Malaysia after Hudud: A Nation Divided

March 29, 2015

Malaysia after Hudud: A Nation Divided

By Zurairi AR and Boo Su-Lyn

No Hudud in MalaysiaTHIS?

Hudud has for the past two decades largely been treated as a mere fringe topic among Malaysians, a political hot potato tossed back and forth between local parties as they canvassed for Muslim votes during elections.

But last week, when the Kelantan legislative assembly passed amendments to its Shariah Criminal Code II enactment — dubbed the hudud Bill — the controversial Islamic penal code quickly became a legitimate public concern.

Now, if PAS, the Islamist party that governs Kelantan, next succeeds at the federal level in getting more legislative amendments approved, hudud, an Islamic punishment system under Shariah law, will be implemented for the first time in a Malaysian state.

Although the law would only be confined to Kelantan, it must be noted that PAS’s manoeuvre in Kelantan has already roused the ambitions of other Islamist groups and scholars who wish to see hudud sweep the country. All eyes are also on Terengganu, which had also passed a similar but still ungazetted enactment with hudud elements in 2002.

The ball is now in Parliament’s court, but analysts and observers are already warning that should hudud get implemented in other states, the Malaysia we know today will head towards an irreparable divide.

A legal system divided

Malaysia has always practised a dual-track legal system, although for the Muslims, legal disputes on family matters like marriage, divorce and inheritance, and the precepts of Islam, are dealt with under the Shariah law.

The implementation of hudud, however, will see the Shariah courts encroaching on offences already covered in the civil justice system, specifically the Penal Code. These include crimes like sariqah (theft) and hirabah (robbery). Hudud’s companion qisas, meanwhile will legislate the offence of murder, which is also already covered by civil law.

According to amendments in Kelantan’s hudud Bill, however, once enforced, hudud will only apply to Muslims. For example, a Muslim guilty of theft in Kelantan can be punished by amputation of his limbs, under Section 7 of the state’s hudud law.

But in the Penal Code, the same crime committed by a non-Muslim prescribes a maximum seven-year jail term or fine or both, according to Section 379 of the legislation.

The prospect of subjecting criminals to two different punishments for the same crime by virtue of their religious backgrounds, however, could prove complicated in a diverse nation like Malaysia, analysts said.

Hudud2OR THIS?

“How do you enforce this in a plural society? Of course it would lead to injustice between Muslims and non-Muslims, especially if the crime involves perpetrators of different religions,” political analyst Nik Abdul Aziz Nik Hassan said in a recent phone interview.

“I think this contradicts the principles of Islam, where there exists variations and injustice in the punishment for the same crime.” At the crux of the argument is the Federal Constitution, the supreme law of the country that is the bedrock of Malaysia’s foundation.

If hudud is to be implemented, it would mean that the Federal Constitution will have to be amended to legislate against crimes already under the Penal Code, said Nizam Bashir, who is both a constitutional and Shariah lawyer.

“What seems to be missing from the conversation at this point of time is what the framers of the Constitution has envisaged as the appropriate balance of powers in a federal system of government like Malaysia. Simply put, we were always meant to have a strong central government,” Nizam told Malay Mail Online.

“Having said that, this does not mean that states have no power or the monarchs’ role are trivialised in some way in the Constitution. It is far from that.

“But it is very clear that the central government was always meant to take centre stage on matters like crime, and one can see why as it would promote public order,” the lawyer added.

The same sentiment was expressed by Malaysian Bar President Steven Thiru, who in a statement on March 20, said implementing hudud laws would fundamentally alter Malaysia’s secular Federal Constitution in ways never intended.

“If hudud were brought into the criminal justice system, it would result in the importation of Islamic penal law into a secular system. This would result in a rewriting of the Federal Constitution,” Steven warned.

Lawyers have also claimed that the implementation of hudud in Kelantan will lead to more constitutional challenges being filed in court against the Islamic penal code.Constitutional lawyer New Sin Yew pointed out that the civil courts were forced to intervene in previous cases of Shariah courts overstepping their jurisdiction, such as M. Indira Gandhi’s child custody dispute with her ex-husband who is a Muslim convert.

“Certain aspects of the state enactment like sariqah or hirabah will be challenged in the civil courts because only the civil courts have the power to decide on constitutional issues,” New told Malay Mail Online, referring to the hudud Bill.

“And certain punishments like the death penalty and amputation will be challenged for violating federal law,” he added, noting that the Shariah Courts (Criminal Jurisdiction) Act 1965 limits the punishments Islamic courts can impose to three years’ jail, RM5,000 fines or six strokes of whipping.

These challenges are bound to widen the chasm between the two legal systems, especially with minister in charge of religious affairs Datuk Seri Jamil Khir Baharom alleging last year of a “new wave” of assault on Islam here, and accusing rights groups of colluding with enemies of Islam to put its religious institutions on trial in a secular court.

A society divided

The discrimination in punishment among Muslims and non-Muslims will also lead to bigger problems in society as Malaysians would be treated differently in the eyes of the law, Nik Abdul Aziz suggested.

Already, clear divisions have appeared between those in support of Kelantan’s hudud and those who do not, as demonstrated in the recent case of BFM presenter Aisyah Tajuddin.

The young Muslim journalist earned heavy criticism over a satirical video produced by the popular business radio station where she was seen criticising the PAS government’s bid to introduce the law in Kelantan.

