Japan is still No.1 in Asia


September 5, 2014

Japan: Efficiency and Sense of Economy is a Way of Life

by Din Merican, Tokyo, Japan

Kamsiah and Din in Tokyo2In my book, despite what has been written about the country over the last 2 decades since the Plaza Accord of 1985 when the Yen was revalued against the United States Dollar, Japan is still No.1.

As a frequent business visitor to this Land of the Rising Sun in the 1980s, and after a considerable lapse of time  before this visit,  I reaffirm this assessment when I arrived with my wife, Dr. Kamsiah yesterday at Narita Airport on Malaysia Airlines Flight MH88.

It was indeed a very good flight where we enjoyed the excellent service provided by a team of very kind and dedicated crew of pilots and stewards and air hostesses. If they were affected by the MH370 and MH17 tragedies, they certainly did not show it.

Japan is an outstanding example of efficiency. That has not changed despite negative reports we read about Japan after the 1985 Plaza Accord. Why? These reports overlook the character of Japanese society and its culture, values, and heritage. The Japanese are hardworking, dedicated, efficient, friendly, and proud people. Their work ethics remain legendary.

The Samurai

We saw Japanese efficiency at Narita. It took us less than 15 minutes to clear immigration and customs and get our bags. After these formalities, we were met by two City Police officers who introduced themselves in good and fluent English, took our particulars and handed us a pamphlet containing contact numbers for emergency and ambulance services. We were then driven to our hotel by well dressed hotel chauffeur who greeted us with the usual bow of welcome. At the hotel, we again saw efficiency in action. The hotel staff attended to us promptly. After checking in at the Grand New Takanawa Prince Hotel, we were driven by a shuttle bus to Shinagawa station. We then took the train to Shinjuku and Ginza for some sightseeing.

tokyoTokyo

The Japanese standard of efficiency is everywhere on display. Be it time efficiency, traffic management and system,  economic use of space , and fuel efficiency; this apparently is ingrained in the Japanese psyche. We are told that this habit is taught to Japanese kids in their schools. Tokyo is a very clean city and environment. Its garbage separation and collection system is second to none, and we feel that both Kuala Lumpur and Petaling Jaya can learn a lot about how to deal with our rubbish and care for the environment

july 4th 2007Get Politics Right and the rest will follow

 

 

 

 

  

“Diplomatic Immunity” is not a License to commit crime


July 2, 2014

Understand “Diplomatic Immunity”: It is not a License to commit crime

http://www.malaysiakini.com

Extending diplomatic immunity to a diplomatic attache accused of sexual assault and burglary sends the signal that such immunity is a license to commit crime. Saying this in a statement yesterday, NGO Lawyers for Liberty’s executive director Eric Paulsen said that extending such immunity jeopardises Malaysia-New Zealand ties.
New Zealans

Further, he said, such “abuse” could also undermine ties with other nations as Malaysia “is not able to guarantee that its diplomats will be able to respect the laws” of the host state. As such, the NGO urged the government to extradite Muhammad Rizalman Ismail, who is defence assistant staff at the Wellington consulate, immediately and not just try him in military court in Malaysia.

Not just a discipline breach

“Lawyers for Liberty is shocked and appalled that the Malaysian government has asserted diplomatic immunity to protect Rizalman from what is obviously a serious case of sexual assault and burglary, acts of which are unconnected with his diplomatic role.

“We remind the Malaysian government that diplomatic immunity is essential for diplomats to work without harassment in a foreign state, but it is not a licence to commit crimes and certainly not to be used in the present case,” he said. He also said that Rizalman (left), should not just be court-martialed as suggested by the Foreign Ministry as he is not just accused of discipline breach.

“(It) is preposterous as this is not a disciplinary issue but serious criminal offences that have been allegedly perpetrated against a woman. Further, the alleged crimes were committed in New Zealand and obviously, the most convenient forum to try the crime would be in New Zealand and it would be absurd and extremely burdensome to get all the witnesses and evidence to be brought to Malaysia,” he said.

