1MDB scandal: Complete silence from Securities Commission and the tax authorities

More than 5 weeks ago, we wrote about the silence of Securities Commission on the misused of cash by 1MDB back in 2009. The cash, totalling RM5 billion was derived from the bonds 1MDB acquired under the Islamic Medium Term Notes which was guaranteed by the government.

We said:

This IMTN bond which was fully guaranteed by the government can be categorised as taxpayers money. Because in the event of a default, it is the taxpayers who had to pay for it. Since BNM had revoked the permissions, this should trigger red flag from other regulators.

One such regulator is the Securities Commission (SC).

The SC is the controller of bond issuance process. And they also ensure compliance to documents when the bond was offered. Below is the term sheet for the IMTN and the purpose stated when it was issued:

Clearly shown the principal terms and condition of the loan is to be utilised in compliance to Shariah principles

Clearly shown the principal terms and condition of the loan is to be utilised in compliance to Shariah principles

Is sending money to Good Star Ltd in compliance to Shariah principles? What does Good Star do? Selling hijabs to Hollywood celebrities during lavish birthday parties?

Plus, is putting the USD1.83 billion in Cayman Islands in compliance with Shariah principles? Are the units endorsed by a Shariah Adviser? Is the Hong Kong based Bridge Partners which ultimately managed those worthless units a Shariah compliant company? The bond is called the ISLAMIC medium term notes guaranteed by the Government, not It’s My Daddy’s Money So I Can Do Whatever I Want With It.

Many rules, act and terms were broken here yet there weren’t any noise coming out from Securities Commission. The data and goalpost have been changed unilaterally by 1MDB’s management yet the supervisory body like Securities Commission did not even make a squeak.

But up to this date, the SC has been quiet.

Perhaps they are no longer following their own mission statement and the reason for their existence. They proudly state in their website that their ultimate responsibility is to protect investors of the bonds. But alas, there seems to be a breakdown in this regulatory body.

We have had enough absurdity coming from the AG Chambers and the PAC. Now it seems SC is also following suit.

Tan Sri Zeti of Bank Negara made a valiant effort in upholding the principles of corporate governance by castigating and reprimanding 1MDB. The top management of this debt laden and near bankrupt company will have to pay the price soon. Even now they are stripping their asset and selling them just to pay off their massive debts.

A colossal chunk of their asset totaling around RM18 billion will be taken off their books due to the sale of Edra Energy Berhad.

Now 1MDB whose assets are around RM52 billion as per their 2014 accounts will be reduced to approximately RM34 billion.

To put matters into perspective, the total cost of building Putrajaya from 1995 to 2008 was about RM12 billion. Imagine if the government had to sell the whole of Putrajaya to foreigners in order to pay off debts they had foolishly accumulated.

And all this stemmed from the misused of those RM5 billion bonds back in 2009.

Clearly, 1MDB did not use the bonds according to Shariah principles. Bank Negara Malaysia even went to the extent in exposing that 1MDB had given false information when they applied to remit the money overseas.

The evidence are for all to see. The Board minutes of 1MDB back in 2009 revealed that some USD700 million was asked by the board members to be repatriated back immediately as soon as it was known to be wrongfully credited into an unauthorised company called Good Star.

This led to the resignation of 1MDB’s two board members.

There were so many red flags yet Securities Commission buried its head in the sand. Is this the end Securities Commission’s reputation?

Will this Executive Chairman of SC wake up from his slumber?

The Executive Chairman of SC seemingly oblivious to SC’s own regulatory functions

Perhaps the boss of SC is waiting for a Tan Sri-ship first before he could do his job properly? Perhaps only then will he act with much bravery like the illustrious Tan Sri Zeti?

Bear in mind that Najib Razak won’t be the prime minister forever. He will have to step down eventually. Nobody is an immortal. And after he steps down for whatever reason, people will remember those who are in charge of corporate governance but are closing both eyes for the many wrongdoings in his administration.

In any case, it is already too late. We were hoping at least Securities Commission would have enough integrity to reclassify or proclaim that the IMTN bonds have failed to comply with the Shariah principles, just like how they periodically publish in their website on other securities. But even this simple act they have failed to live up to.

Speaking about Tan Sri-ship, there is another Tan Sri who are as quiet as the boss of Securities Commission.

This person is the CEO of Inland Revenue Board. He is YBhg Kolonel (K) Tan Sri Datuk Wira Dr. Hj. Mohd Shukor Bin Hj. Mahfar.

fjkhf vhik

The CEO of IRB, driven by vision and a firm believer of human governance

All sundry now know that Najib Razak had received enormous amount of money in his personal bank accounts. It is an amount many could not have imagined to be amassed in a short span of time. But he did receive RM2.6 billion through overseas banks and another RM42 million from SRC International.

This was not denied by Najib Razak himself. He did not even give any proof on what it was spent on.

His wife, Rosmah Mansor was also reported to receive RM2 million in her private accounts.

Therefore, the people would like to know how much tax have they paid for this sort of income?

We all know that IRB is very strict in its regulation. Any Tom, Dick and Harry will immediately be hunted down if they ever tried to evade taxation.

The little people on the streets will be slapped with penalties if they submitted their tax returns late.

Hence, if IRB still have their corporate soul and have the courage to stand up for good corporate governance, and upholding the law without fear or favour, many questions would have been answered expeditiously; rather than leaving everything hanging and unanswered.

We do hope these institutions would remain respected in the eyes of the world. There is no point strutting around meeting people and giving speeches about corporate governance when behind your backs, people are questioning why didn’t you do your job as expected?

Again, Najib Razak won’t be the prime minister forever. Once he is gone, the public will look back and scrutinise the institutions which had failed to uphold the tasks that they are trusted to do.

You might also want to read:

1) Idea Idealistik Najib @ 1MDB Yang Menggadai Negara!

2) 1MDB exits power business

3) Apa Pulak Yang CheDet Sebut Pasal Penjualan Edra Ni?

4) Bring the real saboteurs before court

5) Najib sedang menghancurkan Umno

6) Calling Najib ‘national disgrace’, youth says many too scared to criticise PM, Umno

7) 1MDB May Have Violated US Election Laws

8) Malaysia invokes British-era law to stifle critics’ voices

#1mdb, #malaysian-corporate-matters

Aset 1MDB susut dari RM52 billion kepada RM34 billion akibat jualan Edra Global Energy

… hanya kerana tidak mampu membayar hutang.

Semalam diumumkan bahawa sebuah syarikat dari China telah membeli anak syarikat 1MDB bernama Edra Global Energy pada harga RM9.83 billion.

A: Dulu masa sekolah menengah, saya juara debat B: Dulu masa di kolej, saya dapat CGPA 3.80

A: Dulu masa sekolah menengah, saya juara debat
B: Dulu masa di kolej, saya dapat CGPA 3.85

Edra Global Energy adalah syarikat yang memiliki stesen-stesen janakuasa (IPP) yang suatu ketika dulu dipunyai oleh syarikat Genting milik keluarga Lim Goh Tong, syarikat Tanjong Energy milik Ananda Krishnan dan syarikat Jimah Teknik milik kerabat Negeri Sembilan.

Kesemua syarikat-syarikat di atas di miliki oleh rakyat Malaysia.

1MDB membeli aset-aset di tersebut dengan harga lebih kurang RM18 billion di dalam tahun 2012/2013. Pembelian tersebut di biayai oleh hutang.

Oleh kerana 1MDB tidak diurus dengan baik oleh lembaga penasihat dan pengarah, dan Najib Razak sendiri akhirnya mengakui bahawa model perniagaan 1MDB telah gagal (walaupun berbulan-bulan sebelumnya beliau berkata 1MDB adalah syarikat yang terbaik di dalam alam semesta), aset aset tersebut terpaksa dijual untuk menampung pembayaran balik hutang.

Oleh kerana penyata kewangan 1MDB lewat dikeluarkan lagi pada tahun ini, kita tidak mengetahui berapakah sebenarnya nilai aset IPP tersebut. Bagi memudahkan pemahaman pembaca, kita anggaplah bahawa nilai aset tersebut adalah sama dengan harga pembelian, iaitu lebih kurang RM18 billion.

Jumlah aset 1MDB pada tahun kewangan 31 Mac 2014 adalah lebih kurang RM52 billion ringgit. Oleh kerana kita tidak mengetahui jumlah sebenar keseluruhan aset 1MDB pada tahun kewangan berakhir 31 Mac 2015, maka kita guna kan dahulu angka RM52 billion tersebut. Najib Razak sendiri suka menggunakan angka tersebut untuk membuktikan betapa berjayanya 1MDB mempunyai harta sebanyak itu.

Akan tetapi akibat penjualan Edra Global kepada syarikat asing, aset 1MDB telah menyusut sebanyak RM18 billion kepada RM34 billion!

Walaubagaimana pun, untuk menyedapkan hati rakyat, 1MDB dan kuncu kuncunya berkata bahawa hutang 1MDB akan berkurangan akibat penjualan tersebut. Mereka malu untuk mengatakan bahawa apabila menjual syarikat Edra Global Energy maka aset mereka juga akan berkurangan.

Najib Razak adalah Perdana Menteri pertama yang tidak malu untuk mengatakan bahawa kehilangan berbillion billion harta negara adalah bagus dan 1MDB sebenarnya berada di landasan yang betul untuk mengurangkan hutang-hutang mereka.

A: Oh ini kah dia berniaga cara glokal dan blue ocean strategy Dato Sri? B: Ya, ya.. baguskan? Hahahaha

A: Oh ini kah dia berniaga cara glokal dan blue ocean strategy Dato Sri?
B: Ya, ya.. baguskan? Hahahaha

Jurucakap beliau, Arul Kanda pernah berkata bahawa aset-aset 1MDB hanya akan tinggal sebanyak RM10 billion sahaja selepas selesai pelan jualan lelong harta mereka yang dikenali sebagai pelan rasionalisasi. Sangat hebat mereka ini.

Najib Razak juga adalah Perdana Menteri pertama Malaysia yang berjaya menukar peraturan pemilikan industri strategik tanahair di mana Suruhanjaya Tenaga telah memberi pengecualian kepada Edra Global untuk menjual 100% hakmilik sahamnya kepada syarikat asing.

Pelupusan syarat tersebut adalah semata-mata untuk 1MDB menyelesaikan hutang-hutang mereka.

Oleh itu dapatlah disimpulkan bahawa kesan penubuhan 1MDB adalah:

a) kesemua syarikat syarikat milik rakyat Malaysia akhirnya jatuh ke tangan negara asing

b) rakyat Malaysia melalui 1MDB sia sia terpaksa membuat hutang sebanyak RM18 billion. Pelaburan ini boleh dikatakan hangus begitu sahaja

c) rakyat Malaysia melalui 1MDB sia sia membeli syarikat syarikat IPP pada harga lebih tinggi dari pasaran iaitu sebanyak RM18 billion

d) rakyat Malaysia dijanjikan tarif eletrik lebih rendah apabila pembelian dilakukan dalam tahun 2012 tetapi tarif eletrik naik 15% dalam tahun 2014

e) industri strategik tanahair iaitu penjanaan kuasa elektrik boleh dimiliki 100% oleh negara asing

Jika 1MDB tidak pernah ditubuhkan maka kesan yang mungkin rakyat rasai adalah:

a) apabila tamat tempoh konsensi, IPP tersebut boleh dibeli oleh TNB pada harga yang jauh lebih rendah

b) syarikat Malaysia tidak perlu berhutang sebanyak RM18 billion untuk membelinya

c) syarikat milik Malaysia tidak perlu jatuh ke tangan pihak asing dengan lesen konsensi diperbaharui dengan begitu lama sekali

d) para menteri dan pengampu tegar tidak kedengaran begitu bodoh setiap kali bercakap untuk mempertahankan 1MDB

e) industri penjanaan kuasa eletrik tidak perlu diliberalisasi untuk tujuan menyelamatkan 1MDB

Hasil jualan RM9.83 billion bukannya untuk kebaikan rakyat Malaysia. Ianya tidak boleh digunakan untuk membina 2 lagi KLIA atau 8 lagi KLCC atau beratus-ratus sekolah dan hospital. Ianya juga tidak mungkin digunakan untuk membayar konsensi tol pada tahun depan. Ini kerana wang tersebut akan digunakan untuk membayar hutang.