“This phenomenon will bring about clashes, discontent, and other problems … When the public is not being managed fairly, it will bring towards a discriminatory pattern,” warned the analyst, who is also a retired former head of Dakwah Studies Department in Universiti Kebangsaan Malaysia.

“Islam emphasises fairness. Under the roof of fairness, only then can you guarantee economic and social stability.”

RATNA_OSMANRatna Osman and Zainah Anwar

Meanwhile, the dismissal of women’s role in hudud also has women rights group Sister in Islam (SIS) worried over the treatment of women in the future, especially Muslim women. SIS’s Executive Director Ratna Osman pointed to Section 41 of Kelantan’s hudud Bill, which specifies that only an adolescent and fair male Muslim can stand as a witness in the cases of zina (illicit sex) and liwat (sodomy).

“This disqualified non-Muslims overall and Muslim women, and this contradicts with equality that is promised under Article 8 of the Constitution, that guarantees equality for all regardless of race and gender,” Ratna told Malay Mail Online.

“The fact that women are disqualified as witnesses in the code, is against the practise of Islamic laws on evidence,” she added, citing several hadith—collections of Prophet Muhammad’s sayings and deeds—where women’s testimonies were accepted in criminal cases.

She also took issue with the provisions in Kelantan’s bill governing qazaf (false accusation of zina), which puts the burden of proof on women in cases of rape, and the li’an provision, which allows a husband to accuse his wife of adultery under a sacred oath.

“You will find because of this gender inequality, a lot of cases, in Iran particularly, where husbands are always using li’an as a means to put their wives in jail. It is an easy way out of marriage,” Ratna claimed.

She also pointed to how in other countries like Pakistan, it is always the women who are convicted of zina while their male partners escape prosecution.Apart from that, Ratna also noted the difficulty in criticising the implementation of hudud after Kelantan passed its hudud Bill.

The space of discourse, even among Muslims, is rapidly shrinking with the authorities now warning laymen against discussing hudud and religion in general, as the voice of discontent continues to grow unfettered online.

Against their critics, PAS has so far resorted to labels from “immorals” and “liars”, which Kelantan Mentri Besar Datuk Ahmad Yaakob uttered when tabling the bill, to “parrots” and “unforgivable ignorants” in PAS president Datuk Seri Abdul Hadi Awang’s open letter a week after.

A country divided

In its video, BFM and Aisyah had asked how exactly hudud would fill the rice bowls of Kelantan folks, especially as the state remains one of the poorest in the country. The question has still remained unanswered, but critics told Malay Mail Online that the trickle down effect of hudud’s implementation in plural Malaysia will inevitably impact even bread and butter issues.

“Why must we rush in hudud, when the priority should be on social justice, eradicating poverty, access to health services, urban cleanliness? There are a lot of things in Islam we can implement,” Nik Abdul Aziz suggested.

“This hudud punishments will lead to bigger implications. If there is a huge case of theft, wouldn’t you have one race with fewer hands than the others? That is why we have to think this out thoroughly.”

There is already global fear that Malaysia risks losing its identity as a model of religious moderation and multiracialism if hudud goes ahead, as expressed by an influential group of retired Malay senior civil servants dubbed G25 on March 25.

Prime Minister Datuk Seri Najib Razak invariably touts Malaysia’s reputation to the international community and investors as a so-called moderate Muslim country, especially in his address to the United Nations as recent as September last year. But this image has continued to take a beating with recent actions taken by religious authorities, especially in the case of the use of the word “Allah” by non-Muslims.

Having hudud nationwide might be the nail on the coffin for his campaign, according to some. “If hudud were ever to see the light of day in Malaysia we can be sure that there will be a massive outflow of investment, wealth and people from Malaysia,” tycoon and philanthropist Koon Yew Yin wrote in his blog on March 22.

“It is not only the locals who will leave. The international community—including foreign investors—has been more loud and vociferous in expressing concern about the growing Islamisation in the country.”

“Adoption by Parliament — even if a two-thirds majority is not obtained — will be the beginning of the end for moderate and inclusive Islam in the country. Is the Middle East model of fundamentalist Islam which has brought destruction and disaster the model that Malaysian Muslims want to follow? I do not think so,” he added.

On March 19, the Kelantan state assembly approved the Shariah Criminal Code (II) (1993) 2015 Enactment with 31 votes from PAS lawmakers supported by 12 from UMNO.

PAS now plans to put forward two private members’ bills in Parliament to enable Kelantan to enforce hudud ― one will seek approval for the state to legislate punishment for crimes under the Penal Code.

The other seeks to amend the Shariah Courts (Criminal) Jurisdiction Act 1965 to enable Islamic courts to mete out punishments like the death penalty for apostasy and amputation of limbs for theft. PAS has said it only needs a simple majority in Parliament, or 112 MPs in the Dewan Rakyat, to amend the Shariah Courts (Criminal) Jurisdiction Act.

Musa Hitam Urges UMNO to make a stand on Hudud

March 22, 2015

Tun Musa Hitam urges UMNO to make a stand on Hudud

Musa HitamUMNO should make a stand now on PAS’s hudud and not pretend to be surprised with the Islamist party’s push for the implementation of the Islamic criminal law in Kelantan, says Tun Musa Hitam.

The former Deputy Prime Minister said hudud is not suitable for a country like Malaysia, expressing his disappointment over UMNO’s slow response on the issue.