 

Tun Dr. Mahathir Thwarts Sultan’s Power Grab


Taipei. Taiwan

June 18, 2014

Mahathir Thwarts Sultan’s Power Grab

Written by Our Correspondent

http://www.asiasentinel.com/politics/mahathir-thwarts-sultan-power-grab/

Sultan of Johore

Malaysia’s aging former Prime Minister Mahathir Mohamad had to act earlier this week to save Prime Minister Najib Tun Razak from an embarrassing legislation that would have given the Sultan of Johor executive powers to run the housing authority of the country’s second biggest state.

Eventually the legislation was amended to remove the threat. But once again it is Najib, in the eyes of political analysts in Kuala Lumpur, who is regarded as having suffered a blow to his political standing because of his failure to act. Former Deputy Prime Minister Musa Hitam, at 80 still a political force in Johor, also joined the fray to stop the legislation.

Although Najib’s position remains secure because there is no threat from anyone either inside or outside the United Malays National Organization, the country’s dominant ethnic political party, he is the subject of widespread criticism. He has come to be viewed as indecisive ever since the 2013 general election, in which the ruling national coalition lost the popular vote for the first time since 1969 although it maintained its majority in parliament,.

TDM--21 March“Thank God for Mahathir,” said a prominent Kuala Lumpur opposition source. “I never thought I’d say that, but thank God for Mahathir.”

The hereditary rulers in nine of Malaysia’s 13 states supposedly merely perform ceremonial functions except in matters related to Islam, where they have powers of intervention. The Johor Sultan, Ismail Idris, was attempting to go far beyond that.

That is largely because during his 22-year period as Malaysia’s Prime Minister, Mahathir, now 88, engaged in a ferocious struggle to break the absolute power of the rulers, who take turns swapping the country’s kingship among them. Even after Mahathir broke their absolute power with legislation, the sultans have continued to get away with physical assaults and large-scale gambling debts in London and other casinos that have had to be paid from state coffers.

In 1993, in a speech before the Dewan Rakyat, or Parliament, the then Prime Minister pushed through legislation that allowed commoners to criticize the sultans including the king without fear of the country’s Sedition Act. However, in recent years, Mahathir’s measure has been largely ignored, including by the former premier himself, as UMNO has played politics to use the sultans to stifle dissent.

Now UMNO got caught in its own contradictions. The Johor Sultan suddenly made a power play in a sweeping bill tabled by his ally, the state chief minister, Mohamed Khaled Nordin, in the Johor legislature that would have given the Sultan control over vast amounts of lucrative state land through the Johor Property and Housing Commission. The measure would have given the sultan the power to appoint board members and investigate the commission‘s books, among other functions.

It was the latest in a series of moves by the Johor monarch, which critics say have been designed to eventually effectively take full power in the state, the country’s second richest and one that is growing richer because of its proximity to Singapore across the narrow Singapore Strait. The vehicle is the huge Iskandar development region, covering the city of Johor Bahru and three adjoining towns. The Iskandar project, encompassing 2,217 hectares of land, is in effect becoming Singapore’s industrial and residential suburb. It is estimated that as much as 40 percent of infrastructure spending for the country under Najib’s Economic Transformation Program is being spent in the state.

Enter the Sultan, who since the project got underway in 2006 has assumed greater and greater control over the region. He has been accused privately of sanctioning kickbacks, money laundering and a variety of backroom deals. He was a college classmate of Chief Minister Khaled, whom he appointed to his job. But in the growing atmosphere of political repression of comments about the sultans, his misdeeds have remained unreported and the power play was largely hidden in shadowy language in Malaysia’s mainstream press, along with his behavioral antics.

Despite Mahathir’s legislation outlawing the use of sedition laws to stifle criticism of the sultans, for instance the late Karpal Singh, the former chief of the opposition Democratic Party, was convicted on appeal of sedition charges in February this year after he merely said in Kuala Lumpur in 2009, during a political squabble over the leadership of the state of Perak, that a decision by the Sultan of Perak could be questioned in court. Karpal was stripped of his legislative seat and fined. He was appealing the decision when he was killed in a car wreck.