Benarlah kata orang, bahawa 1MDB berniaga buluh kasap; hujung hilang, pangkalnya lesap.

Rakyat tidak dapat apa-apa untung darinya. Sepatutnya kerugian harta berbillion ringgit seperti ini perlu diiringi oleh pemecatan mereka yang terlibat secara langsung. Tetapi malang sekali, orang lain pula yang kena pecat.

Terima kasih Najib Razak!

Anda juga pasti ingin membaca:

1) Malaysia’s transparency upside down – TK Chua

2) Penjualan Edra Kepada Negara China – Hasil Pelaburan Strategik 1MDB!

3) Malaysia’s 1MDB Decoded – How Millions Went Missing

4) Faulty Reward System and Changeable Governments

5) Cerita Arul Kanda Untuk Yang Percaya

6) RM2 juta dalam akaun Rosmah Mansor adalah derma ikhlas?

7) Ada Orang Kata, PM Tak Malu

8) Harta Negara Akan Dilelong Untuk Selamatkan 1MDB

#1mdb, #malaysian-corporate-matters

Arul Kanda said so many stupid things about 1MDB, it is just sickening

… yet the stupid Umno people who attended this morning’s session in PWTC clapped their hands when Arul Kanda told them that Malaysia pays RM5 billion of service charge and fees in the course of 5 years for the RM42 billion debt borrowed; making the cost of borrowing to be alarmingly high. The banking creditors and Goldman Sachs says THANK YOU MALAYSIA AND THANK YOU NAJIB RAZAK!

Roughly, giving away RM1 billion on average per year just for service charge and fees is not a bad business deal for the people in 1MDB.

Shahrir Samad, in his stupidity also declared there will be a happy ending when Arul Kanda declared that 60% of the government land meant for bumiputra development in Bandar Malaysia will be owned by foreigners. Obviously Shahrir is happy because he received RM1 million from the Prime Minister and had not furnished any documented evidence that the money was not used for personal amusement and benefit. The Prime Minister haven’t given the public such evidence as well.

The village idiots are so happy to lose RM40 - RM42 billion of assets just to pay their debts

The village idiots are so happy to lose RM40 – RM42 billion of assets just to pay their debts

If 1MDB hadn’t lost the billions of money that can be used to pay the debts, they could have the resources to develop Bandar Malaysia and TRX on their own and don’t have to sell it to foreigners at all. That would be a happy ending. Is Shahrir Samad the kind of politician to be happy giving away our sovereign lands to foreigners? He must truly be an idiot.

And did Shahrir Samad express his delight when 1MDB will be left only with RM10 – RM12 billion from its so called RM52 billion of assets? He must have.

Imagine, to pay off RM42 billion of debts, 1MDB had to sell nearly RM42 billion of assets.

Basically that is RM42 billion of assets lost to other people’s hands. And 1MDB had to pay billions of interests and pay billions of fees along the way! People actually clapped their hands when he announced that 1MDB will lose about 80% of their assets to pay off debts.

If for example the CEO of Apple had announced 80% reduction of assets, he and the board of directors would have been hung dry by the shareholders. But yesterday, some Umno people gave him an applause! Unbelievable.

And there were idiots who were giddily happy when Arul Kanda in his silly smile proudly telling them that 1MDB will sell the assets belonging to Malaysians to foreigners just so that the money they get will be given to creditors.

It is not enough that the rakyat had to pay RM950,000,000 in the form of standby credit for 1MDB, now they will lose majority of the assets to foreigners!

1MDB is on the verge of bankruptcy and they had to perform this asset stripping exercise dubbed ‘the rationalisation plan’ so that 1MDB will appear to be a success. The only success 1MDB has done so far is to stupefy the cabinet ministers and Najib Razak’s cybertroopers.

“We did it so help the rakyat”

“We did it to help the rakyat”

Another lie Arul Kanda said was that 1MDB bought the IPPs in 2012 at above market prices because they want to reduce the tariff, in order to help the rakyat.

“End of the day, the people will benefit”.

That is what he said.

But the electricity tariff went up 15% on 1st January 2014!

In the first place, the answer to the question as to why the IPPs were bought at above market prices did not have any correlation with the increase or decrease of rakyat’s electricity bills.

The immediate impact it had was that 1MDB incurred about RM18 billion of debts! The end game unfortunately is – the rakyat had to lose their IPPs after this stupid company had bought them at such high costs and on top of that, they had to pay higher electricity bills!

PM increased electricity rates after throwing away RM18 billion to buy IPPs

PM increased electricity rates in January 2014 after throwing away RM18 billion to buy IPPs in 2012

So what kind of stupidity have Arul Kanda said when he told the simpletons at PWTC yesterday that buying private IPPs from their owners at an astronomical prices will bring down the tariffs?!

Did he eat a bottle of stupid pills yesterday morning and hoped for the best?

Which part of this had benefited the rakyat? 1MDB promised that the tariff will be reduced, but that was just a lie. Worse, the tariff rate did not even maintain at the current level it had, it went up instead!

The only people that laughed the loudest were the IPP owners and the banks that gave the debts to 1MDB. Tun Dr. Mahathir said so many times as to why 1MDB is so stupid to pay so much for the IPPs when they could get it cheaper after their licence agreements expired.

This is what he said in June 2015:

17. RM18 billion was spent to purchase IPP belonging to Ananda Krishnan, Genting Sanyen Power (now known as Kuala Langat Power Plant) and Jimah Energy.

18. The prices paid for Genting Sanyen and Ananda’s IPP were well above market price. 1MDB also paid RM6 billion for unpaid loans. The Jimah IPP was to put up another power plant. But 1MDB had no money to build this plant

19. Genting Sanyen and Tanjung Energy (now known as Powertek Energy Sdn Bhd) were nearing expiration of their licenses. Had 1MDB waited until the licenses expired, the price would be next to nothing.

20. Why 1MDB did not wait until the expiry of the license is a mystery. Genting and Ananda clearly made more money than they were entitled to. One estimate is that the high price netted the sellers an extra RM3 billion. Besides they are relieved of the loan of RM6 billion.

21. So not only is the borrowing costly but the high cost of investments will mean low returns. Why is 1MDB so stupid.

22. As stated above 1MDB is unable to get the IPP listed again. Who would want to own overpriced and obviously unprofitable power plant.

Some people are saying that Arul Kanda was a legendary debater at a high school stage. Perhaps something went wrong along the way which made him appear to be a liar, a buffoon and a clueless hoodwinker these days.

No wonder an Umno grassroot leader sees him as a spinner. But then again, even George W. Bush went to an ivy league university at Yale.

I will just let Arul Kanda make a fool of himself over things I was responsible for

I will just let Arul Kanda make a fool of himself over things I was responsible for

As long as my salary is ridiculously high, I don't mind being the silly mouthpiece of Shahrol and Najib.

As long as my salary is ridiculously high, I don’t mind becoming the silly mouthpiece for Shahrol and Najib.

I wonder how those two jokers fare in defending my political career. Endless possibilities.

I wonder how those two jokers fare in defending my political career… endless possibilities.

You might also want to read: 1) Penerangan Perdana 1MDB – DiTanya Kenapa Beli IPP Lama Harga Mahal, Arul Konar Cerita IPP Baru! Belit betul la…

2) Arul – Dana Cayman Belum Tebus Sepenuhnya la …. Pulak Dah!??

3) Auta Arul yang berteknologi tinggi

4) From Cabinet Commander-in-Chief to Embezzler-in-Chief?

5) Najib, explain the US$3.5b guarantee by IPIC

#1mdb, #malaysian-corporate-matters

Kegagalan Najib Razak

Minggu lepas Perdana Menteri akhirnya mengaku bahawa 1MDB adalah satu perniagaan yang gagal.

Walaupun Perdana Menteri kita adalah seorang billionaire (kerana lebih RM2.6 billion terbukti dijumpai di dalam akaun peribadi beliau), dan beliau merupakan ketua penasihat 1MDB, syarikat tersebut ternyata gagal untuk mencapai misi yang patut dicapainya.

Setelah berbulan-bulan sebelum ini Perdana Menteri memaklumkan kita semua bahawa aset 1MDB melebihi liabiliti, dan cuba menipu mengatakan 1MDB tidak pernah kerugian lagi, ternyata semua kata-kata tersebut adalah kosong semata-mata. Ianya tidak lebih hanyalah untuk meyedapkan hati sendiri sahaja.

Ini kerana, rakyat sudah bijak mengkaji dan berfikir bahawa tiada apa yang boleh dilakukan oleh Perdana Menteri dan konco-konconya untuk ‘mewangikan’ bangkai yang busuk seperti 1MDB.

Kini setelah ternyata tiada apa bukti yang boleh ditunjukkan untuk menidakkan kebenaran, mereka beralih kepada hujah bahawa pelan rasionalisasi 1MDB sedang menunjukkan kejayaan.

Amat berbeza sekali tujuan 1MDB ditubuhkan dan tujuan pelan rasionalisasi tersebut. Pada asalnya 1MDB kononnya akan meningkatkan ekonomi Malaysia dengan terbinanya Bandar Malaysia, dan turunnya kadar letrik negara kerana pembelian IPP serta penyenaraiannya di dalam bursa. Pendek kata, 1MDB akan memakmurkan Malaysia dengan pembangunan ekonomi yang mampan tanpa menggunakan hutang kerajaan yang besar.

Tapi yang berlaku adalah sebaliknya. Oleh kerana penyelewengan telah berlaku dan wang berbilion telah hilang, maka tujuan 1MDB ditubuhkan telah bertukar kepada proses pembayaran balik hutang yang lebih banyak bertimbun. Maka bermulalah proses menjual semula aset aset yang telah dibeli melalui hutang, supaya wang yang akan diperolehi digunakan untuk membayar balik hutang-hutang tersebut. Tersenyum lah para pemberi hutang dan bank-bank yang berkaitan.

Rakyat Malaysia akan kehilangan aset-aset tersebut kepada pihak swasta dan pihak luar; hanya kerana Perdana Menteri dan konco-konconya di dalam 1MDB tidak tahu bagaimana hendak berniaga. Mereka cuma tahu menghilangkan wang sahaja. Hinggakan tidak cukup untuk membayar pinjaman mahupun bunga pinjaman. Tanah yang sepatutnya tanah kerajaan yang dikhaskan untuk pembangunan bumiputera juga mungkin akan terjual kepada pihak asing.

Bahkan wang rakyat berjumlah RM950 juta telah diberi oleh kerajaan untuk menolong 1MDB melangsaikan bunga pinjaman. Alangkah baiknya wang tersebut dapat diguna untuk membayar konsesi tol supaya rakyat tidak payah menampung kenaikan harga tol yang tinggi. Ini tidak, wang tersebut hangus cuma untuk membayar kepada peminjam sahaja.

