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DAP alleges 1MDB RM3.2 billion debt bailout by Putrajaya

 | March 15, 2017

Finance minister’s convoluted answer on takeover of 1MDB’s real estate assets a blatant attempt to mask bailout, says Tony Pua

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PETALING JAYA: DAP’s Tony Pua has alleged that Putrajaya “effectively bailed out 1MDB” by as much as RM3.2 billion with the takeover of debts linked to assets under the state-owned investment firm.

The Petaling Jaya Utara MP said this appeared to have been revealed in an answer by the finance minister to a question he had asked last week in the Dewan Rakyat.

“I asked the finance minister to ‘list the 1MDB real estate assets taken over by the Ministry of Finance (MoF) and the consideration paid for them’.

“I also asked ‘did MoF take over the borrowings associated with these assets including, the RM800 million from Socso and RM2.4 billion in sukuk bonds’,” Pua said, adding that he only expected a simple “yes” or “no” reply, with the total borrowings assumed by the finance ministry, if any.

The DAP national publicity secretary said instead of the straightforward answer, there was a convoluted answer that pinned the blame for such a takeover on the Public Accounts Committee (PAC).

“To the second part of my question, the finance minister shifted responsibility to the PAC by quoting page 81 of the PAC report.

“Page 81 had stated ‘…the RM800 million borrowed from Socso by TRX City Sdn Bhd and RM2.4 billion in sukuk bonds by Bandar Malaysia Sdn Bhd will be managed and continue to be borne by the cash flow from the TRX and Bandar Malaysia projects.’,” Pua said in a statement released today.

This, Pua said, reveals that the finance ministry has also absorbed the debts associated with the assets that were taken over.

“It also meant that the Second Finance Minister Johari Abdul Ghani’s prior insistence to the media that there was no taking over of 1MDB debts planned over the assets takeover was a blatant lie.

“I then checked my own copy of the PAC Report because I didn’t recall any such recommendations.

“This was confirmed as the statement on page 81 was actually the proposal submitted by 1MDB to the PAC and not, a recommendation by the PAC!” Pua said.

Explaining the gist of his allegations, Pua said “Malaysians were being raped twice over” with the above transactions because these pieces of land were “sold” to 1MDB by Putrajaya at bargain basement prices.

“The land for the 70-acre TRX was priced at RM64 per square feet (psf) for a total of RM194 million, while the 486-acre Bandar Malaysia was at RM72psf for a total of RM1.67 billion.

“However, 1MDB has already sold parts of TRX to Tabung Haji and the Armed Forces Pension Fund-owned Affin Bank for more than RM2,700 and RM4,500 psf. In total, 30.5 acres of TRX was sold for approximately RM3.5 billion.

“At the same time, 40% of Bandar Malaysia had been sold for more than RM1,000psf. The proceeds of these sales have already gone into the pockets of 1MDB to service its mountain of debt unrelated to its property division,” he said.

He added that the people are now being made to pay a second time, with the finance ministry taking back the balance of the assets from 1MDB, but which are now attached with a mega RM3.2 billion debt.

Pua believes this is why former second finance minister, Husni Hanadzlah, decided to quit the Cabinet in June last year.

“The brazen bailout horrors which are taking place today are just mind-blowing – and the above refers only to the real estate transactions.”


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