That use of sedition against opposition members left Najib and UMNO in a quandary when it came to the Sultan of Johor, who is hardly a Boy Scout. Ibrahim was jailed on allegations that he had beaten people in nightclubs before he became sultan and committed other offenses including shooting a man in a nightclub after an argument during the 1980s. The charge was dismissed because of the then-prince’s immunity. Ibrahim was also involved in two other separate assault cases.

In a 2005 case, a young woman reportedly was assaulted by Ibrahim after he accused her of two-timing him. His late father, Iskandar, who died in 2010 and for whom the Johor project was named, was alleged to have murdered two people but was not charged because of his immunity as a sultan. It was one of those murders that impelled Mahathir to push through laws removing the sultans’ immunity from prosecution.

Thus the ruling coalition and UMNO in particular were presented with a dilemma — how to criticize the actions of a state ruler they themselves had deemed untouchable. Najib, say sources in Kuala Lumpur, simply abandoned the situation, ignoring a letter sent to him by Mahathir demanding he take action. Apparently it fell to Musa and Mahathir to force amendments in the legislation behind the scenes to stop the sultan’s ploy.

Part of Najib’s dilemma stemmed from the fact that UMNO has seen its local political clout diminish. Although it still The Silent Onecontrols 56 of the 74 seats in the State Legislative Assembly, it lost 18 seats to the opposition in the 2013 national election. In that relatively weakened state, political analysts said, opposing the sultan, who remains the figurehead of rural Malays, was considered politically unwise by Najib.

That was when Mahathir stepped in from Kuala Lumpur to criticize the legislation, along with Musa, who told the Straits Times Sunday edition that “If the allegations are true, then it will affect the fundamental principles of constitutional monarchy and parliamentary democracy. One cannot expect the people to keep quiet on the matter.”

Ultimately the bill was modified to remove the sultan’s power to make appointments and vest it in the chief minister, which remains a continuing concern. It was passed on June 9. Mahathir himself remains suspicious, saying Chief Minister Khaled might succumb to the Malay tradition of considering the sultan the head of state.

“This is the Malay custom, if the sultan says something, it must be followed,” the former Prime Minister told Malaysiakini. “I am worried that it would not be the [chief minister] advising the sultan, but the sultan advising him.”

The Power of ‘the Street’


May 11, 2013

NY Times Sunday Review

The Power of ‘the Street’

by Serge Schemann (05  09 14)

http://www.nytimes.com/2014/05/11/opinion/sunday/the-power-of-the-street.html?partner=rss&emc=rss

A-G Gani Patail is not above the Law


April 11, 2014

A-G Gani Patail loses to Rosli Dahlan: NO ONE IS ABOVE THE LAW

by Din Merican

mh370-hishammuddinWilliam Pesek, a prominent Bloomberg columnist, wrote recently that the global outcry over the loss of flight MH370 has highlighted the country’s deepest flaws of incompetent people running the country.

The Fumbling Team of MH370

“The fumbling exposed an elite that’s never really had to face questioning from its people, never mind the rest of the world. The country needs nothing less than a political revolution,” said Pesek. And I agree. Nothing will change until the present political elite is made to pay for their ineptitude, incompetence and crooked ways by Malaysian voters.

At the international level, our political leaders will have to take the blame. At the national level, we are facing a crisis of our public institutions being headed by not just mediocre and incompetent people but also characters who are downright dishonest and who abuse the system with impunity– the rogues in government.

Rosli Dahlan wins against A-G Patail

Vazeer, a former practising lawyer before being made a judge, said he agreed that deliberate abuse of power by those holding a public office was misfeasance in public office.

Vazeer, a former practising lawyer before being made a judge, said he agreed that deliberate abuse of power by those holding a public office was misfeasance in public office.

That brings me to the news reports of this morning that my young friend, Lawyer Rosli Dahlan, has again won another case against A-G Gani Patail. For my readers’ convenience I have reproduced only the MKini report by Hafiz Yatim (below) that provides interesting links on this story that never ceases to inspire me.