Disebabkan Perdana Menteri pada mulanya cuba menipu rakyat dengan mengatakan semua berkenaan 1MDB adalah baik-baik sahaja akan tetapi bangkai gajah tidak dapat ditutup dengan nyiru selamanya. Oleh itu sememangnya kita boleh isytihar bahawa kepimpinan Perdana Menteri ini adalah yang terburuk di dalam sejarah Malaysia.

Semasa isu RM2.6 billion mula dibocorkan kepada umum oleh suratkhabar Wall Street Journal, Perdana Menteri telah memfitnah Tun Dr. Mahathir dengan mengatakan bahawa bekas perdana menteri itu telah bersekongkol dengan pihak asing untuk menjatuhkan beliau melalui tuduhan yang tidak betul.

Fitnah tersebut terbukti tidak benar apabila bukti bukti yang dikemukakan telah menunjukkan bahawa memang betul Perdana Menteri telah menjadi seorang billionaire di dalam tahun 2013. Dari mana atau untuk apa wang tersebut tiba tiba muncul, tidak pula diberitahu. Bahkan ramai di dalam Umno yang terperanjat dan siasatan pun dimulakan. Malangnya, beliau telah memecat orang-orang yang sedang menyiasat bukti-bukti tersebut.

Pandangan dunia mengenai Malaysia

Pandangan dunia mengenai pemimpin Malaysia

Perdana Menteri juga berkata bahawa punca Tun Dr Mahathir marah kepada beliau kerana kononnya Perdana Menteri tidak mahu menjadi proksi.

Akan tetapi, oleh kerana umum sudah mengetahui bahawa Perdana Menteri tidak tahu mentadbir negara dengan betul dan ternyata lebih cuba melindungi kroni-kroni beliau seperti Jho Low dan juga lebih mementingkan orang yang tidak cerdik tapi cuma tahu menjadi setia membabi buta sahaja, maka adalah lebih baik jika Perdana Menteri ini mempunyai proksi.

Mengapa? Supaya dia dapat dipimpin tangan dan diperbetulkan dari melakukan perkara-perkara yang tidak baik (seperti melambatkan penyiasatan ke atas dirinya, meletakkan orang-orang yang mengampu dan melindungi beliau), dan akhirnya cukup pandai untuk meletakkan Malaysia di landasan yang betul.

Daripada mengikut telunjuk Amerika dalam hal TPPA atau menjadi pak turut kepada Jho Low dalam hal 1MDB lebih baik jika beliau menjadi proksi kepada penasihat-penasihat yang lebih bagus dan tidak berkepentingan. Sebenarnya Perdana Menteri patutnya menjadi proksi kepada seluruh rakyat Malaysia. Dengarlah dan lihatlah reaksi rakyat Malaysia terhadap kepimpinannya. Buat apa mendengar reaksi dari tukang ampu dan tukang kipas di kalangan menteri kabinet?

Mereka cuma tahu menjaga periuk nasi diri sendiri sahaja; bukannya untuk rakyat. Pangkat ‘wakil rakyat’ itu hanya pada nama sahaja. Mereka cuma wakil kepada perut masing-masing.

Langkah seterusnya untuk Perdana Menteri lakukan adalah dengan segera mengakui bahawa ekonomi Malaysia sedang goyah dan kadar matawang ringgit tidak sebagus dulu. Usahlah beliau dan menteri-menteri kabinet membuat ucapan yang kedengaran amat tolol dan terpekik pekik mengatakan ekonomi Malaysia adalah utuh dan kuat.

Kita tidak mahu dipimpin oleh para pemimpin yang buta tuli terhadap realiti dan hanya tahu menyelamatkan diri sahaja.

Amat malang bagi rakyat Malaysia kerana mempunyai Perdana Menteri yang suka membuat ucapan yang tidak benar dan tidak berani berdepan dengan masyarakat umum. Dua kali beliau lari dari majlis yang beliau patut hadiri.

Beliau seringkali mengatakan tidak pernah menggunakan wang RM2.6 billion untuk tujuan peribadi tetapi di mana buktinya? Mana butiran perbelanjaannya? Mana resit-resit bayaran apabila ianya dikatakan digunakan untuk memerangi ISIS dan Yahudi? Setakat cakap menghabiskan air liur sahaja mana mungkin orang yang ada otak akan percaya.

Perdana Menteri sepatutnya duduk di atas landasan moral yang tinggi (moral high ground), di mana sebelum rakyat tertunggu-tunggu berbulan lamanya, beliau terlebih dahulu sudah menerangkan dan memberi bukti secukupnya. Beliau tidak patut berdolak dalih atau menyalahkan orang lain. Inilah yang wajib ada pada orang yang bermoral tinggi. Bukannya diam menikus apabila Majlis Raja Raja menasihati beliau. Atau lari bertempiaran dari majlis-majlis yang beliau patut hadiri.

Perdana Menteri yang bermoral tinggi patutnya sudah lama meletakkan jawatan kerana apabila jawatan sudah tidak dapat dipertahankan lagi, maka lebih baik berundur daripada jawatan tersebut terus dicemuh, dihina dan dikecam masyarakat. Kerusi perdana menteri sepatutnya tidak boleh kehilangan rasa hormat.

Perdana Menteri bukannya tahap seorang kriminal yang menyorok dari tindakan undang undang walaupun seringkali mendabik dada mengatakan beliau pahlawan bugis yang pantang berundur bila sauh dilabuhkan untuk berlayar. Jika tidak mahu berkelakuan seperti Perdana Menteri yang gagal untuk bermoral tinggi, adalah lebih baik melepaskan jawatan dan terus berdepan dengan ujian undang-undang.

Itulah sebaik-baik pilihan agar Umno dan Barisan Nasional dihormati semula oleh masyarakat tempatan dan luar negara.

Terima kasih.

Anda juga mungkin ingin membaca:

1) The Trial of our Finance Minister

2) Agenda Najib bodohkan rakyat

3) The Stench of 1MDB

4) Najib can remain as PM so long as the Ringgit does not cross RM 4.60

5) Dr Mahathir moots council of elders to advise PM

6) TPPA: Mustapa To Be Held Responsible

7) Agreeing to disagree

Bukti Perdana Menteri Malaysia menjadi billionaire sekelip mata

Bukti Perdana Menteri Malaysia menjadi billionaire sekelip mata

#1mdb, #malaysian-corporate-matters

A recap on 1MDB’s first foray in their business misadventure

We didn't take much. We took a bit only..

We didn’t take much. We took a bit only..

In the previous article, we have discussed how the 1MDB USD2.32 billion “units” were so worthless, its value has to be guaranteed by a third party. The third party was IPIC/Aabar, 1MDB’s partner in crime for another business foray. In this article, we shall take a look at the whole scheme on how the idea which resulted in billions of worthless units was hatched.

Since The Edge’s ban was declared unlawful by the courts and their suspension was lifted, while the documents they published are now considered authentic due to lack of denials by 1MDB (in most cases, 1MDB confirmed that the documents were indeed valid and not tampered), we shall revisit the devious methodology used by the owners of 1MDB and PetroSaudi to conceal their fraudulent activities from the public.

Below is the recap on 1MDB’s business scam based on The Edge’s investigative reporting via findings from multiple investigations, public records and documents obtained. Taken from The Edge:

How Jho Low & PetroSaudi schemed to steal money from the people of Malaysia via 1MDB

Why we say the US$1.83 billion 1 Malaysia Development Bhd invested in Petro Saudi International between 2009 and 2011 was a scheme to defraud Malaysia

Key Points:

1. The joint-venture agreement was signed on Sept 28, 2009. The terms include 1MDB contributing US$1.0 billion cash for a 40% stake in the JV Co called 1MDB PetroSaudi Ltd. PetroSaudi Holdings Cayman will put in assets worth US$2.7 billion. The JV Co will be valued at US$2.5 billion with PetroSaudi Holdings’ 60% stake derived from assets it will inject into the JV Co.

2. The valuation of the assets that PetroSaudi Holdings will put in was done by one Edward Morse who was hired by PetroSaudi and work was done within days. Morse was issued his appointment letter on Sept 20, 2009 and submitted his report on Sept 29, 2009 — a day after the JV was signed. He valued the Turkmenistan assets at US$3.5 billion and the Argentinian assets at US$108 million.

3. PetroSaudi Holdings never owned the Turkmenistan assets that were to be injected into the JV Co. Those assets were owned by Buried Hill Energy (Cyprus) Co Limited. PetroSaudi Holdings was only in negotiation to buy the assets from Buried Hill. They signed a negotiation agreement on July 4, 2009 and this was eventually terminated on Nov 23, 2009.

4. 1MDB did not hire its own independent valuer to do the valuation. 1MDB management did not comply with a decision of its own board of directors to do an independent valuation.

5. PetroSaudi Holdings committed FRAUD by selling assets which it did not own into the JV Co. [JMD notes: Basically, 1MDB entered into a business with a company without any track records or assets!]

6. Lawyers for 1MDB, Wong & Partners, as well as the 1MDB board of directors were not given the valuation report by Edward Morse until after Sept 30, 2009 — two days after the JV agreement was signed.

7. When the deposit money of US$7.1 million paid to Buried Hill was returned after the negotiation was cancelled, the cash was not returned to the JV Co but to PetroSaudi Holdings. This deposit money should have been returned to the JV Co as it formed part of the assets sold by PetroSaudi Holdings to the JV Co.

8. There was also FRAUD in the creation of a fake US$700 million loan from PetroSaudi Holdings to the JV Co. These are the evidence of fraud:

a) There was no corresponding cash in the JV Co or any of its subsidiaries on or after Sept 25, 2009 (the date the loan agreement was signed). But a letter of demand dated Sept 29, 2009 from PetroSaudi Holdings was sent to the JV Co to pay the loan.

b) From the US$1 billion cash that 1MDB remitted for the JV, US$700 million was paid directly from 1MDB to Good Star Limited instead of the supposed lender PetroSaudi Holdings.

c) The scheme to scam US$700 million from 1MDB was discussed as “over payment” in various email exchanges and attachments between Jho Low and his associates Seet Li Lin, Tiffany Heah, with PetroSaudi executives Patrick Mahony and Tarek Obaid between Sept 11, 2009 and the signing of the JV on Sept 28, 2009.

d) Timothy Buckland (from the UK law firm of White & Case which represented PetroSaudi Holdings) admitted in an email to Charlie Sparrow of PetroSaudi Holdings and copied to Mahony that the letter of demand for repayment of the US$700 million loan was not needed but only “necessary for your docs to legitimise prepayment”.

e) The board of directors of 1MDB was not told about this “loan” prior to the signing of the JV on Sept 28, 2009.

9. The remittance of the US$700 million from 1MDB to Good Star at its bank account at RBS Coutts (Zurich) approved by then 1MDB CEO Sharol Halmi was done without the consent of the 1MDB board of directors which had approved payment of the entire US$1 billion directly to the bank account of the JV Co at JP Morgan Suisse (SA). Two directors of 1MDB Mohd Bakke Salleh and Azlan Zainol resigned because of this payment of US$700 million to Good Star.

10. This transfer of the US$700 million was also a breach of the approval given by Bank Negara Malaysia for 1MDB to remit US$1 billion for the JV. BNM approved payment to the account of the JV Co at JP Morgan Suisse (SA) and not to anyone else.