“I am disappointed that UMNO appeared to be shocked (by PAS’s move) and until now have yet to decide on its stance. I have been worried about this for some time,” he said in a statement from Cordoba, Spain.

“UMNO must take a firm stance. This national issue has a very long implication to the country, both domestically and internationally,”

He said as UMNO could not afford to be seen as trying to outdo PAS on this issue.”Don’t try to be more PAS than PAS themselves. UMNO should not be trying to out-PAS PAS!”, he said.

With PAS’s partners, DAP and PKR deciding not to support PAS’s hudud bill should it be tabled in Parliament, the onus is now on UMNO and Barisan Nasional to clarify whether it supported the bill.

Prime Minister Datuk Seri Najib Tun Razak is expected to make an announcement on BN’s stand on PAS’s hudud soon. Several BN component parties had given their views during the recent meeting and it was up to the Prime Minister to disclose it.

Musa, who is also the former UMNO Deputy President, said when it comes to hudud, the people should not be surprised with PAS’s hudud bill as the party has been championing the issue consistently for a long time.

“And to the opposition parties in Pakatan Rakyat, do not pretend you are not aware of it too,” he said. At the same time, Musa reiterated his stance that hudud is not suitable for a country like Malaysia.

“As a former UMNO leader, I strongly believe in my heart that since its establishment until today, UMNO’s stance too has been that hudud is not suitable for a multi-religious, multi-racial country like Malaysia,”

Musa said that if he was wrong about it, UMNO should make a decision on its stance immediately and not brush off the matter. “The nation will not the only one that is going to pay for the consequences, UMNO too will feel its bad effect, more so that it has served the country for so long, Do not let this destroy UMNO from within… don’t self destruct.” he said.

PAS Pesident Datuk Seri Abdul Hadi Awang is seeking to table a private members’ bill in Parliament during the current sitting ending April 9 to enable Kelantan to implement amendments to the state’s hudud laws which have drawn outrage from his own PR allies.

The conservative Islamist leader sent a notice to Parliament on March 18, after the Kelantan state assembly unanimously approved the Shariah Criminal Code 11 1993 (Amendment 2015), or hudud bill.

Hadi’s notice, which was confirmed by a senior party leader who said it was to amend Act 355 (Shariah Courts) which limits the powers of the court and is an impediment to implementing the hudud law.

Act 355 or the Shariah Courts Act (Criminal Jurisdiction) 1965 limits the shariah courts to a maximum penalty of RM3,000 in fine, five years’ jail and six strokes of the rotan.

An amendment is required in this law to enable the Kelantan hudud amendments to take effect. However, PAS allies PKR and DAP say hudud laws are not part of Pakatan’s common stand.

PART III: PAS’s folly – awareness and containment

March 20, 2015

The Art of the Matter–Art Harun

PART III: PAS’s folly – awareness and containment

In the introduction of the Kelantan hudud bill its architect declared that those who question whether the legislation would bring in equal justice are “liars and immoral”.

This unbecoming language is what one expects of a fanatic dictator, rather than a genuine democratic leader. It speaks to the decay in the political fabric of Malaysia that is coming from leaders, who have lost the plot in having a national consciousness and the broader decline taking place in democratic governance.–Bridget Welsh

by Bridget

COMMENT: In the introduction of the Kelantan hudud bill its architect declared that those who question whether the legislation would bring in equal justice are “liars and immoral”.

This unbecoming language is what one expects of a fanatic dictator, rather than a genuine democratic leader. It speaks to the decay in the political fabric of Malaysia that is coming from leaders, who have lost the plot in having a national consciousness and the broader decline taking place in democratic governance. Given the passage of the Kelantan hudud bill, what are the likely political implications that will evolve from this measure?

Some political parties will begin the politics of containment, while others will fan division and will continue to use hudud for political gains. As of now, it is important to remember that no hudud measure will take effect. They are all measures on paper.

With respect to those who favour these measures, on many levels hudud does not holistically reflect the ideas of justice embodied in Islam or any faith for that matter and brings to light serious questions about fairness and administration of the rule of law for all of Malaysia’s citizens.

The stoning, chopping and whipping urged in the enactments are now threats over the public without adequate protections; they make up the politics of fear that has been deeply engrained in the Malaysian political landscape.

No implementation does not mean that there measures are not unimportant. Quite the contrary. The people of Kelantan in particular will be hurt economically by the bill, as its leaders across the political divide failed them in thinking holistically about their development.

Real questions can be asked about priorities and timing, namely whether Kelantan in the wake of the floods should be introducing these measures. Questions about fairness also can be asked about who will be potentially affected by these measures, those who engaged in corruption that contributed to the flooding or ordinary citizens.

These are beyond the issues of minority rights, religious freedom and the rights and protections of the constitution that emotionally divide the country in views.

There will be other important political tests ahead as well. Unlike in the two previous pieces, this piece looking at the broader political consequences of the passage of the bill yesterday. The fluidity of Malaysian politics will create opportunities ahead. The hudud issue will likely only remain a weapon of division if national leaders continue to wield it as one.

Sharing blame – a missing ‘vote of consciousness’

In opting for a touted ‘vote of conscience’ for UMNO members in Kelantan, the Najib Abdul Razak government did not lead. In fact, the Najib administration effectively took the stance of allowing the reintroduction of Kelantan hudud law to move forward without opposition.