Back in Time–To the Eve of Hari Raya (Aidil Fitr), 2007

It’s a sad story of how on the eve of Hari Raya 2007, Lawyer Rosli Dahlan (right) wasR Dahlan brutally arrested in his office in full view of his staff by the ACA (now MACC). He was then charged in a most sensational manner to deceive the public into believing that Rosli had hidden illegitimate assets belonging to the Director of Commercial Crimes, Dato Ramli Yusuff, in another sensational story fanned by the media dubbed as the “The RM 27 million Cop”.

All this was part of a conspiracy to eliminate Dato Ramli from the PDRM as Dato Ramli posed a threat to then IGP Musa Hassan and A-G Gani Patail. Rosli was made a victim because he dared to defend Dato Ramli despite warnings having been sent to him. Since then, Musa‘s former ADC had sworn a Statutory Declaration to expose IGP Musa Hassan’s links with the underworld.

A lot more was also disclosed about A-G Gani Patail’s association with shady corporate figures like the one in the Ho Hup Affair. The Internet was also abuzz with stories about how A-G Gani Patail went to Haj and had his son to share a room with a shady former Police Inspector who was once charged for corruption, Shahidan Shafie, a proxy of former MAS Chairman Tan Sri Tajudin Ramli.

Tajuddin Ramli and the MAS saga was among the many failures of Dr Mahathir’s Bumiputra corporate advancement project which culminated with MH370 disaster. The latest episode could sink MAS without tax-payers bailout forthcoming .

Tajuddin Ramli and the MAS saga was among the many failures of Dr Mahathir’s Bumiputra corporate advancement project which culminated with MH370 disaster. The latest episode could sink MAS without tax-payers bailout forthcoming .

That explains why A-G Gani never charged Tajudin Ramli for the losses of RM 8 billion that MAS suffered despite recommendations by Dato Ramli Yusuff. Dato Mat Zain Ibrahim, former KL OCCI also swore SDs about A-G Gani Patail throwing away the Batu Putih case for pecuniary gains.

Ramli YusuffYet Gani Patail remains as the A-G of Malaysia, leading many to speculate that he has a grip on PM Najib Razak because of Razak Baginda’s acquittal in the murder of the Mongolian beauty, Altantuya Shariibu. In that case, the A-G did not appeal against Razak Baginda’s acquittal.

On the other hand, the A-G has pursued criminal appeals against certain people like Lawyer Rosli Dahlan and Dato Ramli Yusuff (left). In the PKFZ case, A-G Gani Patail charged and appealed against the acquittal of Tun Ling Liong Sik which led to Tun Lingcalling him – “ That Stupid Fella”.

Back to Rosli’s case. Lawyer Rosli, he has fought a long and lonely battle, winning his acquittal and then suing every one of the mainstream media for defaming him – Utusan Malaysia, The Star and the NST, and winning against them one by one very patiently.

On April 15, 2008, Utusan Malaysia published a public apology admitting their wrongdoings and acknowledged that the Utusan Malaysia’s article “was written and published in a sensational manner to generate publicity which exceeded the parameters of ethical journalism surrounding the investigation of YDH Dato’ Pahlawan Haji Ramli Haji Yusuf who at that time held the post of Director of the Commercial Crime Investigation Department of Police DiRaja Malaysia.”

Utusan's Apology

On January 15, 2013, the Star paid damages and admitted to its wrongdoings in a published public apology.

The Star's Apology

On October 18, 2013, the KL High Court found the NST and the MACC guilty of defaming Rosli and ordered them to pay damages of RM 300,000 and costs. This made history as it was the first time that the MACC was sued by a person and the MACC lost and had to pay damages.

Last year Rosli sued A-G Gani Patail, MACC Chief Commissioner Tan Sri Abu Kassim and several other MACC officers for conspiracy, false and malicious investigation, abuse of power, abuse of prosecutorial discretion, malicious prosecution, prosecutorial misconduct and public misfeasance.

Read the MKini report below and you will discover that A-G Gani Patail had engaged Tan Sri Cecil Abraham , a senior private lawyer from Messrs ZulRafique & Partners (an UMNO law firm) to defend him, the A-G Chambers (A-GC) and the MACC.