Why we say Good Star was controlled by Jho Low at the time 1MDB transferred US$700 million

Key Points:

1. 1MDB’s lawyers Wong & Partners, had questioned why the US$700 million was to be paid to Good Star Limited and not to the “lender” PetroSaudi Holdings Cayman. Patrick Mahony, the CEO of the JV Co, said that they were all part of the same company. He lied.

2. 1MDB had on Sept 29, 2009 remitted US$700 million to account number 11116073 at RBS Coutts Zurich. The Malaysian remittance bank was Deutsche Bank Malaysia. RBS Coutts’ risk and compliance unit wanted to know the beneficial owner of the account and then 1MDB CEO Shahrol Halmi replied that it was Good Star Limited.

3. Email communication between the banks and 1MDB on this payment was forwarded to Jho Low by 1MDB executive director Casey Tang.

4. Good Star executed an agreement on Sept 30, 2009 to pay PetroSaudi Holdings’ executive and shareholder Tarek Obaid US$85 million as broker fee. If Good Star was part of PetroSaudi why was there a need to do this?

5. Good Star signed a draft investment management agreement with another PetroSaudi executive Patrick Mahony on Sept 29, 2009. The chief investment officer of Good Star in the agreement was Seet Li Lin, an employee of Jho Low at Jynwell Capital. The metadata of this document in an email attachment showed Jho Low to be the last person to save this file on Oct 1, 2009.

6. On July 21, 2010, Jho Low emailed to Mahony’s Good Star bank account details at RBS Coutts in Zurich to receive part of the US$500 million that was to come from the Murabaha notes 1MDB was to subscribe.

7. On Sept 13, 2010, Jho Low emailed again to Mahony asking him to remit the money to Good Star.

8. Between June 2011 and September 2013, Good Star remitted a total of US$529 million in several transfers to a bank account at the Swiss private bank BSI in Singapore that belonged to Abu Dhabi-Kuwait-Malaysia Investment Corp (ADKMIC).

9. Jho Low has been identified as the beneficial owner of that bank account which was closed in February, 2014.

10. Jho Low had declared himself as a shareholder of ADKMIC when he was involved in the acquisition of the then Bursa Malaysia-listed UBG Bhd in 2010.

Who got what and the trail of international money laundering

Key Findings:

1. Good Star Limited received in total about US$970 million from the US$1.83 billion that 1MDB invested with PetroSaudi Holdings Cayman between 2009 and 2011. From this amount of US$970 million, US$529 million went to the bank account of Abu Dhabi Kuwait Malaysia Investment Corp (ADKMIC) at BIS Bank in Singapore. Jho Low was the beneficial owner of that account.

2. Javace Sdn Bhd, the company that Jho Low used in the 2010 takeover of UBG Bhd, received US$260 million via a loan from PetroSaudi International Seychelles. That money was transferred from the JP Morgan bank account of Tarek Obaid which he received from the US$500 million Murabaha notes subscribed by 1MDB in Sept, 2010. (See The Money Trail Flow Chart)

3. Besides the US$260 million, Tarek Obaid received in total another US$240 million from 1MDB. From this, US$77 million was paid to his partner at PetroSaudi, Prince Turki, US$33 million to Patrick Mahony and US$1.0 million to Nawaf Obaid. (See The Money Trail Flow Chart) [JMD notes: There is no limit to greed, even when you’re supposed to be an arab prince flushed with arab money]

4. Various PetroSaudi companies received around US$330 million, of which US$185 million was used to buy a drill ship. [JMD notes: This would be the Discoverer which they bought in January 2010. Malaysian public actually gifted money to PetroSaudi to buy their first asset! In September 2010, they bought another ship – the Saturn for USD260 million, after they received another USD500 million from 1MDB]

5. Some of the money received by these individuals were used for their personal investments. For example, Mahony used US$10 million (6.5 million pounds) to buy a house in his home country the United Kingdom. (See The Money Trail Flow Chart)

6. All these point to a clear case of fraud and international money laundering. 1MDB’s money went from Malaysia to Switzerland via US clearing banks and then to the United Kingdom, the UAE and Singapore.

7. What happened to 1MDB’s money is no longer a domestic issue but is a global fraud and money laundering matter involving the United States, the United Kingdom, Switzerland and Singapore. Global banks like JP Morgan, RBS Coutts, Credit Suisse, HSBC, Citibank, Deutsche Bank, BSI and others have all been channels for the money flow.

Covering the US$2.23 billion hole (Original US$1.83 billion cash & US$400 million paper profit) hidden as units in the Cayman SPC via the US$2.23 billion payment to retire the Aabar options

Key Findings:

1. With the US$1.83 billion cash 1MDB invested with PetroSaudi Holdings Cayman all gone, how then can it cover the hole plus the so-called US$400 million in declared profit that it was supposed to have made?

2. By 2012, all the US$2.23 billion was captured as Murabaha notes issued by PetroSaudi. It was later “redeemed” for a 49% stake in PetroSaudi Oil Services Ltd (PSOSL). [JMD notes: based on their own website, PSOSL was only created in 2009; the year 1MDB entered a business scam venture with PetroSaudi]

3. On Sept 12, 2012, 1MDB “sold” this 49% interest in PSOSL to Bridge Partners International Investment Ltd for US$2.32 billion. Bridge Partners International did not pay cash but issued promissory notes as payment.

4. On the same day, 1MDB through its subsidiary Brazen Sky Ltd, invested these US$2.32 billion of promissory notes in a fund called Bridge Global Absolute Return Fund SPC which was managed by Bridge Partners Investment Manager (Cayman). According to its prospectus, the fund makes high risk investments and investors can lose all its money. [JMD notes: And according to the latest discovery, the Cayman fund was only registered and licenced in November 2013, more than a year after it was ‘invested’ in the SPC].

5. The actual value of the US$2.32 billion kept in the SPC was unverifiable and the dispute 1MDB had with its then external auditor over this was the reason why KPMG was sacked for refusing to sign off the accounts for FY March 31, 2014.

6. Throughout 2013 and 2014, 1MDB’s board of directors had pressed its management to redeem the money from Cayman, because it was getting worried over the increased scrutiny by its external auditors.

7. Disputes and disagreements between 1MDB and Ernst & Young and then KPMG were primarily over the inability of 1MDB and Bridge Partners Investment Manager to provide enough proof that the fund was worth the US$2.32 billion ascribed to it or that they were readily realisable to be categorised as Available-For-Sale Investments in the audited accounts.

8. Subsequent to this, Aabar Investments stepped in to guarantee Bridge Partners International’s US$2.32 billion debt to 1MDB held as units in the Cayman SPC.

Covering The Hole:

1. In 2012, the International Petroleum Investment Corp (IPIC) of Abu Dhabi was given an option to subscribe to 49% of the future listing of the power assets owned by 1MDB. This 10-year option, which was later transferred to IPIC’s associate Aabar Investments, was for co-guaranteeing two bonds totalling US$3.5 billion that 1MDB issued.

2. In May, 2014, 1MDB and Aabar signed an agreement to terminate the options. This was stated in Page 172 of 1MDB’s FY2014 accounts but no details were given.

3. In page 169 of the FY2014 accounts, it was stated that 1MDB had obtained a bridging loan of US$250 million to buy back the options.

4. In page 171, it was stated that on Sept 2, 2014, Aabar had written to 1MDB that it wished to terminate the options according to the terms set out in the agreement signed in May. Again, no details were given.

5. 1MDB has never given out enough details of the terms and costs of terminating the Aabar options. But 1MDB appeared to have paid Aabar the following as termination costs:

i) US$250 million paid in May, 2014

ii) US$975 million paid in September, 2014 via a Deutsche Bank loan [JMD notes: This loan was paid by IPIC in June 2015 on behalf of 1MDB in return for 1MDB’s assets not yet identifiable]

iii) US$993 million paid in November, 2014 via a partial redemption of the Cayman SPC funds.

6. This adds up to a total of US$2.22 billion.

7. The scheme to cover the US$2.32 billion hole at the Cayman SPC is by paying Aabar US$2.22 billion as option termination fee. Aabar then passes the money to the Cayman SPC from which 1MDB would then be able to redeem the money, thus covering the money that was already gone.

8. The termination fee totalling US$2.22 billion that 1MDB paid to Aabar between May and November, 2014 was, however, not reflected in the FY December, 2014 of IPIC (which owns 100% of Aabar) as income or revenue. There were no such entries in IPIC’s accounts. This reinforces our analysis that the termination fees paid to Aabar were in reality used to cover the hole at the Cayman SPC. [JMD notes: This was confirmed by Wall Street Journal scoop where IPIC sources were quoted that they did not receive any of the money]

The rest of the recap can be read here.

You might also want to read:

1) The Money Trail Flow Chart

2) 1MDB’s Cayman “units” could not have been “redeemed” : Mahathir was right, the USD 2.2 billion is all gone

3) PSOSL did not exist and never owned any assets before 2010

4) Australia’s ASIC finds no evidence of 1 MDB’s Cayman units

5) 1MDB and the ‘donation’ issues are just the immediate causes, we have more reasons to change

6) Saving Prince Turki: UK regulator looks away in matter involving Turki Abdullah Al-Saud

7) Malaysia’s 1MDB Fund Scandal Spreads to U.A.E.

8) 1MDB – more questions on missing billions

9) Australian Investigation Further Confirms 1MDB’s Cayman Con-Trick

#1mdb, #malaysian-corporate-matters

1MDB “units” were so worthless, its value has to be guaranteed by a third party

This is a simple article. Please do not be intimidated by reading it. It’s a story of how billions of ringgit which came from bonds guaranteed by the Government, ended up being a worthless paper trail.

Perhaps you can share this story with your friends.

Once upon a time in 2009, 1MDB obtained RM5 billion from a bond issue called the Islamic Middle Term Notes. This amount is guaranteed by the Malaysian taxpayers (aka the Government) should 1MDB fails to repay the amount. (source)

As the name suggest, this bond must be used according to Shariah principles and the assets purchased must be endorsed by a Shariah Adviser. (source)

1MDB announced in 2009 that they will use this money to “participate in business and economic opportunities which result in the enhancement and promotion of the future prosperity and long-term sustainable economic development of Malaysia.” (source)

Q: Where is the RM27 billion? A: Sultan Pahang supports me

I don’t think I am the Shariah Adviser of 1MDB

In other words, the taxpayers of Malaysia is guaranteeing a debt of which the money must be used by 1MDB to invest in Shariah compliant assets which could trigger a prosperous and sustainable economic development in Malaysia.

Is this simple enough to understand? Good.

All seems great at that time, but what the public and the financial regulatory bodies such as Bank Negara Malaysia and Securities Commission didn’t know was, 1MDB had other intentions in mind. (source)

It turns out, from the period of 2009 to 2011, a total of USD1.83 billion of our money was given to an obscure company which had no track record whatsoever prior to 2009. (source)

This company is called PetroSaudi. It was a fairly inactive company when 1MDB started its joint venture with them. (source1, source)

How and why the Malaysian Government entered into an agreement with a company with no track records and no discernible assets is baffling. And why they agreed to give them billions is even more so. (source1, source2, source3)

Furthermore, public records have shown that USD700 million (approximately USD3 billion in current currency rate) out of the USD1.83 billion cash given, was transferred into a company called Good Star Ltd. This was never denied by anyone. Is sending money to Good Star Ltd in compliance to Shariah principles? What is their business activity which merited them to be given USD700 million of taxpayers money? (source)

Please don't ask me where the actual cash went

Please don’t ask me on what the actual RM5 billion cash was used for

Anyway by 2011, the cash USD1.83 billion was recorded as a loan to PetroSaudi. We don’t know what they do with the cash since the joint venture was terminated a year earlier in 2010, barely 6 months after it started. Usually when a joint venture was terminated, logic dictates that 1MDB must get all of its money back as soon as possible and invest it somewhere else more economically substantial. But 1MDB did the most crazy thing – continue loaning them money. (source)

1MDB even had the audacity to say that the money given to PetroSaudi can be used at that company’s discretion and they have full rights to do as it please. (source)

Basically, our taxpayers’ money which should have been used to develop Malaysia according to Shariah principles is being treated like a foreign company’s personal fund. We taxpayers must not question it.