This was driven by Najib’s weakness, not strength. It will feed extremist religious divisions and make the task of governing Malaysia’s multi-ethnic mosaic more difficult. Najib’s inaction speaks to his failing leadership as Prime Minister and as the leader of UMNO.

It is sadly not the first time when a divisive issue emerged and the PM went missing. Najib may not be able to survive in office until GE-14 and his inaction on the hudud law will only make his struggle for survival in office harder.

Najib’s weak leadership over hudud does in fact have damaging consequences beyond himself. By most measures, Malaysia’s position in the region economically and politically has taken a serious beating in the last year, from airline disasters to the recent poor performance in the stock market caused by the shocking 1Malaysia Development Berhad (1MDB) scandal.

The Kelantan hudud bill will add to these negative perceptions, and hurt the country by discouraging investment and reinforcing the view that the country does not effectively offer protections in the rule of law.

To date, every country or region that introduced hudud – all in political efforts to shore up political legitimacy – has suffered an economic and political backlash. Malaysia does not have the resources of a Saudi Arabia and Brunei to weather yet another storm as effectively.

For Najib, there will be two tests ahead for the hudud bill. The first will be whether the UMNO leadership will move ahead with implementing hudud legislation at the national level. PAS with less than 10 percent of the Parliament do not have the numbers to go ahead. UMNO will be the national driver.

UMNO’s hudud partnership with PAS is driven by the goal of destroying the opposition and PAS in particular. Of late, the actions of the Najib government have repeatedly shown an apparent willingness to carry out actions that damage the country to hold onto power.

A national constitutional amendment allowing hudud is supposedly currently not on the cards, despite PAS ulama grandstanding, but given the climate of crisis and weakness that surrounds both Malay parties and the apparent void of national statesmanship leadership of Najib’s government, not to be ruled out.

The second test is whether Najib will direct its members to follow a ‘vote of consciousness’ rather than one of ‘vote of conscience’. This is a vote that at its core gives all Malaysians confidence in their place in the country and faith in their constitution. It is not one that adopts the practice of the ‘politics of tyranny or the majority and punishment’ carried out in the supposed name of democracy by the conservative PAS ulama.

Whether Najib will be conscious enough to provide wise national leadership in his politically beleaguered state is unclear. One should not underestimate the betrayal, fear and anger that many Malaysians across faiths feel about the passage of this bill that divides the country.

High costs of UMNO primacy and insecurity

The political effects of unanimous support for the Kelantan hudud bill goes beyond UMNO. It was not just Pakatan that was betrayed by its coalition partners, the same happened to the parties within the BN. UMNO has been adopting a primacy for some time, which has deepened post-GE13.

Gerakan, MIC, MCA and other component parties in East Malaysia will all have to come to terms with this act of UMNO and conservative PAS ulama political partnership. They have to come to terms with the fact that they are also allied with a party that supported hudud.

The Kelantan hudud bill will have ripple effects from the cabinet to the Sarawak elections. The pressures inside the BN component parties is there, and they face the same problem as Pakatan partners do over the hudud issue. The glue that keeps Barisan together is power and money, but there has been a similar sense of betrayal at play.

As discussion of the bill evolves, expect pressure within the BN to rise, with Najib becoming the target of these frustrations. He failed to protect the component parties within the BN. A key test ahead will be how the component parties manage in the shadow of UMNO dominance.

Where that pressure will be most felt will be is in East Malaysia. UMNO will now have to face the music in Sabah, and the vote yesterday will assure that in the short-term UMNO is not entering Sarawak. But, it is hard for East Malaysians to distance themselves from the action of their fellow party members in Kelantan, as they are of the same party.

Their  politics of containment have already begun in East Malaysia and they are coming on less reception ground. Since before 2013 there has been a powerful wave of federalism taking root in East Malaysia and this will likely deepen.

Another key test ahead will be the how UMNO can convince its East Malaysian partners to work with them, when this UMNO ‘vote of conscience’ showed a lack of consciousness of genuine national leadership of all of Malaysia’s citizens.

Pakatan separation inevitable, not irrevocable

The main immediate focus however is understandably the opposition, the coalition and individual parties. It was PAS conservative ulama intention to break up Pakatan, but they and their hudud partnership with UMNO is not exclusively responsible for the opposition coalition’s strains.

As I have written elsewhere, the causes of Pakatan’s problems cannot be boiled down exclusively to hudud or to PAS, there must be some shared responsibility. The Kajang move, differences in style and the reality of catering to different constituencies have made for a problematic marriage.

The Kelantan hudud bill will now force the opposition partners to come to terms with the issues that have divided them. This is never easy. Addressing Kelantan hudud will be the Pakatan’s greatest test.

On all sides questions are being asked. How do you work with a partner you no longer trust, a partner who you see as selfish, a partner who is unable to fulfill responsibilities and a partner who thinks and claims to represent a core group of views that are so different from your own? Most would say you don’t. Others would say you have to try.

As with every problematic relationship, there is a need for distance and reflection. Statesman leadership requires that a difficult decision be carefully considered. How Pakatan will solve this problem will reveal how it will govern, and unlike UMNO it does not have the same resources and bounty of position to woo support and keep the coalition together.

