Fizaman Noor Mohamad Nasir said as a dealer, he was only entitled to a cap of up to US$30 million a day.
“However, there was one occasion when I conducted transactions that amounted to US$800 million (RM2 billion) at the instruction of Nor Mohamed,” he told the five-man tribunal, chaired by Mohd Sidek Hassan.
He said the exchange rate then was US$1 to RM2.50, but did not specify the exact date or year in which the trading was done.
He said he was a dealer for Bank Negara between 1989 and 1998. The much talked about forex scandal meanwhile is said to have taken place between 1988 and 1994.
Fizaman, who was the sixth witness of the RCI on BNM’s forex losses, said that from his observations, the central bank management did make losses in forex trading.
“As a dealer, I made some profits but the amount was small,” he said.
He said the central bank’s forex trading during the period in question was intended to make large profits and was based on speculation.
“However, I do not know the total losses suffered by BNM during that period,” he said, adding that he did not enquire about the matter further from BNM’s banking department that was responsible for forex trading.
Fizaman said during his tenure as a dealer, he worked with three others and Nor Mohamed, who was director of the banking department-cum-adviser to BNM.
He said as a dealer, he would analyse the market based on the movements of the ringgit and foreign currencies like the US dollar, British pound, Japanese yen, Deutsch mark and Swiss francs that were traded globally.
“I also studied global economic conditions and gave my input to the management if requested,” he said.
The witness said his views were usually communicated to the chief forex dealer and Nor Mohamed.
Fizaman said he was initially given a limit of up to US$1 million but that this limit was later upgraded to a maximum of US$30 million a day.
He said although he personally viewed the currency market to be negative on certain days, the final decision to trade was in the hands of Nor Mohamed.
Before the setting up of the RCI, a task force had found that the central bank had incurred forex losses of at least US$10 billion (about RM44 billion at present value) between 1991 and 1993.
In June, the Prime Minister’s Office said the cabinet had agreed to set up the RCI as there was sufficient evidence to justify further investigations into the matter.
It said the RCI was to protect public interests by determining the extent to which the losses had affected national reserves.
The task force, which was set up on Feb 15, was also chaired by Sidek, a former chief secretary to the government.