I find that surprising since I am told that the A-GC has over 800 lawyers, making the A-GC the “largest law firm” in the country. By contrast, I am told that the largest private law firm in the country has a maximum of 140 lawyers.

 Putrajaya needs to review its policies as it can't afford to spend taxpayers' money on the AG's own legal problem.


Putrajaya needs to review its policies as it can’t afford to spend taxpayers’ money on the AG’s own legal problem.

That means the Government of Malaysia spends millions of ringgit to staff the A-GC in order to defend the government. Yet when the Government is sued, A-G Gani Patail engages private lawyers. Does that makes sense to you?

Is A-G Gani Patail admitting that he is not confident of the A-GC, which he heads, to defend him and the government in the face of the law suit by Lawyer Rosli Dahlan? Is A-G Gani Patail admitting that the A-GC is incompetent? Was that why Tan Sri Shafee Abdullah was asked to be an ad hoc DPP to prosecute the appeal against Dato Seri Anwar Ibrahim? Or is there is a commercial logic to that? Is A-G Gani Patail outsourcing legal work to his friends in the private sector to reward them for covering up for his misconduct and incompetence?

Cecil Abraham sits in the MACC’s Operations Review Panel.

Cecil Abraham sits in the MACC’s Operations Review Panel.

I had a chat with Tan Sri Robert Phang who has always been critical of A-G Gani Patail. He told me a more worrisome story. Robert Phang questioned whether Tan Sri Cecil Abraham (right) is a fit to lawyer to defend the A-G because Cecil Abraham sits in the MACC’s Operations Review Panel, which advises on oversights in the MACC. One of the committee’s functions is to ensure that the MACC and other government agencies do not commit abuses. It is like an Ombudsman. If so, how can Cecil Abraham defend A-G Gani Patail and the other MACC officers whom Rosli has accused of fixing him? Is that not a conflict of interest?

Other lawyers tell me that Cecil Abraham is the senior lawyer implicated in the PI Bala SD case over the Altantuya murder. I am stunned by all these revelations. It seems that all the committees and advisory panels in the MACC and other government agencies are to cover up for their wrongdoings rather than to expose and correct them. No wonder our country is headed for doom !

Americk Sidhu, PI Bala's lawyer makes a startling revelation at the Bar AGM that Cecil Abraham confided in him that he prepared the 2nd SD on instructions from Najib.

Americk Sidhu, PI Bala’s lawyer makes a startling revelation at the Bar AGM that Cecil Abraham confided in him that he prepared the 2nd SD on instructions from Najib.

I am told that Rosli’s Statement of Claim against A-G Gani Patail contains very damning revelations about A-G’s misconduct. I am told that with every victory that Rosli gained against A-G Gani Patail, more and more civil servants and people are coming up to him to offer assistance and being more willing to be witnesses in his cases. This was unlike before when many were afraid to be associated with him.

Is that why AG Gani Patail does not want to go to trial and employ all kinds of delaying tactics in Rosli’s suit against him. Is that why A-G Gani Patail engaged Tan Sri Cecil Abraham to strike out Rosli’s suit? Otherwise, why is A-G Gani Patail so afraid to go to trial in Rosli’s case?

But now that Tan Sri Cecil has lost this striking out application and the A-G is ordered to pay cost to Rosli, who is going to bear this cost? Should taxpayer’s money be used to pay for the misconduct of these rogues in government? If we taxpayers have to bear this cost, then A-G Gani Patail and the likes of him will never be repentant. There will never be accountability!

In my view, A-G Gani Patail must bear the full costs of his misconduct. He must be held accountable and he must pay the legal fees charged by his friend Tan Sri Cecil Abraham. I am also of the view that the MACC should sack Cecil Abraham from being on its Advisory Panel. Cecil Abraham cannot sit there to pretend that he is acting as a check and balance against the MACC’s misconducts whereas he is also covering up for the MACC when the MACC is sued by Rosli, and getting well paid by the Government using tax payer’s money!

