Pua: Critics of 1MDB were right all along

KUALA LUMPUR: The tabling of the parliamentary Public Accounts Committee (PAC) Report on Thursday, with the accompanying transcripts of all its proceedings since 19 May 2015 in Parliament has now fully vindicated the critics, said Petaling Jaya Utara MP Tony Pua in a statement. “The findings of the Auditor-General, summarized in the 106-page PAC Report, and the relatively brief conclusion by the PAC confirms gross mismanagement and wanton neglect of all principles of good governance and accountability.”

The PAC Report has requested that former CEO, Shahrol Halmi Azral and other related parties be investigated for all of the shenanigans cited, and reprimanded the Board of Directors for their failure, noted Pua who is also DAP National Publicity Secretary.

The Inspector-General of Police must take immediate action to investigate Shahrol and his associates, demanded Pua. “I will go further to call not only for Shahrol Halmi to be sacked with immediate effect, but the entire Board of Directors who have failed to protect the interest of the government and the taxpayers to be removed as well.”

Most importantly, he lamented, 1MDB deliberately hampered the investigations by the Auditor-General and the PAC by giving half-truths, withholding of crucial information as well as defiantly refusing to supply simple bank statements on its overseas accounts to allow the audit of multi-billion ringgit money trails.

Despite certain shortcomings in the report like the failure to obtain the crucial information on 1MDB’s foreign banking transactions, and the failure to secure additional key witnesses like former CEO Mohd Hazem Abd Rahman, Bank Negara officials, auditors Ernst & Young and even controversial figures like Low Taek Jho, the evidence put forward based on available documents were overwhelmingly damning for 1MDB, pointed out Pua.

“This crucially includes the first joint venture agreement with Petrosaudi International Limited where 1MDB was meant to invest USD1 billion for a 40 per cent stake but USD700 million was misappropriated to Good Star Limited.”

“The AG’s Report also confirmed that besides the original USD700 million transferred in 2009, 1MDB further transferred an additional USD330 million to Good Star in 2011.”

The AG and PAC have also been able to establish multiple questionable transactions between 1MDB and Aabar Investment PJS Limited, which was established in the British Virgin Islands ‘Aabar (BVI)’,” said Pua. “It has been previously reported that Aabar (BVI) was granted 49 per cent options to acquire 2 power companies, Tanjong Power and Genting Sanyen, in exchange for International Petroleum Investment Corporation (IPIC) providing a USD3.5 billion guarantee for 1MDB bonds issued in 2012. These options were terminated in 2014.”

Based on the Option Termination agreement sighted by the AG, 1MDB was to compensate Aabar with a “refundable deposit” of USD300 million, noted Pua. “However, 1MDB reported that it has paid USD993 million to Aabar (BVI). (7.3.10)”

Worse, said the MP, the AG and the PAC has also been informed that besides the above, 1MDB paid Aabar (BVI) further sums of USD855 million and USD295 million as unexplained ‘top-up security deposits’ (7.3.13). “Under the original “Credit Enhancement Agreement” signed in 2012, 1MDB has already paid Aabar (BVI) USD1.367 billion. (7.3.9).”

What was damning is the fact that 1MDB could not provide any concrete documentary evidence that Aabar (BVI) was in anyway related to Aabar Investment PJS of Abu Dhabi, which is the subsidiary of IPIC, argued Pua. “The Auditor-General noted that Aabar (BVI) was not listed as IPIC’s subsidiary based on the audited accounts of IPIC. (7.3.11, 7.3.12).”

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