Now by 2012, this loan to PetroSaudi which started from a failed joint venture business, was transformed into a 49% equity stake in PetroSaudi’s subsidiary worth USD2.22 billion. The USD1.83 billion was actually revalued upwards to USD2.22 billion. There was no cash profit at this time, only revaluation on paper. USD2.22 billion (approximately RM9.5 billion in current currency rate) is roughly as big as Sapura Kencana’s share capital. But 1MDB owned this company with such ease, coming in and out of it in barely four months. First they owned 49% of it in June 2012, then they sold that huge chunk of equity in September 2012. (source)

That huge chunk of equity was transformed yet again into ‘promissory notes’ when 1MDB sold their equity holding to an obscure fund management company called Bridge Partners from Hong Kong for USD2.318 billion. There was no cash changed hands. Only assets on paper. (source)

Let’s recap what we have so far. From cash obtained through Shariah debts, the taxpayers’ money has now become ‘promissory notes’. There goes the initial objectives of prospering Malaysia through sustainable economic development in Malaysia. The actual physical money has gone into Good Star and PetroSaudi.

1MDB now realised it has a few papers called promissory notes in its hands. They could not exchange it for real money anywhere in the world. So it then gave the ownership of those notes to its newly created subsidiary called Brazen Sky. Brazen Sky then gave those promissory notes to Bridge Global Absolute Return Fund to be ‘invested’ in Cayman Islands in the form of fund units. And now it seems, even Bridge Global did not have the necessary licence, or did not even exist when the transaction happened. (source)


HAHAHAHA as long as I got paid, why do you need to worry?

No wonder the whole Ministry of Finance including 1MDB’s clueless new boss were confused about this whole dodgy transaction. Was it cash, was it paper assets, or was it units? They themselves were confused by their own sneaky endeavours.

Now the USD2.318 billion question is, does the fund units have value? The answer is no and here’s why.

1MDB’s previous auditor (KPMG) had refused to sign off the accounts unless 1MDB can give proof of their marketable value. 1MDB could not. KPMG was sacked because they did not want to sign off the accounts. 1MDB then had to appoint another auditor (Deloitte) and had to ask their other partner in crime (Aabar/IPIC) from another joint venture to guarantee those units. Only then the new auditor was comfortable enough to sign it off. (source)

To put matters into perspective, this is akin to putting your RM1,000 into an ASB unit trust account but after some time, you can’t be sure if RM1,000 is still there, you simply had to get a third party to guarantee it! (source)

But some deluded people are saying that this is a good thing and that the very act of guaranteeing the units confirmed that those so called billions of units were not worthless. Perhaps they should look up for the words ‘guarantee’ and ‘guarantor’ in the dictionary. Perhaps they are out of their mind. If you hear anyone is saying these units have value and is profitable, please do not employ them anywhere in your company. Otherwise all your company cash might end up as units too! Then you are going to have an icky situation of paying staff salary using units instead of cash. If your staff ask ‘what are these units?’, just casually tell them, ‘they are units, just units’. (source)

Note that in exchange for  rescuing 1MDB many times, IPIC will be given assets belonging to 1MDB by June 2016. What these assets are, 1MDB and its lackey the Ministry of Finance have not answered to the public. Do you think IPIC will just help you (the taxpayers) for free? (source)

KPMG was right in not signing off those accounts while those vague USD2.318 billion worth of investments is left pending and unverified. They seriously do not want to follow the footsteps of Arthur Andersen accounting firm in the Enron financial fiasco. There are many instances when Audit Firm were caught colluding with their clients just for the sake of not losing the audit fee. (source)

There are other equally dodgy matters that had crept out due to the bungling of this so called ‘units’ that happens in the period of 2014 to 2015. But we shall save it in another simple story later.

The end.

You need to read these too:

1) The Idiot Guide to the Illogical Kandasamies of 1MDB

2) Decoding One of 1MDB’s Most Controversial Investments

3) Auditor General’s Report Proves KPMG Refused To Sign Off 1MDB’s Cayman Island Fund

4) 1MDB Board unhappy over hasty deal

5) Why RM13 billion Cayman Islands 1MDB investments may not be worth much

6) 1MDB denies evidence of their wrongdoings by issuing… some words.

7) 10 questions for 1MDB Chief

#1mdb, #malaysian-corporate-matters

“1MDB, please answer simple questions first”.

There was a series of simple but important questions to Arul Kanda, written by a member of the public and published in the Malaysian Insider today:

I refer to Arul Kanda Kandasamy’s statement on 1Malaysia Development Berhad’s (1MDB) rationalisation plan, debt equity swap, asset/equity sales in TRX and Bandar Malaysia and its ability to pay off interest charges and debt obligations on time.

I am just a layperson trying to understand, so please forgive me if I have misconstrued.

Are we supposed to be proud of all these measures mentioned by Arul Kanda, ie. 1MDB now has a rationalisation plan, is able to pay interest charges and debt obligations on time and is selling more of its valuable assets/equities to raise cash?

How did a strategic company set up with massive government support end up talking about rationalisation plans and paying debts and interest charges every day?

Frankly, I have a problem understanding 1MDB’s business model. The company initially raised lots of debts to buy so-called strategic assets. Now it is selling these assets to pay off debts. So what exactly are these guys in 1MDB doing, really?

I thought 1MDB had obtained the assets at good value, like those at TRX and Bandar Malaysia (let’s forget the energy assets for the time being). I thought these assets would have catapulted 1MDB to stardom. But why are they carving up the lands slice by slice and selling it off to raise cash to pay off debts?

I just don’t understand, I thought most of us would want to start a corporation to make money and to create value. But in 1MDB’s case, it appears to me that the corporation started with debt rationalisation before it made anything. Now it is happy just to sell assets to pay off interest charges and debts obligations or to indulge in debt equity swaps to keep the creditors at bay.

I don’t know, all this sounds very odd to me. We incur debts to buy assets. Having done that, we should make use of these assets to make profits to pay off debts. But in 1MDB’s case, why borrow to buy assets and then sell assets to pay off debts? In between, it incurred massive finance charges. May I know what business 1MDB has been doing all these years?

I have one final question – please forgive me again if it sounds superficial. By the time 1MDB has cleared off all its debt obligations, will there be anything left to the company, notwithstanding the “assets greater than liabilities” mantra?

If it has very little or nothing left, can we then say the lands in TRX and Bandar Malaysia were given to 1MDB for nothing?

TK CHUA – 28 October 2015

Let’s call a spade a spade shall we? This ‘rationalisation plan’ is just a fancy word for insolvency and asset stripping. 1MDB has all the signs of a company facing bankruptcy.

That is why, they had to get an outside help to pay their debt interests. Why can’t the Government be honest with this fact?

1MDB has suffered an acute cashflow problems which unable them to pay their debt interests on time. This is true in 2014 when they had to apply more than one extension on the interest payment due date.

I'm here to give out silly smiles while talking nonsense in the hope that the public is dumb enough to believe my hyperboles

I’m here to give out silly smiles while talking nonsense in the hope that the public is dumb enough to believe my hyperbole

It was all over the news back then. What happens if an average man failed to pay his car hire purchase loan on time, say 3 months late? The car will be repossessed.

What happens if a business failed to pay interests on time, say 5 months late? In the case of 1MDB, they will get extensions, and get a bail out of RM950 million from the taxpayers and then, get a foreign company to pay for them more billions in exchange for the assets originally owned by Malaysians.

1MDB is actually a stinky, debt-laden non-performing giant, which could not even muster enough money to pay for their debt obligations. Yes they could pay their debts on time, but only after a few extensions and in some instances not by their own money, but through other people’s pockets.

The best part is, Malaysians gain nothing out of 1MDB. The money obtained from selling those assets will be used to pay off debts. It won’t go into the nation’s coffers or back to the taxpayers. The bankers will get the money and be smiling all the way through the next decade as 1MDB struggles to reduce the billions of debt it has amassed needlessly.

Did the management of 1MDB get the sack out of this? No, their former CEOs and BOD as well as their stupid board of advisors are happily smiling away as if nothing has happened. They trumpeted this ‘rationalising plan’ as if it was a job well done.

They are also trumpeting some gibberish notion that ‘any wrongdoing, if any will be dealt with’. That is another hyperbole which epitomises lack of accountability. How can you deal with any wrongdoing when the suspects are placed high up in the political pyramid?

When you have no accountability, it will destroy your integrity. Once your integrity is gone, you will have no more credibility. When you have no credibility, nobody will even trust you. 1MDB excels in this department.

From now on, who would want to do business with 1MDB? Only TNB is dumb enough to pick up the hot steaming excrement that 1MDB had left behind. Other companies dealing with 1MDB can do some arm twisting for the prized-jewels – the lands once belonged to the Government.

Plus, who could trust 1MDB when they acted so nonchalant in ignoring the rules of its own central bank? For example, do you want to invest in a UK company which had breached and ignored the rules made by Bank of England?

TK Chua above had summarised his questions in such clear manner which had exposed how stupid 1MDB really is. Yet, the Government especially the people involved in it are desperately showing signs of denial. To claim that 1MDB is a job well done, instead of a massive failure transcending leadership, good governance, commerce and rule of law is imperative for one’s political survival.

Honesty, the decency to tell the truth and be responsible for it, is truly a lost virtue among this political leaders and their corporate lackeys.

You may also want to read:

1) Malaysia’s 1MDB secures second extension on $1.9 bln loan

2) Bibir Manis ! – Kemahiran Najib dan Arul1MDB Yang Tidak Dapat DiSangkalkan

3) Hutang IPIC USD481 Juta – Najib Tak Tipu la..

4) Malaysian Government pretends 1 MDB does not exist.Budget 2016 a worthless document for the exclusion

5) Ringgit falls as Fitch warns deficit target may be out of reach

6) Lemahnya Hujah Wakil Rakyat BN di Parlimen

7) Why is Najib still PM?

8) 1MDB Said to Seek Another Loan Extension Before $3 Billion Energy IPO

9) Bank Negara powerless to act on 1MDB loan extension request

#1mdb, #malaysian-corporate-matters

Zeti of BNM fights on while Ranjit of Securities Commission did not even bother

Kudos to Tan Sri Zeti Akhtar for having the gumption to do what is right pertaining the fraudulent activities executed by the unethical 1MDB management back in 2009.

In the press statement by Bank Negara Malaysia on 9th October 2015, it was clearly said that 1MDB had supplied inaccurate information during their application to remit money overseas. This had violated the Exchange Control Act 153 (ECA).

The excerpt of the statement is as below:

The Attorney General’s decision with respect to the investigations on 1Malaysia Development Berhad (1MDB) relates to Bank Negara Malaysia’s recommendation to initiate criminal prosecution against 1MDB for breaches under the Exchange Control Act 1953 (ECA).

The Bank at all times expects full and accurate disclosure of information by applicants in considering any application under the ECA. On its part, the Bank concluded that permissions required under the ECA for 1MDB’s investments abroad were obtained based on inaccurate or without complete disclosure of material information relevant to the Bank’s assessment of 1MDB’s applications.