Conflict of Interest

The conflict of interest is so clear and it is appalling that a senior titled lawyer like Tan Sri Cecil Abraham cannot see that. I also feel that the Bar Council should not stand idle arms akimbo with this revelation. The Bar Council should subject Cecil Abraham to disciplinary proceedings for breaching such common sense rule on conflict of interests. Cecil has dishonored the Bar and the Council must act against him!

Well Done, JC Wazeer Alam Mydin 

In that regard, I must congratulate Judicial Commissioner Wazeer Alam Mydin for having a fair sense justice in not allowing A-G Gani Patail to strike out Rosli ‘s claim. A judicial Commissioner is basically a probationary judge. For a probationary Judge to do this means JC Wazeer is indeed a brave man who would not tolerate public authorities who commit abuses and then claim immunity. It is indeed a brave probationary judge to stand up to the A-G and tell it to the A-G’s face that the A-G is not above the law.

The winds of change is blowing and judges like JC Wazeer Alam will be a credit to the judiciary. JC Wazeer Alam is indeed a brave man to make this iconic statement:

“The claim by AG of his absolute public and prosecutorial immunity is an anathema to modern democratic society.”

======================================================

April 11, 2014

A-G not immune to legal action, rules Judge

by Hafiz Yatim@www.malaysiakini.com

The Attorney-General is not immune to legal action, the High Court in Kuala Lumpur ruled today.

Judicial Commissioner Vazeer Alam Mydin Meera said this in dismissing Attorney-general Abdul Gani Patail’s application to strike out the suits by former Commercial Crime Investigation Department director Ramli Yusuff and his lawyer Rosli Dahlan.

Public authorities who abused their powers have been "insulated" from prosecution for "far too long" by using the Public Authorities Protection Act.

Public authorities who abused their powers have been “insulated” from accountability  for “far too long” by using the Public Authorities Protection Act.

“I am afraid that the notion of absolute immunity for a public servant, even when mala fide or abuse of power in the exercise of their prosecutorial power is alleged in the pleadings, is anathema to modern day notions of accountability.

“I agree that deliberate abuse of power by a person holding a public office is tortious and is referred to as misfeasance in public office.

“Such a tortious act can arise when an officer actuated by malice, for example, by personal spite or a desire to injure for improper reasons, abuses his power,” Vazeer Alam said.

“This is keeping with developments in modern jurisprudence that absolute immunity for public servants has no place in a progressive democratic society,” the judge added. The A-G and two other officers from the A-G’s Chambers were named in the respective suits filed by Ramli Yusuff and Rosli Dahlan.

They had sought to strike out the suits on the grounds that they should be immune to such action in carrying out their prosecution powers. Ramli had filed a RM128.5 million suit against A-G Gani, former IGP Musa Hassan and several Malaysian Anti-Corruption Commission officers.

Rosli had filed a separate suit amounting to RM48 million against the same parties.The two are suing them for abuse of power, malfeasance in the performance of public duty, malicious prosecution and prosecutorial misconduct, among others.

Suits not filed out of time

Judicial Commissioner Vazeer Alam also ruled that the two suits for malicious prosecution were not filed out of time as this cause of action accrued upon the determination of the final appeal. He said that the court could not consider the period to be when Ramli or Rosli  were acquitted, as there were subsequent appeals against the acquittals made after this.

“As with Ramli’s case, the appeals lodged by the public prosecutor were dismissed in June and in November 2011. Therefore the filing of the action on Nov 1 last year is well within the time stipulated in Section 2 of the Public Authority Protection Act,” the  ruled,

Vazeer Alam also allowed the two to name the MACC in their legal action, since the MACC took over from the Anti-Corruption Agency.

Ramli had sued the defendants for their claim that he was the policeman in the Copgate affair and that he had RM27 million in assets.

Subsequently, Ramli was charged with the non-disclosure of some of his assets and the case against him was thrown out. Ramli’s lawyer friend Rosli was also hauled up as a result of this.

Ramli, who was a former state Police Chief for Pahang and Sabah, said in his statement of claim that his relationship with Gani soured in 2006.

