Oct 26 ruling for audit firm’s challenge to RM2.2 million fine over 1MDB-linked bonds

Audit firm Deloitte is seeking to quash the Securities Commission’s decision to fine it for breaching the Capital Markets and Services Act 2007. (AFP pic)

KUALA LUMPUR: The High Court here has fixed Oct 26 for a decision on the challenge by audit firm Deloitte against the Securities Commission’s (SC) decision to fine it RM2.2 million for breaching the Capital Markets and Services Act 2007 in the issue of bonds linked to a 1MDB unit.

The firm’s lawyer Malik Imtiaz Sarwar told High Court judge Mariana Yahya that they were relying on their written submissions in their judicial hearing, without oral submissions.

N Nahendran, representing the SC, did not object.

Mariana then said she would need time to read through the submissions and fixed October to deliver her decision.

“The court may seek clarification from parties but I will deliver a decision on Oct 26,” she said.

The RM2.2 million fine was imposed last year over four breaches related to the RM2.4 billion Sukuk Murabahah Programme issued by Bandar Malaysia Sdn Bhd (BMSB) in 2014.

1MDB is the holding company for BMSB.

The SC said Deloitte committed two breaches under Section 276(3)(b) of the Capital Markets and Services Act by failing to immediately report to the authorities irregularities which could have had a material effect on Bandar Malaysia’s ability to fulfil its obligations in repaying sukuk holders under the programme.

Deloitte meanwhile said it had filed a judicial review against the SC’s decision to impose a fine.

It said the move breached the rules of natural justice and that the charges framed in the SC’s show cause letter were vague and ambiguous.

It also said it had paid the RM2.2 million fine last year but that this was done without prejudice to its right to commence judicial review.