Does ‘lapse of governance’ cover US$3.51 billion?

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By Tony Pua

Yesterday, Prime Minister Najib Razak told the Malaysian and international investment community that there were only “lapses in governance” in 1MDB and he has “ordered investigations into the company at a scale unprecedented in our nation’s history”.

If it were indeed true that investigations were at an “unprecedented” scale, then the investigators must be the most incompetent ever seen in Malaysian history.

This is because to date, the key questions surrounding the various dodgy investments by 1MDB and the billions of ringgit misappropriated, often to entities owned by businessman Low Taek Jho (Jho Low) have never been explained.

In one of the few questions with regards to 1MDB which was not rejected by the Parliament Speaker yesterday, I had asked Najib Razak, who is also the finance minister, why did we assume the liabilities of IPIC’s guarantee for 1MDB’s US$3.5 billion worth of bonds when 1MDB claimed that we had already paid IPIC or its subsidiaries the sum of US$3.51 billion.

1MDB, via its president and CEO, Arul Kanda, testified to both the Auditor-General and the Public Accounts Committee that 1MDB had already paid US$1.367 billion in collateral deposits in 2012, US$993 million in options termination compensation in 2014 and an additional US$1.15 billion in “top-up security deposit” also in 2014 to the IPIC group.

In the finance minister’s reply, Najib stated that 1MDB “is responsible for all future interest payments and the repayment of the principal for the 2 bonds” while the Ministry of Finance Incorporated (MoF Inc) has provided IPIC with the relevant “undertaking” and “indemnity”.

The problem is, despite the boast of “investigations… at a scale unprecedented in our nation’s history”, Malaysians are no nearer to finding out what happened to the US$3.51 billion we have already paid.

And it is very apparent that the prime minister is also hiding this information via a convenient “lapse of governance” because he failed to answer this question in his parliamentary reply.

It is as if the US$3.51 billion paid to the IPIC group previously was just a minor detail, or an insignificant “lapse in governance” which didn’t require any justification or concern on the part of the government.

Hence, Najib is only showing the thickness of his skin by trivialising the unprecedented scale of the RM50 billion 1MDB scandal and dismissing opposition protests as blowing the issue “out of proportion”.

Instead, the continued secrecy of the Auditor-General’s Report on 1MDB and the refusal to entertain 1MDB questions in Parliament seriously only leads the public to believe that the US$3.51 billion above, is just part of more billions of ringgit that have been misappropriated, or worse, stolen at “a scale unprecedented”.

Tony Pua is Petaling Jaya Utara MP and DAP national publicity secretary.

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