This was after he met then Prime Minister Abdullah Ahmad Badawi and recommended that former Malaysia Airlines chairperson Tajudin Ramli be prosecuted for the severe losses suffered by the company.

“But the A-G decided not to prosecute Tajudin. I even told the PM then that if the AG was reluctant to prosecute Tajudin, the CCID would have the necessary resources to conduct the prosecution.

“This earned me Gani’s permanent displeasure…” Ramli said in his statement of claim.

‘A brave decision’

After today’s court session, Ramli commended the judge for his brave decision. “I am not doing this for Ramli Yusuff but for the Police Force, some of whom have been victimised as a result of this. And I am also doing this for the serving government officers who have also been victimised.

“I am also seeking closure to an event that has affected my possible career advancement,” he said.

The RM27 million investigations had hindered his promotion to be the Inspector-General of Police, he added. This post was subsequently handed over to Musa Hassan.

Rosli, on commending today’s High Court decision, said abuses by the public authority have for too long been insulated by invoking the Public Authority Protection Act.

“Today, a brave judge has declared that absolute prosecutorial immunity is  anathema to the modern concept of democracy. This is to remind the public authorities that no one is above the law,” Rosli said.

Several Police Officers under Ramli’s charge have also been prosecuted as a result of the Copgate affair and all of them have acquitted and have been reinstated to their posts during former IGP Ismail Omar’s tenure.

Ramli was represented by Harvinderjit Singh, while Chethan Jethwani and Darvindeer Kaur appeared for Rosli. Senior lawyer Tan Sri Cecil Abraham, Rishwant Singh and Senior federal counsel Dato Amarjeet Singh represented the defendants.

Vazeer fixed June 18 for case management to possibly fix trial dates for the hearing.

Fund Scandal Looms in Malaysia


February 27, 2014

Fund Scandal Looms in Malaysia

Mysterious sovereign wealth fund may be billions in debt

NAJIB_RAZAK_091213_TMINAJJUA_05_540_360_100Political insiders in Malaysia say Prime Minister Najib Tun Razak could be facing a fresh political crisis due to the murky dealings of a sovereign fund established five years ago to drive investment in strategic domestic industries.

A widening circle of critics, fed in part by exhaustive reporting on independent news sites such as Malaysiakini, say the fund may have run up as much as RM40 billion (US$12.18 billion) in debt and has few assets to show for it beyond what are described as overpriced acquisitions of independent power producers in Malaysia.

On February 18, Opposition MP Tony Pua of the Democratic Action Party announced on the floor of Parliament that the fund, 1Malaysia Development Bhd, known as 1MDB, had yet to file accounts for the financial year ended March 2013 and that KPMG, the independent auditor, had suddenly resigned. Deloitte Malaysia has since taken over the accounts.

In 2012, 1MDB made a US$1.75 billion private bond placement, one of the biggest private US dollar bond placements on record from Asia, through Goldman Sachs, to acquire a portfolio of power assets. Other bond placements also have been made. According to US laws, failure to file financial accounts is a violation of the law, which should be raising concerns among the bondholders.

 ‘Bold and Daring’
A United Malays National Organization operative told Asia Sentinel a major scandal is lurking in the fund, which is wholly owned by the country’s Ministry of Finance, although no clear evidence has emerged of the exact nature of the scandal.  

Former Prime Minister Mahathir Mohamad and former Finance Minister Daim Zainuddin, both of whom have soured on Najib, are said to be questioning the operation of the fund. There has been a rising tide of gossip about the fund’s political connections, particularly to Najib’s wife, Rosmah Mansor, and a close friend, Low Taek Jho, who was active in founding the fund. 

Jho Low, as he is known, has become a New York social figure, seen out with Paris Hilton and pouring Cristal champagne for a succession of showgirls.  He and Rosmah’s son by her first marriage, Riza Aziz, produced The Wolf of Wall Street, a major box office success that has been nominated for a Best Picture Oscar. Ironically, the film can’t be shown in Malaysia because of its excess profanity.