What was the incorrect information given by 1MDB?

It was exposed by Sarawak Report that 1MDB had told BNM that the billions of ringgit that was to be remitted for their overseas investment is specifically for investing in a public listed company in France in September 2010.


The BNM investigation document published by Sarawak Report

But what happened after BNM had given their approval was nothing short of extraordinary. 1MDB went on to give loans to PetroSaudi eventhough the business joint venture was already terminated 6 months earlier.

Application to remit another USD330 million was also made by 1MDB in May 2011 and BNM recorded the reason for this is to pursue foreign direct investment into Malaysia.

The BNM investigation document published by Sarawak Report

The BNM investigation document published by Sarawak Report

But did Malaysia obtain a lot of FDIs for this? We all know it did not happen. Again, 1MDB had infamously given this huge amount of money to PetroSaudi as a loan, which in the end had strangely turned into units which in the 2014 audited accounts, they were so worthless, its value had to be guaranteed by Aabar.

It’s like putting your RM1,000 into an ASB unit trust account  but after some time, you can’t determine the value of your own investment, you simply had to get a third party to guarantee it!

Imagine, you need to get someone else to guarantee the value of your own money in order to lend credence to your investment. Laughable right? But that is what happened and what Arul Kanda had often smiled sheepishly about.

Of course, Bank Negara only realised this much later and in June 2015, they released a press statement that they have commenced investigations on 1MDB pertaining the cross border movement of funds exceeding RM50 million.

Rightfully, by October 2015 BNM had revoked the initial permissions granted by them and had ordered 1MDB to repatriate the USD1.83 billion to Malaysia.

The wrongdoing is crystal clear but 1MDB was not prosecuted because the Attorney General deemed that BNM was at fault in not asking further clarification! The stench of if all was overwhelming. Instead of penalising 1MDB, it was BNM who got lambasted!

Minutes of 1MDB BOD paper published in Sarawak Report

Minutes of 1MDB BOD paper published in Sarawak Report

The best part is, 1MDB never denied that the documents and the findings were not authentic. They are more concerned on how the documents were leaked, as if they have not done anything wrong at all.

Then there was the matter of that USD700 million which went into Good Star Ltd. This huge pile of cash went into a company which even the 1MDB Board of Directors did not know of. The BOD was furious and had asked the 1MDB management to seek the return of this taxpayers money.

Minutes of 1MDB BOD paper published in Sarawak Report

Minutes of 1MDB BOD paper published in Sarawak Report

Where did 1MDB got this money? From the RM5 billion bond they have received back in May 2009. This bond was called the Islamic Medium Term Notes (IMTN) and was issued when 1MDB was known as the Terengganu Investment Authority.

1MDB’s first business venture was to have a meeting in a yacht with the owners of the then obscure company called PetroSaudi.

This IMTN bond which was fully guaranteed by the government can be categories as taxpayers money. Because in the event of a default, it is the taxpayers who had to pay for it. Since BNM had revoked the permissions, this should trigger red flag from other regulators.

One such regulator is the Securities Commission (SC).

The SC is the controller of bond issuance process. And they also ensure compliance to documents when the bond was offered. Below is the term sheet for the IMTN and the purpose stated when it was issued:



Clearly shown the principal terms and condition of the loan is to be utilised in compliance to Shariah principles

Is sending money to Good Star Ltd in compliance to Shariah principles? What does Good Star do? Selling hijabs to Hollywood celebrities during lavish birthday parties?

Plus, is putting the USD1.83 billion in Cayman Islands in compliance with Shariah principles? Are the units endorsed by a Shariah Adviser? Is the Hong Kong based Bridge Partners which ultimately managed those worthless units a Shariah compliant company? The bond is called the ISLAMIC medium term notes guaranteed by the Government, not It’s My Daddy’s Money So I Can Do Whatever I Want With It.

Many rules, act and terms were broken here yet there weren’t any noise coming out from Securities Commission. The data and goalpost have been changed unilaterally by 1MDB’s management yet the supervisory body like Securities Commission did not even make a squeak.

The latest press release by Securities Commission was about an audit partner who was charged by SC for giving misleading information when auditing a client company. They have never made any press release regarding 1MDB’s blatant misused of the bonds, nor have they commence any investigations after BNM had announced about the fraudulent dealings made by 1MDB.

Is Datuk Ranjit unaware of the situation?

Will this Executive Chairman of SC wake up from his slumber?

Will this Executive Chairman of SC wake up from his slumber?

Any other companies which had violated the rules by the SC will be quick to be charged. But since June (when shit hits the fan), there was no movement, no initiative taken by this supposedly infallible and highly credible institution.

Alas, only time will tell if this Malaysian regulatory body will become as wayward as the other institutions under this unscrupulous government, or maintain its high standards and integrity in the face of difficult times ahead.

A heroic woman from Bank Negara Malaysia had shown the way. We are sure it won’t be too hard for a man in Securities Commission to do a man’s job.

You might also want to read:

1) WSJ: Auditor only closed 1MDB’s books after UAE firm guaranteed US$2.32b in Caymans

2) The chronology of 1MDB’s suspicious joint venture

3) The Attorney General defends 1MDB

4) EXCLUSIVE: Furious 1MDB Board Demanded Back Jho Low’s US$700 Million Five Days After JV Was Signed!

5) 1MDB – more questions on missing billions

6) Pergolakan politik atau kesalahan jenayah?

#1mdb, #malaysian-corporate-matters

10 Reasons Why Najib Razak And His Regime Is The Worst

The Prime Minister is no longer respected and his position has become untenable since last July. We even had an instance a couple of weeks ago where an accomplished young man had called the Prime Minister a national disgrace.

Truly, even among the youth, his reputation is widely seen as tarnished.

A recent survey had produced an unsurprising result – that 4 out of 5 Malaysians are unhappy with the Prime Minister. Approval rating has sunk to an all time low of 31%.

How could this happened?

Here are the reasons why this Prime Minister and his regime is the worst collection of leaders this country has ever had.

  1. They slander people and shamelessly lie to the public when caught with a blunder. For example, when Wall Street Journal broke the story that billions went into the Prime Minister’s private accounts, the first thing he did was to slander Tun Dr Mahathir and claimed the story is a lie. In his own words, he said “the latest allegation is that I have taken state-linked funds for personal gain. I believe Tun, working hand in glove with foreign nationals, including the now discredited political attack blog Sarawak Report, is behind this latest lie.”  Although WSJ never said he used it for personal gain, he shifted the goalpost by saying they accused him of that. He even made a remark that if he really wanted to steal the money, he won’t do it in a local bank, just to reassure the public that no money went in into his personal account. But events afterwards proved the money did go into his accounts and all the slander and lies he concocted were exposed.
  2. ghj

    The infamous freudian slip

    His next move in trying to prove that he did not receive any money is to publicly declare that he will sue WSJ. But this also ended in a whimper when after so many months have passed, Najib still cowardly refrained from suing WSJ. For all the stupid excuses made to justify why he hadn’t done so, people around the world already knew that there is no need to sue WSJ because all their allegations were proven right after all. Indeed, his second pathetic attempt to sue a veteran politician over an allegation that public money was funneled into his private accounts also ended rather flaccidly.

  3. The above two reasons should already disqualify him from being the Prime Minister, but it did not deter his sycophants in urging him to stay on. Shameless and unrepentant can aptly describe the Prime Minister and his regime. Another reason to show why this is the worst administration ever is when Najib, with a straight face said that 1MDB won’t be using public money to bail out 1MDB. This is an outright lie because it is a well known fact that 1MDB received RM950 million standby credit from the Ministry of Finance to service its debts. That money is of course, public money. And at one event in Johor, he even said that 1MDB has not incurred any losses! How desperate can one be? If that’s the case, then the RM665 million loss in 1MDB accounts for the year 2014 must have been a success according to his standards. Another shocking statement made was the “we must not borrow money to develop projects” which he uttered three days ago. Perhaps he should look in the cesspool known as 1MDB and drown himself in there. What kind of a leader is this to make such statement? And some people still support him?
  4. Maybe this Minister of Finance doesn't know finance

    Maybe this Minister of Finance doesn’t know finance

    One stupidity this regime is showing the whole world is their way of defending Najib Razak. When RM2.6 billion was proven to be inside his personal accounts, they made a diversion by saying that it is acceptable for a PM to get ‘political donation’ into his bank accounts! Probably the law that makes this permissible exists only in a twisted world called “Najibland”. Anti-corruption organisations across the world looked at this issue with horror and called it ‘grand corruption’. On top of that, Najib Razak actually challenged the opposition to reveal their source of political donation before he can reveal his! Continuing the tradition of being an overeager cockerel which bolted at the first sign of trouble, he became quiet like a mouse, probably suffering amnesia and forgot all about his challenge when Bersih 2.0, one of the opposition groups had declared and presented their accounts and political donation to the public. Is this a trait of a good leader? Certainly not.

  5. And didn’t we all feel ashamed but laughed real hard when the Prime Minister went missing during the Nothing2Hide event? They were citing ‘security reasons’ for his cowardly non-attendance; the same excuse given for him not to attend and officiate the International Anti-Corruption Conference last month. What a disgrace. How can Malaysians accept a leader who is not brave enough to face an audience? Even now he doesn’t accommodate any Q&A session with reporters for fear of facing tough questions. In fact, in the current Parliamentary session, any questions regarding 1MDB and the RM2.6 billion ‘donation’ are either rejected or delayed. This is how a scared regime would typically act when asked to stand up and face the music. Is this Government capable and has the credibility to face any economic and national challenges? Trying to portray itself like a thug but in actual fact, a scaredy-cat? Some of these people even thought that the act of sacking the AG for probing the wrongdoing, and sacking a Deputy Prime Minister for asking too many questions is a courageous behaviour! Laughable indeed. The Government is acting like a spoiled brat with too much power in his hands.
  6. One pensive and two smiling puddings

    One pensive and two smiling puddings

    Speaking about spoiled brats, what about the recent press release of SRC International which tried to whitewash their activities by telling the public that all the RM4 billion they received from KWAP are accounted for? Again, just like 1MDB, its little brother did not furnish any proof. Indeed, a multi billion company like SRC do not even have a website. Last checked, their website is still under construction! What kind of secret business deals are they doing inside there? Their accounts are not even available to public. SRC International had the audacity to say “we call on those quarters who are engaged in efforts to overthrow the government to desist from involving SRC in their political campaign and to avoid making false and unsubstantiated allegations against us.” Just like 1MDB, SRC International seems to be issuing political statements when they did not provide evidence to prove their innocence. The proof in the pudding is in the eating. And the pudding in the form of Nik Faisal Nik Amir and Datuk Suboh Mohd Yassin are missing and hiding from being investigated. SRC’s press release is moot and lack credibility when their directors are hiding like escaped fugitives. The Prime Minister could have called these friends of his to return home and face the law, but he did not. The MACC is left on the lurch and the investigation into the RM42 million of SRC money that went directly into the Prime Minister’s personal bank accounts is seriously delayed.

  7. "I should have turned down the deputy ministerial post, but I have no principles, that's why!"