The strategic response to the hudud issue divides all the Pakatan parties. The Kelantan PKR representative’s vote and Selangor Menteri Besar Azmin’s Ali’s own alliance with PAS ulama point to some of these ambiguities.

Pakatan will face even more public pressure than the BN component partners. The decision will have spillovers for governance in Penang and Selangor. While both of these governments can survive without PAS, there will be political implications for exclusion.

Pakatan partners will likely need to enter a long cooling off period for assessment and review. Urgings for freezes have already begun. This distance will allow the path ahead to emerge.

After the PAS election this June, it will be clearer whether the PAS members will vote for a leadership that has opted for personal power and undermined the party’s option at national power or will allow for the possibility of collaboration.

As the opposition moves forward, PAS will need to show that it has something to offer politically besides its focus on hudud and reaffirm its commitment to Pakatan emphatically in its party polls.

The other Pakatan component parties will also have to find common ground, work toward respecting the choices of others, move away difference, and strive to build a stronger fabric of leadership for Malaysia. Pakatan will now have to engage in its own politics of containment and national consciousness.

There are limited reasons for optimism, but the possibilities of learning on all sides offers promise and a path ahead.

Part I: PAS’s hudud folly – a political putsch

Part II: PAS’s hudud folly – it’s not chosen by all

BRIDGET WELSH is a Senior Research Associate at the Center for East Asia Democratic Studies of National Taiwan University and can be reached at

Why NO to Hudud Law for Malaysia

March 19, 2015

Why NO to Hudud Law for Malaysia

by Azrul Mohd.

najib-on-hududNajib must have forgotten what he said on September 25, 2o11

The tabling of the Shariah Criminal Code Enactment II 1993 (Amendment 2015) in the Kelantan State Assembly and any move to amend the Federal Constitution to allow for the implementation of hudud at the State and Federal levels needs to be opposed by all right thinking Malaysians.

Personally, I will never support the imposition of hudud in this country. These are my four reasons:

Hudud is not needed in Malaysia.

The law should be and is more than just about punishing others. It is about the deliverance of justice. The penal laws at the centre of hudud were written during a time when harsh measures were necessary to impose peace, order and stability amidst a period of lawlessness, conflict and turmoil. They were guidelines for civilised behaviour formulated when and where there were few laws and men. Hudud was necessary there and at that time. Today, in our country, hudud law is neither necessary nor required.

We already have civil and criminal laws which provide for separate sets of laws and punishments. One of the primary tenets of Islam is about the deliverance of justice. The discourse surrounding the adoption and implementation of hudud in this country has barely made justice a mention, much less a priority. It has, however been very much about politics, punishing other people and posturing to “out-Islam” each other.

The adoption of hudud into practice, to me, would represent a failure of our existing legal systems to deliver justice. It would also represent a repulsive need to show others how Islamic we are and how holy we can be at the cost of signing away the liberties and freedoms of others.

Instead of delivering justice, hudud would compromise our existing systems and result in situations which cannot be easily explained away by holy verses and theological arguments.

Lack of accountability, transparency and standard of care.

Our religious department officials have hardly been paragons of these virtues. Whenever these issues are brought up, they have bristled with outrage, indignation and accused others of undermining or questioning their authority.

JAKIM’s Director General Datuk Othman Mustapha recently denounced the questioning of religious authorities as being part of a liberalism movement. As if you needed to be part of an ideology, belief system or movement, to be able to ask questions and demand accountability and transparency from civil servants who are paid with our (Muslim and non-Muslim) tax money.

In 2012, an amendment was made to the Mufti and Fatwa (Kedah Darul Aman) Enactment 2008 by the Kedah state government and passed unanimously by the State Legislative Assembly. The amendment made any fatwa of the state Mufti or Fatwa Committee, whether gazetted or not, unable to be challenged, appealed, reviewed, denied or questioned in any civil or Shariah court. In short, approving a measure which would effectively put a fatwa above the law and above the Federal Constitution.

NIK RAINA INTERVIEWNik Raina–Victim of JAWI’s Persecution

Consider the case of Nik Raina who has been pursued relentlessly by the Wilayah Persekutuan Religious Department (JAWI) despite a defective charge. JAWI’s actions were determined by three courts of law (civil and Shariah) to be illegal, of bad faith and unconstitutional. Yet they still are pursuing her after three years. This case has been the very definition of injustice and a neglect of the standard of care required of a legal criminal case. Instead they have been dependent on the tactics of bullying, intimidation, fear and oppression in the hope that they can beat Nik Raina into submission and defeat.

Islam requires the utmost prudence, caution and compassion in the enforcement of the law and prosecution of cases. The enforcement of hudud will be dependent on the religious departments to demonstrate a clear understanding of the basic legal principles of justice, fairness and compassion. They must also be open to dialogue, criticism and debate. They must be accountable, transparent and exercise prudence and care in enforcement of the law.

Based on recent examples and their behaviour, the parties involved in the discussion of hudud which include religious authorities, thus far have been anything but transparent and open with their intentions. They feel that they are above criticism. That they can do no wrong and are infallible. They feel themselves accountable to no one and need not explain themselves. That to criticise them is to question Islam.

Peddling away fundamental freedoms.

There is a reason for the Shariah system to be where it is under the Federal Constitution of Malaysia. Imposition of the hudud law involves changing the very agreement in which this country was founded on.