Low reportedly was behind Wynton Group, which showed an interest in bidding for the famed Claridge’s, Berkeley and Connaught hotels in London. According to a Malaysian website, in a court document filed in Ireland, Low made the approach in 2010.  According to the court filing, Low was said to have had the backing of an unnamed Malaysian “sovereign wealth fund,” which was not named. Low has acknowledged having friends in Khazanah Nasional Bhd, another Malaysian sovereign wealth fund. The 1MDB fund wasn’t mentioned

Little is known of 1MDB’s operations. As Asia Sentinel reported at the time, it raised hackles when it started in April 2009 as a fund arranged by Jho Low and started by the Terengganu state government, which borrowed RM10 billion (US$2.87 billion at 2009 rates). Critics questioned why an oil-rich state with revenues of RM5-7 billion a year would have to borrow money to start a sovereign fund rather than using windfall revenues from oil and other commodity bonanzas.

The Terengganu fund morphed into 1MBD under the Ministry of Finance in September 2009 to “focus on strategic development projects in the areas of energy, real estate, tourism and agribusiness.” The fund’s website quotes Najib saying its mission is to “be bold and daring… to break new ground and do things differently.”

1MDB soon acquired a strategic partner in an obscure Saudi firm, PetroSaudi International, headed by Tarek Essam Ahmad Obaid, a member of the vast Saudi royal family. Reports indicated that PetroSaudi had signed a memorandum of understanding with Ghana National Petroleum Corp. although the MOU has apparently not resulted in a major project.  

According to a statement by Azmi Khalid, then chairman of the Parliament’s Public Accounts Committee, 1MDB loaned PetroSaudi about US$1billion, leading to additional questions over why a government fund set up to explore investment in Malaysia was loaning money to a joint venture in Africa. PetroSaudi, despite rumored ties to the Saudi royalty, was unable to come up with its own cash in the joint venture but got 1MDB to accept a potential oil site in Turkmenistan. Subsequently, the loans to PetroSaudi climbed to US$1.7 billion.

Debt and not much else
An exhaustive probe of the sovereign fund by writers Ho Kay Tat and Afiq Isa for the Malaysian publication The Edge, found that about all 1MDB has to show so far “is a multi-billion ringgit debt portfolio, the bulk of which was used to buy several independent power producers at hefty price tags.” 

Its main asset is a 48-hectare chunk of land passed to the fund by the government when the Malaysian Air Force closed its base at Sungai Besi, near downtown Kuala Lumpur’s Golden Triangle. It is a near-priceless plot that 1MBD is to develop as a financial center called the Tun Razak Exchange, named for Najib’s late father. That work hasn’t started yet.

Through a series of complicated financial engineering moves in 2012, the loan to PetroSaudi was prematurely terminated and redeemed, according to Tony Pua’s presentation on the floor of Parliament.

“However,” Pua said, “the repayment of US$2.32 billion (RM7.93b) was made in a perplexing manner in a “segregated investment portfolio” based in the Cayman Islands. To date no one has been able to verify with any certainty who the investment portfolio manager is, the fund’s performance or for that matter, if the money actually exists.”

The “investment” in the Cayman Islands, Pua said, “raises highly suspicious questions as 1MDB is desperately trying to raise funds through new bond issuance in Malaysia to fund its aggressive acquisitions of independent power producers as well as its mega-projects in Bandar Malaysia and Tun Razak Exchange. In fact, 1MDB is already laden with an estimated more than RM40 billion in debt, and hence such investments is a luxury that 1MDB does not have.”

KPMG, in 1MDB’s first financial statement in 2010, raised an “emphasis of matter” over a US$1 billion investment in the PetroSaudi joint venture, which was subsequently converted into a US$1.2 billion (RM3.95b) loan within a period of less than six months. The “emphasis of matter” was removed in subsequent financial accounts as the joint venture was servicing the loan with interest payments, it was also highlighted that 1MDB extended an additional US$700 million (RM2.3b) in loans to the JV, despite receiving less than US$200 million in interest between 2011 and 2012.

To date,  no one has been able to verify with any certainty who the investment portfolio manager is, the fund’s performance or for that matter, if the money actually exists, Pua said.