    “I should have turned down the deputy ministerial post, so that there won’t be any delays”

    Yes, investigations were forcefully delayed by the actions by Najib Razak but his newly appointed PAC chief, Datuk Hasan Arifin stated that it is only ‘perception’ by the public that the 1MDB investigations are hindered. The public is appalled by the statement made by this idiot. Here is the proof that the delays in 1MDB investigations are not just about perception – the previous PAC Chief, Datuk Nurjazlan had promised in the month of June that PAC will interview Arul Kanda and Shahrol Halmi in August, this is because, both of those cowards had asked for deferment in their interview sessions. But that did not happen because the PAC was dismantled at the end of July. Now is already the month of October. Has PAC interviewed those wanted men? So for Hasan Arifin to stupidly say there are no delays is just mindboggling. Is this the kind of leadership you can trust?

  8. The other reason is the economy. This regime seriously do not know what to do with it. Their first action after months of sitting on their thumbs is to establish a special committee to tackle the current global market crisis. After the ringgit had plunged to an all time low for more than a decade, their solution is to use RM20 billion of public money in the form of funds from PNB, Khazanah Nasional and KWAP (again) to boost up the stock market. This had artificially led the stock market to rise up momentarily because retail investors are buying the shares anticipating the Government will go in and buy more shares in the market. Basically what the Government hope for is to “artificially boost the stock market in order to give the impression that the real economy is doing well”, so says an astute observer. Nazri Aziz, the clueless tourism minister even brayed like a village simpleton by saying that a weak ringgit will cause a tourist influx when a recent data had shown that the number of tourists are declining. There are so many things to say about this dithering economy perpetuated by Najib hanging on by his fingertips as the prime minister, but that requires a whole separate article.
  9. Lies, lies lies and more lies

    Lies, lies lies and more lies

    And the apparent lack of money is also a reason why this Government is the worst in financial management. At one point during the last general election, Najib Razak made a promise that tolls between cities will be reduced gradually. But the opposite happened. Instead of reducing the toll rates, his administration had hiked up the rates! Citing no more money to pay compensation to the toll concessionaires, Najib Razak and his regime shamelessly announced that the money saved can be used to build schools and hospitals. The kick in the teeth came from the announcement from the Works Minister where he said that the Government had to pay RM558.7 million in compensation if toll rates are not increased. Well, if 1MDB hadn’t have to be bailed out by the amount of RM950 million back in February, then right now there shouldn’t have been an increase in traveling costs for the public! In fact, back in 2011, this government had prolonged the concession on some of the highways which supposedly to end in 2018 and had revised it to 2038! Note that Najib Razak gave the same reason when they tried to impose GST – to build schools and hospitals. What happened to the GST’s billions? Also, the government should have saved billions when they canceled subsidy for petrol and sugar. Yet the prime minister is often heard crying like a baby how it is so hard to find money. People are starting to get panic. Why don’t you just keep quiet and do your job? Do you even understand the word ‘financial management’?

  10. And lastly among others, the fact that Najib Razak is unrepentant and oblivious to the mistakes he has made, is spectacularly recorded. This blog had written many articles on how he lacks common sense and the necessary intelligence to act like a proper Prime Minister. We have published articles lambasting him on many areas in the past. Some as early as 2008. Out of 114 articles written about him, 99% of it are critical. A few of it can be read as below:

But he continues to remain ignorant on the calls of his resignation. Surely the amount of hatred he received in his own social media platforms is a sign which he needs to heed. But apparently he only recognise his detractor in a form of just one man – Tun Dr Mahathir. And his modus operandi to defend himself? To tell the public that Tun Dr Mahathir is worse than him. In his mind, this makes Tun Dr Mahathir have no moral standing to ask for his resignation. But Najib is not accountable to only one person. He is answerable to the millions of people in Malaysia. Tun Dr Mahathir is just a messenger; he is not a prime minister anymore. To sully and badmouth a messenger means to insult Malaysians which had called for his resignation too. He even arrogantly advised his detractors to look at the mistakes they made in the past and “not only find fault in others”. So what kind of mistakes do the common people have that made them unworthy to call for his resignation? This kind of arrogance is clearly a product of hubris and miscalculated sense of popularity. After factoring in all the 10 reasons above, it is amazing to think that some are still supporting him to lead this country. Common sense is indeed a luxury these days. None of the cabinet ministers, the leaders in Barisan Nasional and all the fat divisional leaders in Umno have it.

You might also want to read:


2) 1MDB Kalau Labur Di ASB adalah LEBIH UNTUNG dan Lebih Selamat Dari Labur Dengan Petrosaudi! Duit Pun Masih Cash Bukan Just Unit..

3) 1MDB silap mata. How to make USD $2.33 billion “disappear”

4) Separation of Powers

5) The Idiot Guide to the Illogical Kandasamies of 1MDB

6) Urus Niaga 1MDB Luar Biasa Terus Bebani Malaysia

7) Najib is putting the people at ransom

8) The Chinese Dilemma in an Umno Problem

#1mdb, #malaysian-corporate-matters, #malaysian-judiciary, #reference, #twitter

1MDB denies evidence of their wrongdoings by issuing… some words.

At this point 1MDB can only act stupid.

Giving stupid answers just to fill the space in their official website.

Take for instance their latest press release.

Their first defence in investing money into Petrosaudi back in 2009 is to say that the key objective of it is to achieve a 40% equity stake in that ridiculous multi billion ringgit joint venture. This 40% equity costs Malaysia USD1 billion initially. But it doesn’t stop there.

PM Najib had often proudly announced that 1MDB had only RM1 million in capital when it first started, so where did they get billions of ringgit to pump in that USD1 billion in equity?

It came from RM5 billion debts issued in May 2009 when 1MDB was still called Terengganu Investment Authority (TIA). This company is the predecessor of 1MDB, with Jho Low as its adviser extraordinaire.

That RM5 billion Islamic bond was guaranteed by the Government and the purpose of obtaining them in the first place is for 1MDB to “seek, explore, and participate in business and economic opportunities which result in the enhancement and promotion of the future prosperity and long-term sustainable economic development of Malaysia.”

This supposed to be their key objective. But somehow due to the problems and the money lost, this objective has been changed to ‘obtaining 40% equity’.

Now what kind of future prosperity and long-term sustainable economic development in Malaysia has that joint-venture created?

It seems that in order to justify the USD1 billion given to Petrosaudi, achieving that 40% stake is now considered a success. The standard has been set so low, even a dodgy business deal is considered a job well done.

1MDB had proclaimed (without documented roof) that Jho Low had resigned from being an adviser prior to the name change from TIA to 1MDB. But photographs placing him and the prime minister together with the owners of Petrosaudi in a yacht cast doubt over 1MDB’s assertion.

Subsequent letters between the advisers of 1MDB and Petrosaudi had proven that the yacht rendezvous was where both parties had schemed for the joint-venture.

All sundry knows that Petrosaudi is an obscure privately owned company prior to the joint venture. Its website published no business deals and commercial news before the joint venture schemed was hatched. It only got active after 1MDB gave them the billions guaranteed by Government.

It was also proven via documents that Petrosaudi has no ownership of the assets it claimed to have!

So question is:

  • why did the Government enter into an agreement with a privately owned company with no track records and no assets?
  • why did the Government gave USD700 million to Good Star Ltd; without the approval from its Board of Directors? If 1MDB is too stupid to understand this, what were the services Good Star gave in return to Malaysians in order to justify this kind of payment?

The blabbering fools behind 1MDB propaganda machine kept on saying that the joint venture yielded USD488 million in profits. But these profits were in the form of units.

Any sane businessmen will say that if you make an investment at RM180 and sell at a price of RM228 in cash, then yes the profit that you make is RM48 in cash.

But in the case of 1MDB, the investment they pay in cash at RM1.83 billion (for promotion of the future prosperity and long-term sustainable economic development of Malaysia) changed form a few times, revalued in the form of equity (which nobody seems to know why) and suddenly when 1MDB wanted to sell it for cash, it was transformed into units at a new revalued amount of USD488 million higher than the original cash investment.

To some idiotic businessmen, this is a good deal to them. Put in cash USD1.83 billion, get USD2.318 billion of units. That is a USD488 million of extra units! But where is the cash? Where is the future prosperity and sustainable economic development in Malaysia? What can Malaysians do with that extra units?

Some idiots said that USD2.318 billion of units were used to pay debts. We doubt that. But if we do believe this, then why on earth would you give billions of cash to a company, which in the end, the ‘proceeds’ were just used to pay debts?!

That is like getting a RM1,000 loan, put that money in a company, a couple of years later, you use that initial investment + ‘profits’ to pay off debts! Why get a loan, to pay off loan, without doing anything substantial with it?

What kind of stupid ‘economic development in Malaysia’ strategy is this, 1MDB?

This is what Bank Negara Malaysia had ruefully complained and hoped that 1MDB be charged when they had given fraudulent information with regards to that USD1.83 billion investment. BNM wanted the money to be repatriated back because let’s face it, it was remitted into companies which did not fulfill the original objectives on why the joint venture and the RM5 billion debts had been created.

These are evidence presented to the public. Evidence in the form of official documents. Documents which authenticity are not being denied.

1MDB is only good at words but lack the substance and substantial evidence to prove them innocent.

Note that when in the US, Najib said that 1MDB business model is too idealistic and flawed. In other words, it is a failed business model. Only a stupid leader would proudly strut around for months claiming 1MDB is good where it started with just RM1 million in capital and managed to acquired billions of debts in the process.

You ought to read these to understand the whole issue:

1) Arul Spins A Changing Story As We Publish More Documents He Can’t Deny!

2) How 1MDB Board Was Tricked By Lies From A Management Working For Najib!

3) Furious 1MDB Board Demanded Back Jho Low’s US$700 Million Five Days After JV Was Signed!

4) JVA Was Signed Behind Our Backs — 1MDB Board Fury Further Explained!

5) What people know about 1MDB – PetroSaudi ‘assets’

6) Did Petrosaudi swindle 1MDB and steal our money?

7) How Jho Low & PetroSaudi schemed to steal money from the people of Malaysia via 1MDB

#1mdb, #malaysian-corporate-matters

The Attorney General defends 1MDB

Yesterday we had a glimpse of the Attorney General reading out a script prepared for his press conference. This was his first time facing the media after his sudden appointment replacing the previous AG at the end of last July. It is unfortunate that he declined to have a question and answer session for the media. Perhaps, the questions asked might be too difficult to answer.

Regardless, the AG Chamber had used the press conference to defend 1MDB against the charges made by Bank Negara Malaysia.

Using form over substance, instead of substance over form, the AG cited technicality rather than the spirit of the law in order to justify why he is not prosecuting 1MDB.

Below are some of the reaction by commentators regarding the statement from the AG in The Malaysian Insider today:

image5.PNGimage1.PNGimage3.PNGimage2.PNGimage6.PNGimage4.PNGThe reaction by the public reflects their ability to see through the smokescreen and the facade on what is more important. The issue at hand here is certainly not why BNM did not ask further clarification.

The issue is actually how 1MDB had subsequently renege on the motive in remitting the billions of money overseas. Substance over form. Instead of doing exactly what they had originally disclosed to BNM, the monies ended up in places not revealed to BNM until at a much later stage.

Note that this is the same AG which back in August had claimed that the task force investigating 1MDB has been disbanded and in its place, has renamed a previous task force which had investigated money related crimes, and this task force will not investigate 1MDB.

But after he was chided by the Royal Council last week, the AG backtracked to say that the task force was never disbanded and he had never made such statement to that effect!

Oh dear, the cock and bull epidemic that has plagued 1MDB and Prime Minister’s office has now infected the AG chambers!

Even the MACC confirmed in their August 5th press statement that the task force was disbanded.

If the task force was indeed never been dissolved, then why did one of the MACC bosses urged AG to reactivate the task force? More than that, he made a disclosure that the task force has not met since July!

