg, Singapore and other countries that had been investigating the use of their financial systems to hide the missing money.

Malaysia Steps Up $4.5 Billion Corruption Inquiry
By Richard C. Paddock
June 9, 2018 – NY Times


Najib may face charges of money laundering, misappropriation of property

Exclusive: Malaysia’s Najib may face charges of money laundering, misappropriation of property – source

KUALA LUMPUR (Reuters) – Malaysian authorities investigating scandal-hit state fund 1Malaysia Development Berhad (1MDB) are considering charging former prime minister Najib Razak with money laundering and misappropriation of property, a source familiar with the matter said.

Najib, who founded 1MDB in 2009, is the subject of a money laundering and corruption probe, after reports that millions of dollars made their way into his personal bank accounts from the fund and its former subsidiary, SRC International. The former premier has consistently denied any wrongdoing in relation to 1MDB.

Najib, 64, suffered a shock loss in the May 9 general election, the first change of government since Malaysia gained independence from Britain in 1957. Mahathir Mohamad, who was elected prime minister, has vowed to bring back funds allegedly siphoned from 1MDB and punish those responsible.

Malaysia’s new Attorney General Tommy Thomas said on Tuesday his office was studying possible criminal and civil action, after receiving investigation papers on 1MDB from the Malaysian Anti-Corruption Commission (MACC).

A source close to the investigations told Reuters Najib may be charged with dishonest misappropriation of property under the Malaysian Penal Code. The source declined to be identified as they were not authorized to speak on the matter.

The offense carries a maximum jail sentence of five years, a fine and whipping. The law, however, forbids men over the age of 50 years from being whipped.

Any fine would be decided by the court depending on the offense and amount misappropriated.

According to the source, Najib may also face money laundering charges, which would carry a maximum sentence of 15 years’ jail and a fine of no less than five times the value of the laundered proceeds.

It is now up to the attorney-general to decide whether or not to accept the recommendations, file different charges or call for further investigations. The previous attorney general cleared Najib of wrongdoing in relation to 1MDB.

Exclusive: Malaysia’s Najib may face charges of money laundering, misappropriation of property – source
Rozanna Latiff
June 15, 2018 – Reuters


The most expensive RM110 billion HSR project

The HSR saga

THE current discourse in the media regarding the high-speed rail (HSR) project provides a spectacle of hard stand, threat, fear, anxiety and anticipation among the stakeholders and spectators alike.

On May 28, after days of discourse through the media, Prime Minister Dr Mahathir Mohamad announced the scrapping of the HSR project. Depending on whom, the various contradictory responses are understandable.

The Pakatan Harapan government now estimates the total cost for the HSR at RM110 billion with interest added, while the previous government’s figure is RM72 billion.

At 350km, it works out to RM314.29 million per kilometre, or US$79 million. Comparative cost of HSR projects elsewhere (China, US$17 million to US$21 million; Europe, US$25 million to US$39 million; and California, US$56 million), according to the World Bank report in 2014, puts ours the most expensive project in the world.

The European Commission postulated that for a viable HSR project, the necessary minimum passenger load per year is nine million. The KL-Singapore flight route has four million passengers per year. The HSR ticket will have to compete with the current low-cost air ticket of around RM150 per trip.

A major factor when planning a HSR project is to decongest existing cities along the route.

Between KL and Singapore, the cities and townships are rather sparsely developed. Its proponents would argue that the project is likely to help develop more areas and raise the value of properties.

However, there cannot be too many stops as to cause delay and discourage travellers. New township and development areas resulting from the HSR route also mean new ghost towns and disused old rail lines and stations.

Arguments for job creation, economic multiplier effect and increased gross national income are subjective and speculative at this early stage. Often, economic and national income projections are way off the mark.

It is not clear if the projected cost of the HSR has taken into consideration the cost of acquiring land. As the project is a favourite “baby” of the previous prime minister, it is interesting to ask how much of the land to be acquired belongs to the military allegedly privatised and if so, who owns those parcels of land now. Also, if the planned seven stops along the route sit on those military land parcels.

If Malaysia already has existing heavy industries in the form of train construction and engineering know-how to complement the HSR project, then that is a positive factor to consider.

Total dependence on Chinese contractor, workforce, and even every nail, bolt and nut from China, is a no deal. A transfer of technology is also not a certainty. Bonds have to be issued, therefore, adding to the national debt burden, which is a humongous sum more than RM1 trillion.

All factors considered, the cost per kilometre, hidden costs, operating cost, low passenger load, ghost towns, land acquisition, possible secret deals, and the current debt to GDP ratio of 80% – all these add to the enormous financial risk to our nation if the project is to be carried out. These are the perspectives from the side of Malaysia.

From the Singapore perspective, the HSR track covers only 15km and some initial and survey works have been done. The claim of RM500 million for compensation for rescinding the contract is probably not even worthy of it as a good neighbour existing in eternity. For now, suspense has to fill the waiting period for the official notice.

The HSR saga
Wong Ang Peng
7 Jun 2018 – Malaysian Insight


Cash, jewellery, other luxury items worth over RM500 million seized in ongoing 1MDB probe

Over half a billion ringgit in value seized in ongoing 1MDB probe

PETALING JAYA: The estimated value of the seized cash, jewellery and other luxury items from the residence of former prime minister Datuk Seri Najib Abdul Razak and other locations in the police probe on the 1Malaysia Development Berhad (1MDB) scandal might exceed half a billion ringgit.

Sources revealed that while the count of the seized wads of cash in local and various foreign denominations stood at RM114 million, the value of the confiscated jewellery and other luxury items such as branded watches and handbags, including those seized in a raid at two houses in Putrajaya on Monday, could exceed over RM400 million.

The tedious process of evaluating hundreds of the seized designer goods by third party luxury merchandise experts engaged by police is ongoing and is expected to be completed in the coming weeks.

On Monday, more documents and 40 handbags were seized by the federal police anti-money-laundering division when they raided two houses in Putrajaya at Precinct 10 — a short distance from Seri Perdana, the official residence of the Prime Minister — and Precinct 11.

Federal police head of the anti-money-laundering division SAC Datuk Khalil Azlan Chik confirmed that the raid was conducted in relation to the probe into the 1MDB scandal.

The probe into the multi-billion ringgit scandal intensified days after the new Pakatan Harapan government took over the administration of the country after winning the general elections on May 9.

Najib’s residence in Taman Duta, three luxury units at the Pavilion Residence KL condominiums belonging to his daughter and son and an unnamed businessman with the honorific title of Tan Sri were raided over several days by the police federal commercial crimes investigations department (CCID).

The raiding party seized hundreds of bags containing cash, watches, designer brands such as Hermes, Birkin and Louis Vuitton handbags.

It took a dozen police lorries and vehicles to ferry the seized goods out of the raided places.

Police also raided the former prime minister’s office in Putrajaya where stacks of documents relevant to the investigations were confiscated.

Over half a billion ringgit in value seized in ongoing 1MDB probe
13 June 2018 – Sun Daily

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?