Hadi3The Father of Hududdism

Make no mistake, the attempts to rewrite the Constitution are no longer silent. Those who make the self-righteous claim to the mantle of champions and protectors of Islam seem to not hesitate to peddle away our freedoms and liberties at the altar of politics. Such repulsive behaviour is not the exclusive domain of one particular party but can be seen across the chamber and even in the civil service.

There will be those who will ask, why should you be afraid if you have nothing to fear? We know all too well that we have much to fear when the state becomes engrossed in persecuting its own people, looking for sin, finding fault where there is none, jumping at shadows and imagined threats. We have seen enough evidence of it.

Anyway, why should being a Muslim make it alright to be tyrannised and inflicted with injustice? Do Muslims not have the right as non-Muslims to equal protection and treatment under the law? Are we as Muslims to be deprived of rights and freedoms guaranteed under the Federal Constitution simply because of our religion? Why do we allow ourselves to be subject to possible bias, discrimination and religious tyranny?

Implementation of hudud will, without any doubt, affect all regardless of religions, ethnicity or creed. Non-Muslims should not and must not be silent just because they are allegedly not affected by the proposed laws. The eroding of our fundamental freedoms and civil liberties in the name of religion, affects everyone.

We must not allow these people to sacrifice our fundamental freedoms and rights for votes which will last only so long as the next election cycle or the setting of the sun. In these circumstances, there is no such thing as kasi chance lah. What is taken away will be very hard to be given back. If implemented, hudud will change our way of life as we know it in Malaysia.

Unjust means do not equate to Islam and justice.


The reasons used to justify the imposition of hudud have not evolved far from “It’s God’s law!” and calling those who criticise its imposition as liars, infidels and munafiks. This lazy defence of hudud not only amounts to religious blackmail to accept it wholesale but also implies that questioning it makes a person less of a Muslim in the sight of God.

These are some of the arguments which the champions of hudud in this country depend on. The great Islamic caliphates of old held great stock in intellectual curiosity and debate. Religious leaders back then were often also lawyers, students of jurisprudence, mathematicians, astronomers, medical doctors, philosophers, explorers and teachers. They were wise men and women who drew on the lessons of the world to decide when to use the spoken word, the pen and the sword to arbitrate and administer justice. Compare them to who we have enforcing religious laws in this country today.

The Quran also clearly states that there is no compulsion in religion. Yet, those who fight for hudud in this country tolerate no dissent or contrarian opinions and require unthinking, unblinking and blind obedience. When people tell you that you shouldn’t or are not allowed to use your mind or akal to reason or rationalise these issues, you know, you have a problem. They want unquestioning compliance and obedience.

Yet, the first word revealed to the illiterate Prophet Muhammad (pbuh) was Iqra, which means read or recite. It implies the need to learn. That there should neither be blind adherence nor unthinking compliance. Doing so would make us vulnerable to abuse, exploitation, bigotry and injustice which are all too human.

And as those who enforce hudud are human, they are neither infallible nor free from bias or prejudice. Vulnerable to ego and pride. Sins of arrogance, takbur and bongkak. We have seen evidence of this in the Nik Raina case.

How can we also trust these same people to implement and enforce a criminal code when they have barely been able to keep up on matters such as ensuring the rights of women on issues of inheritance, divorce and child custody?

Finally, let us not be naïve in thinking that non-Muslims will not be affected by these measures. The contents of a Department of Islamic Development Malaysia (JAKIM) strategic paper which states that hudud should be applicable to all, Muslims and non-Muslims alike, tells me that regardless of whether there is the requisite two-thirds majority support in Parliament, there are people working actively behind the scenes to make this universality a reality. The words of a former Chief Justice bring to mind how far up such sympathies can go. We cannot afford to be complacent. This is not just a political issue. This imposition affects all of us.

Muslims and non-Muslims have a right to speak out as we, as Malaysians, are all stakeholders of this country. At the end of the day, it is beholden on us as citizens of this country to decide how Malaysia should be. We look to the Yang Di-Pertuan Agong and the Sultans to safeguard the interests of all citizens, Muslims and non-Muslims.

For me, I will not subject myself or those who I care for and love to those who would use God’s name in vain in their overzealous pursuit for godliness and to demonstrate their individual or collective piety.

For all these reasons, I will never support hudud in Malaysia and I will resist any  measure which seeks to change the fundamental nature of Malaysia and its people.

*This is the personal opinion of the columnist.

1MDB is in financial distress–A.H.Manaf

March 17, 2015

1MDB is in financial distress: The Evidence is Clear for All to see, only Some don’t

by A H

1MDB-The Scandal

In November 2014, I penned an article calling for the Auditor-General to conduct a public audit of 1MDB, highlighting the warning signs and “alarm bells” which alert us to the case for investigation.

Since then, events have unfolded rapidly and I wish to update my opinion based on subsequent reports that have come to light.

1. 1MDB took up a US$1 billion loan in October 2014 (reported in Reuters IFR). This was reportedly a one-year bullet loan with repayment due in full in September 2015 – we do not know the use of proceeds, assuming they were not utilised to reduce existing debt, the company has now incurred a substantial addition of RM3.7 billion in short-term liabilities (in this case due in six months) to its previous debt picture of RM42 billion as at March 2014.

Ananda KrishnanAnanda Krishnan

2. Repayment of an existing RM2 billion bridging loan was postponed from November to December and finally January 2015 culminating in reports that the loan was settled by businessman T. Ananda Krishnan.