The flip flop statements made by this government is embarrassing. We are already an embarrassment during the International Anti-Corruption Conference last month.

One young Malaysian even called our Prime Minister a national disgrace. And the fact that the giants in Malaysian politics are accusing the government for abuse of power is very telling.

The arrests of Malaysian citizens for making reports on wrongdoings of a government and charging them for sabotaging the economy is mind-boggling and cruel. Even the draconian ISA had never been used on people who made reports.

Perhaps the government is confident and believe that they have strong support from the people in the next general election. Nevermind the fact that the wife of the persecuted has about 600,000 followers on her social media account.

If only 10% of her followers decided not to vote for Barisan Nasional, the government will lose about 25 parliamentary seats it had won by under 2,000-vote majority.

Just like one veteran politician had said, “why do things that will only upset more people towards the government?”

Hopefully the AG will find it in his heart to do the right thing.

You might also want to read:

1) Auditor General to furnish report on 1MDB probe in 3-4 months

2) Police need 1MDB audit report to complete probe, IGP says

3) Two months left for Najib to settle 1MDB controversy, says Tuan Ibrahim

4) Najib’s Transformation Of Malaysia Into An American Satellite

5) 1MDB’s Cayman fund may not exist -Bridge Global Absolute Return Fund not listed among Avetsra’s funds

6) 1MDB lied when countering Mahathir’s Cayman fund claims (UPDATE)

7) Arul Kanda and 1 MDB say “rationalisation plan” is a sham – Something about IPIC swapping assets with itself

8) Yang Amat Arif Apandi’s SOSMA clarification means Moody’s, Standard & Poors can be charged with sabotage


#1mdb, #malaysian-corporate-matters, #malaysian-judiciary

Caught with their pants down, 1MDB is stumbling over their own deceit

1MDB made a police report yesterday, complaining about confidential documents being published by Sarawak Report.

This is the second time 1MDB admitted that the documents published in Sarawak Report were authentic. Note that 1MDB and the whole gamut of Najib’s propaganda machine had been frothing in the mouth for several months pretending to believe that Sarawak Report and the recently unbanned business newspaper, The Edge had been using tampered and forged 1MDB documents.

1MDB itself had never brought forth or identified which documents they have claimed as doctored. Whatever accusations they had thrown towards these whistleblowers were just a general assertion that some  documents were tampered. Which one? They have never pointed it out.

Thus, after explaining and admitting their mistake regarding Sarawak Report’s damning story on 9th October 2015, 1MDB was caught with their pants down again a few days later when the news portal published another explosive story.

When you can't cover it up anymore, make a police report

When you can’t cover it up anymore, make a police report!

Reading between the lines of their press release above, one can’t help to feel that finally, 1MDB has forced themselves to admit in defeat that the documents which had exposed their wrongdoings, were in fact, very authentic.

And just like their irrational business model, they are now acting in a manner defying logic – make a police report when somebody had exposed their law breaking activities.

For the sake of brevity, the story which had drawn such a ridiculous police report can be summarised as below. Each of the points were substantiated by documented evidence by Sarawak Report. Importantly, 1MDB did not deny any of it.

  • That Jho Low is an active Adviser for 1MDB since its early days despite him denying any involvement with the debt laden company.
  • How 1MDB cheated Bank Negara by giving false declaration when remitting the money overseas. USD1.83 billion were transferred based on false presumption. 1MDB even declared that some USD500 million was going to be used to invest in a French company!
  • Follow ups by Bank Negara to ascertain updates on the investments were often futile. In the end, 1MDB actually gave all their cash to Good Star Ltd; not PetroSaudi, as what their joint venture agreement had stipulated.
  • PetroSaudi had fraudulently claimed that they own oil fields in Turkmenistan when they really don’t. A valuation report was not done independently and was readied a day after the joint venture was signed.

Well the rest is history. We all know that USD1.83 billion of our cash were lost in transaction. Replacing them were the mythical units which carries no value at all. 1MDB really need to look up the dictionary for the word ’embezzlement’.

Note that Xavier Andre Justo, the ex-PetroSaudi director is now languishing in Thailand jail for blackmailing his former employer. One can only deduce that all the documents used so far to exposed 1MDB’s wrongdoings, are genuine. Logically, you cannot blackmail someone with fake documents.

This time around, unable to deny and issue anymore explanation, 1MDB had resorted to make an outrageous police report. The one that had misled BNM was 1MDB, yet they are making police report to cry foul over the sudden exposure of their apparent wrongdoings? Why is this company keep insulting our intelligence?

It is clear that based on the BNM’s investigation papers, 1MDB had breached the banking system by knowingly giving false statement. When people are asking why didn’t 1MDB be charged for the financial crime where the evidence against them are overwhelming, 1MDB had the gall not to deny their wrongdoings, but stressed that the more important issue is how did the confidential documents got published!

And today, the Attorney General issued a statement defending 1MDB’s right not to be charged under the Bank Negara laws. Basically, since Bank Negara did not inquire much during the time when billions were transferred out of this country, then there is no need for 1MDB to be punished!

The onus is solely on Bank Negara. Using an anology, this means if a person was brought in the house by good faith and he not state his real intention, but a few years later it was discovered by the owner that the said person had stolen a few items from the house, the thief cannot be charged by the law!

Paraphrasing the AG’s words – “If the house owner does not request for certain or specific information from the eventual thief, how could the thief be faulted?

To make it even more perplexing, the thief now is making a police report because someone had obtained the proof of him stealing!

And to reinforce this bizarre situation, a cabinet minister from Sabah said that since events in 2015 had superseded the alleged wrongdoings done in 2009 to 2011, the issue has become pointless and should not be dredged up!


This whole conspiracy to cover up is not lost on Malaysians. And people all around the world are watching too. The players actively trying to defend the financial crime and the lost of billions are making a mockery of the whole system.

You might also want to read:

1) Hiding 1MDB’s loss for financial year 2015?

2) Ooooooh, Patutlah BNM Arahkan USD1.83 Bil itu DiBawa Pulang ! Kencing Rupanya…

3) Dahlan says, Sir Wenger counters

4) Bilahari sees a Seance

5) Charging of 1MDB’s Whistleblower and Lawyer Condemned

6) Minit Mesyuarat 1MDB DiDedah – 1MDB Kantoi Lagi!

7) Zeti Says Malaysia Central Bank’s 1MDB Move Vital for Integrity

8) 1MDB or Najib should be charged, not Khairudin or Matthias

#1mdb, #malaysian-corporate-matters

1MDB’s response to former Deputy Prime Minister is misleading

We just couldn’t believe the level of absurdity 1MDB had subjected the people with its response to Tan Sri Muhyiddin Yassin just now.

The fact that they had the audacity in hoping that the people are dumb enough to believe them shows how desperate they have become.

Below is their response to Tan Sri Muhyiddin Yassin’s press release. Our comments in blue:

1MDB notes the press release issued yesterday by Tan Sri Muhyiddin Yassin. The characterisation of 1MDB as a “debt-laden company” is misleading, as Tan Sri Muhyiddin, a former Cabinet member, knows full well that the value of 1MDB’s assets exceeds its debt.

If people googled “1MDB debt-laden”, they will find numerous business articles about how 1MDB is swamped with debt which they are unable to settle on time. If you can’t even pay your finance costs totalling about RM2.4 billion per year, surely your ‘assets’ means nothing regardless if it exceeds your debt. The important thing is, the government had to fork out RM950 million in standby credit for you and you had to beg a foreign company to give another USD1 billion just to service your debts. Back in 2014, you even begged the banks to extend the payment deadlines a couple of times.

All this makes you debt-laden. It is you who tried to mislead the public by saying you are not debt-laden eventhough all evidence pointed out that you are. Your gearing is so high, your cashflow failed you. Please get a dictionary to know the meaning of ‘laden’.

This fact is reinforced by the significant value indicated by local and international investors for the ongoing sale of equity in Edra Energy and Bandar Malaysia.

The fact that you have to be broken up into separate entities and have to sell the assets you had heftily required just to alleviate your worsening financial situation reinforces the reality that you are indeed a debt-laden and problematic investment company.

As a Cabinet member when 1MDB was formed, Tan Sri Muhyiddin is fully aware of 1MDB’s capital structure. With RM1 million in equity from its shareholder, the Ministry of Finance, 1MDB raised capital on the markets – which is the debt on the company’s accounts.‎ Many businesses, both in Malaysia and abroad, have used debt to successfully build their asset base. In 1MDB’s case, from RM 1 million equity, total group shareholder equity of RM1.7 billion was generated as of 31 March 2014.

Many businesses around the world are perplexed as to how a RM1 million company could haphazardly tried to amass RM42 billion worth of debts. That is like a person with just RM1 went on to borrow RM42,000. Indeed, being idealistic is an understatement. It is bordering lunacy. On top of that, you then could not service the interests. What you fail to tell the public is that by 31 March 2014 you incurred a loss of more than RM600 million. Can we know what is the loss for 31st March 2015? We can’t because you are repeatedly late in submitting your yearly audited accounts.

Notwithstanding the subsequent and ongoing challenges, which are well documented and acknowledged, 1MDB remains confident of generating surplus value as we progress with the rationalisation plan.

What good is an equity surplus when you can’t even service your debt? Experiencing repeated losses will eat up your equity eventually. Hence, you will not have enough cash to pay your debts and fund your operations. You were behaving irrationally in your business which in the end, as disaster looms, you need a debt rationalisation plan to undo your nonsensical business model. If the people did not make enough noise in 2015, you might trudge on and drag Malaysia into a financial abyss.

1MDB regrets that, despite repeated clarifications, certain current and former politicians continue to issue half-truths about the company. It is now clear that this is part of a deliberate and politically motivated attack, to ‎sabotage not only our previously planned energy IPO but the ongoing implementation of our rationalisation plan.

The one that being political is 1MDB. Constantly behaving like a politician in trying to give misleading explanation, half-truths and covering up your mistakes. For instance, your IPO was planned to take off in 2014 but was delayed several times long before ‘certain current and former politicians’ had begun to criticise you. The failure to list Edra Energy was entirely your fault. You yourself sabotaged your business model with your own absurdity.

Despite this, 1MDB and our 100% ultimate shareholder, the Government of Malaysia, are fully committed to executing the plan, as presented to Cabinet on 29 May 2015.

Out of several points the former deputy prime minister had said about 1MDB in his press release, you are only harping about the word ‘debt-laden’. Even then you failed in trying to disprove it. But it is good you have recognised that your 100% owner is the Government of Malaysia thus, you are ultimately answerable to the people. The people can ask you questions or call your bluff. And what is more important is to know who was responsible for the financial fiasco that had costs taxpayers billions in standby credit and losses. In the end it is the people who had to bear the cost of this rationalisation plan. Therefore coming back to the accusation that the former deputy prime minister had been misleading; who is it now that was trying to mislead who? If only 1MDB had been honest in conveying the truth, accepting criticisms and their failures, and at least have an ounce of accountability towards the public, then we wouldn’t have this huge ‘trust deficit’.

Thank you.

You might also want to read:

1) AGC confirms binned two Bank Negara requests for action in 1MDB case

2) Akaun 1MDB Tangguh 6 Bulan – Apasaja Berkaitan 1MDB Mesti Ada Tangguh-Tangguh!

3) Sue them all for 1MDB defamation, Tee Keat tells Najib after court threat against Liong Sik

4) Top debater slams PM as a ‘national disgrace’


#1mdb, #malaysian-corporate-matters