Confusing statements have been issued as to the source of the loan repayment. However, there are strong indications in the FY14 accounts as to how management planned to repay this loan.

As explained in the notes to the accounts (pg 170), the RM2 billion bridging loan is to be repaid with either proceeds from a proposed IPO or from an equity commitment by Tanjung. The latter is described as “a Subscription Agreement with Tanjung under which Tanjung agreed to subscribe for equity in PIH of up to RM2.0 billion on the occurrence of certain events… which proceeds shall be used solely for the repayment or prepayment by PIH for any amount owing under the RM5.5 billion loan facility”. As we know, the IPO slated for calendar year 2014 never materialised.

3. Confirmed reports that the government provided a “standby credit” of RM950 million of which more than two-thirds have been drawn in the short duration of two weeks following the granting of this credit.

I do not distinguish between “standby credit” and “loan” when a substantial proportion has been immediately taken up. In view of the haste with which the credit was approved and subsequently disbursed it would be more appropriately defined as an “emergency state-funded loan”.

4. Surprisingly candid statements by Finance Ministry officials which Ahmad-Husni-Hanadzlahconstitute a public admission of 1MDB’s precarious financial position: Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah described the company’s finances and “gearing ratio” as “unsustainable” necessitating “an exercise to rationalise and consolidate its assets”. In other words, 1MDB’s excessive debt levels compel the sale of assets to service and repay these debts.

5. Reports that 1MDB is unable to proceed with the 3B power project. More recently, the MOF refers to the company’s intentions to “transfer the project” and other reports indicate TNB will step in as a partner.

6. The sudden resignation of 1MDBs CEO whose replacement, Arul Kanda, announced stark changes in business direction under the guise of “strategic financial review” involving the sale of assets, including “land assets which may be sold outright or partly sold through joint ventures”.

Riza and Jho LowWhat is their role in 1MDB?

In simple terms, 1MDB’s proposal to “monetise” assets means it is embarking on the sale and liquidation of company assets, Husni’s subsequent announcement that they expect RM26bn of debt to be settled through “monetising” land banks and future property earnings indicates the asset sale will be extensive.

All of the above point to a clear picture – what we are witnessing here is a company in acute “financial distress” suffering from unsustainable levels of “corporate debt overhang”.

Financial distress is implicated by the company’s inability to meets its financial obligation in a timely manner, in the case of 1MDB a sovereign entity it appears to only meet its minimum obligations with assistance from i. government-funded emergency loans ii. funds extended by a third-party whose legal obligations are referred to in the notes to the accounts.

The reported problems with the 3B project are classic symptoms of a company in financial distress – it is in the unenviable position of having to reject lucrative investment proposals because i. its extensive debt levels render it unable to raise additional funding ii. a substantial proportion of its current revenues and cash flow goes to servicing existing debt.

As reported, 1MDB has had to call off a RM8.4 billion sukuk financing earmarked for the 3B project (Reuters).

“Corporate debt overhang” often leads to a vicious downward spiral. In 1MDB’s particular case, the loss of 3B has serious repercussions on its short-term financial position, too, because its debt reduction proposal is based on the IPO of its energy subsidiary Edra (claimed by the MOF to be slated for June or July 2015) which presumably would be significantly enhanced by the inclusion of a lucrative new power project.

Other symptoms of “corporate debt overhang” include excessive cost of borrowings when a company struggles to raise further financing to fill its operating gaps.

The notes to 1MDB’s FY14 accounts detailing interest on borrowings (pg 122) show this to be the case: for example a RM1 billion “junior Islamic debt” drawn down in 2014 incurred a whopping annual interest rate of 18.1%.

Therefore, I must disagree with the Second Finance Minister’s contention that the recent emergency government loan to 1MDB “does not in any way constitute a bailout” because bailouts are only extended to “a failed organisation”.

He added that “the company was facing cash flow problems not due to management problems”. Successful companies plan their business operations, funding requirements and timescales responsibly, regardless of any possible returns that lie in the future, a company’s failure to plan to meet its short-term obligations invariably leads to bankruptcy.

This brings us to my next point about “going concern”, the fundamental principle upon which financial statements are prepared.

With the next financial year end March 2015 only two weeks away, I fail to see how 1MDB’s external auditors Deloitte can continue to rely on the appropriateness of this assumption without an explicit guarantee by the company’s shareholders, the MOF, that it will meet the company’s financial obligations.

In short, 1MDB can no longer be considered a “going concern” (an entity ordinarily viewed as continuing in business for the foreseeable future) without financial support from the Ministry of Finance i.e. the government.

I highlight this point of interest in view of widespread public concerns about possible “government bailouts” of 1MDB. Indeed in order to sign off the accounts of the company on a going concern basis, the external auditors would expect a letter from the shareholders, MOF, stating its explicit commitment to provide the necessary financial support to 1MDB.

The alternative would be for the financial statements to be prepared on a non-going concern or “break-up” basis.

Parallel to these developments is the startling revelation in blog and press reports claiming 1MDBs links with fraudulent and criminal activities (The Sarawak Report, The Sunday Times UK. The latter claims to have “seen” relevant email evidence).

In my previous article, I analysed publicly available information which signals “alarm bells” or “red flags” suggesting the possibility of irregular or fraudulent activities indicated by 1MDB’s frequent changes in external auditors, multiple and inexplicable late filings, unusual revaluation policy which served to mask its balance sheet insolvency, as well as the mysterious circumstances of the origins of the notorious US$2.3 billion Caymans funds.

ambrin-buangThe AG: His findings on 1MDB eagerly awaited

Significantly, the revelations in these blog and press reports have culminated in an instruction to the Auditor-General (AG) to conduct a public audit of 1MDB, an engagement I had called for more than four months ago.

Notwithstanding the possible conflict of interest arising from the instruction given by the Prime Minister who is also the Finance Minister and Chairman of 1MDB’s advisory board, I welcome this move of a public audit and hope the AG will undertake his heavy responsibilities with independence and credibility.

Critically the task requires a forensic audit (a specialised branch of audit which plays a crucial role in investigating suspected financial fraud and misappropriation of assets) with assistance from external specialist forensics if necessary.

For a methodical approach demonstrating credibility to the public, deadlines and time frames should be established, as well as clear terms of reference for the audit which should be made publicly available. These are crucial to allay public fears about the efficacy and intent of the public audit. The terms of reference should include but not be confined to the following:

  • determine adherence to principles of corporate governance by 1MDB’s board and management;
  • assess all evidence to determine any incidences of corporate malfeasance;
  • determine the authenticity and validity of a number of 1MDB’s controversial transactions and the extent of potential prejudice the company may have suffered through such transactions .This includes the joint venture with Petrosaudi; portfolio investment in offshore Caymans funds; the bond issue via Goldman Sachs; the option agreement with Aabar and compensation thereof relating to the proposed IPO; the joint venture with Aabar undertaken by 1MDBs former subsidiary SRC involving RM4 billion EPF funds, including investigating the reasons for and circumstances surrounding the transfer of the company’s ownership to the MOF; and,
  • quantify the magnitude and timing of 1MDBs current obligations and likely restructuring and financing cost.

All of the above will necessitate extensive work to (i) trace the flow of funds and other assets. (ii). construct a detailed chronology in order to understand and trace complex sequence of events of the company’s various transactions iii. identify relevant persons to interview, and conduct and document the interviews without fear or favour.

The interviewees should include current and previous management, current and previous members of the board of directors and advisory board, current and previous external auditors, any other persons including external advisors and associates who may be directly involved in the company’s transactions under investigation and any other persons who may be directly implicated by corporate malfeasance and fraudulent activities.

In view of the international nature of the company’s transactions and flow of funds and assets, the AG needs to assess the possibility of early referrals to criminal authorities to facilitate cross-borders investigations.

Assistance from and cooperation with PDRM, its overseas counterparts, Bank Negara and other relevant authorities will be essential.

In other words Tan Sri Ambrin Buang, good luck! The nation is depending on you to conduct this complex and critical undertaking with courage, integrity and professionalism.

* A.H. Manaf reads The Malaysian Insider.

* This is the personal opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insider.


PM Najib has too much power

March 16, 2015

PM Najib has too much power, says Kuala Terengganu Member of Parliament

by James

Kuala Terengganu MP Raja Kamarul Bahrin Shah Raja Ahmad has stressed that too much centralized authority of the executive branch under Prime Minister Najib Abdul Razak’s administration is the main reason for some of the problems faced by Malaysia today.

Raja Kamarul Bahnrin

At a press conference outside Dewan Rakyat, Raja Bahrin said, “In 2014, I called for Najib to relinquish his post as the Finance Minister as a lot of centralized authority was vested in him.

The Kuala Terengganu MP went on to point out that 1Malaysia Development Berhad (1MDB), the government-owned strategic investment company, and Penang businessman Jho Low did not even seek the approval of Bank Negara to transfer billions of ringgit out of the country to the Cayman Islands, as discovered by the Sarawak Report.

“It’s not healthy. It (the transaction) just got the approval from the ‘higher ups’, which usually means the Finance Ministry or the Prime Minister,” he said. “Malaysia ranks among the highest in illegal cash flow out of the country after China – RM 1 trillion in ten years. It’s a chronic disease of the nation that has to be rectified, not perpetuated.”

The recent cabinet’s hesitation to approve a RM3 billion cash injection for 1MDB, Raja Bahrin feels is an indication that other ministers are also worried about 1MDB. “That was an unofficial vote of no-confidence of the Prime Minister by the cabinet ministers.”

Raja Bahrin also highlighted the openly lavish lifestyle of the first family, while the people have to deal with rising cost of living, oil, food and housing. “The Prime Minister himself, his wife and his step son seemed so closely associated with the production of big budget Hollywood films that cost USD 100 million each, buying luxury homes in the United States as well as having a stand out social profile abroad.”

Raja Bahrin, lamented that on the contrary, local fisherman are the worst hit with poverty as there is no political will to look after their welfare.

He said, “The fishermen in Kuala Kemaman, the oil and gas center of Malaysia only had RM 14 increase in wage in ten years – from RM 400 to RM 414. “Their catch is dwindling, and hence their income. Ministers promised to cancel licences to foreign boats a while back but have to still act on it.”

Back in 1997 the same ministry cancelled hundreds of licenses only to award them to a company owned by a prominent corporate figure, that further affected the income of the fishermen as it created a monopoly. “It’s obvious that cancellation of licenses can be done. It has been done before, why not now? “Where is the political will?” asked Raja Bahrin.