Malaysia Blocks UK-Based Critic

July 22, 2015

by John Berthelsen

http://www.asiasentinel.com/politics/malaysia-blocks-uk-based-critic/

After months of devastating reportage by the UK-based Sarawak Report, the Malaysian government has had enough, attempting to block the internet site, edited and mostly reported by former BBC reporter Clare Rewcastle Brown.  However, almost immediately, social media have come alive with alternate routes to the site, making the government attempt look futile.

Readers attempting to access the site on July 19 were greeted with a notification in Malay and English by the Malaysian Communications and Multimedia Commission that “This website is not available in Malaysia as it violates the National Law.” As far as can be determined, it is the first time the government has closed down a website and it is reminiscent of an action by former Prime Minister Mahathir Mohamad in 1986 when, infuriated by detailed reporting on a variety of scandals, he ordered two Asian Wall Street Journal reporters out of the country within 72 hours.

Malaysia’s Center for Independent Journalism condemned the blockage, saying that “For any restriction on the guaranteed right of freedom of expression to be legitimate, it must firstly be authorized by a specific law. There must also be adequate provision for a website that has been blocked to appeal and challenge the decision of MCMC.  

The government’s action came at the end of a week during which it attempted to prove Brown had used documents allegedly doctored by Xavier Justo, a Swiss national now in jail in Thailand, to lay out detailed charges of massive fraud surrounding the scandal-ridden 1Malaysia Development Bhd. state-backed investment fund.  According to local media, Justo downloaded 2 million emails from PetroSaudi International, a Middle Eastern oil exploration company through which stolen funds are alleged to have passed. Justo was once an officer of the company but was paid the equivalent of US$5 million to leave. Apparently he sought to sell the documents to the highest bidder in Singapore. Brown did not pay for them.

Brown, on the Sarawak Report page,  called the commission’s action “a blatant attempt to censor our exposures of major corruption through the development fund 1MDB, including the information that nearly US$700 million of 1MDB-related money was paid into the Prime Minister of Malaysia’s personal AmBank account in KL just before the last election. This information has already long been disseminated and backed up by other major global news organizations, so we can only assume that the MCMC is fearful that we are about to bring out further revelations.”

The New Straits Times, owned by the United Malays National Organization, quoted a Thai Police lieutenant general as saying Justo had confessed to doctoring emails he had obtained from PetroSaudi International. But the Associated Press reported that Thai officials had refused to share any information on Justo with Malaysia.

In any case the allegations against Brown were almost immediately knocked down today [July 20] by an equally detailed report by The Edge Financial Daily, Malaysia’s leading business publication, titled “How Jho Low & PetroSaudi schemed to steal money from the people of Malaysia via 1Mdb.”  The article supports virtually every charge Brown has made against Prime Minister Najib Tun Razak and the officials of 1MDB.

The 2,800 word article, complete with flow charts, describes in overwhelming detail the money trail by which US$1.83 billion was stolen from 1MDB by individuals connected PetroSaudi International and diverted into various accounts at banks in Singapore, New York, Switzerland and London by Jho Low, the young tycoon and family friend of Najib’s who was instrumental in setting up 1MDB in 2009, as well as two PetroSaudi officials and officers of 1MDB itself.

The government has threatened to pull the publishing licenses of both the financial daily and its affiliated publication The Edge Weekly over their aggressive reporting on 1MDB.

As the charges over 1MDB have continued to pile up – including one by Sarawak Report and the Wall Street Journal that US$680 million had been diverted from companies connected to the investment fund had ended up in Najib’s own account – Najib’s UMNO allies have pulled out all the stops, using the New Straits Times and other party-owned, Malay-language newspapers, radio and television and an army of bloggers to attempt to discredit the reports. 

Bloggers and government officials over the past three weeks have issued a barrage of charges against Brown, including one by a onetime employee of Radio Free Sarawak, also started in 2010 by Brown that the former employee had participated in faking evidence against the government.  But his charges have been largely discarded, partly because of an email he presented as “proof” had been doctored.  He has never written for or edited the Sarawak Report, Brown said. A picture of a man identified as Brown’s “mastermind” online forger of documents in the UK turned out to be the manager of a bus station in Norwich.

To most middle-class Malaysians, the government’s campaign against Brown and the international media including the New York Times and the Washington Post carries little weight. It is clear, especially since the stories have been backed up by local reporting on The Edge Financial Review, Malaysian Insider, Malaysiakini and other websites, that 1MDB faces a huge financial crisis.  It has struggled to find the money to meet its loan obligations and a planned IPO looks dead for the foreseeable future.  It has dismissed its auditors twice after they refused to issue unqualified reports. 

But the question is how the scandal plays in the kampungs, the rural villages in the Malay heartland that provide UMNO with a reliable supply of votes.  UMNO’s support has been draining away in successive elections although now, with the opposition near collapse, and with an election three years away, it remains to be seen if UMNO can repair itself.  Its component parties in the Barisan Nasional, or ruling national coalition, have become irrelevant.  The next big test is the Sarawak state election, which must be held before August 2016.  At the moment, say political analysts in Kuala Lumpur, the Barisan holds a strong lead, if not an insurmountable one.

UMNO Uses Whistleblower’s Arrest to Defend 1MDB

June 28, 2015

by John Berthelsen

http://www.asiasentinel.com/politics/umno-use-whistleblower-arrest-defend-1mdb/

Malaysia’s political establishment is using the arrest of Xavier Justo in Thailand to try derail questions over the ill-starred 1Malaysia Development Bhd Fund that go far beyond whether the whistle-blowing Swiss national did or did not steal and doctor documents and pass them to Sarawak Report, a critical blog run by a British reporter.

The United Malays National Organization has mounted a full-court attack on Sarawak Report and the Malaysian financial publication The Edge, threatening to crack down on The Edge’s printing license and driving a campaign through allied bloggers, the UMNO-owned New Straits Times and other media.

Prime Minister Najib Tun Razak himself threatened action against Sarawak Report, which responded angrily that there was no wrongdoing. At the same time, there appears to be a move to tie Mahathir Mohamad, the nonagenarian former premier and 1MDB’s fiercest critic, to allegations that the case against 1MDB has been doctored. 

For months, 1MDB has been under significant pressure both from the political opposition and some members of Najib’s own UMNO to come up with answers over what has become of RMB42 billion [US$11.3 billion] in liabilities the state-funded investment company has accrued since it came into being six years ago. Some sources in Kuala Lumpur say as much as RMB25 billion may be unrecoverable. Najib and company officials have been scrambling to find funds to meet regular interest payments, some of which have been deferred, apparently for lack of funds to meet them.

Thais Nab Justo in Koh Samui

Justo was arrested by Thai police in the presence of reporters and photographers from the UMNO-owned New Straits Times to record the event and print a front-page story accusing the “heavily tattooed Justo” of a long series of sins including theft and attempting to blackmail officials of PetroSaudi International, a controversial oil exploration firm closely connected to 1Malaysia Development Bhd, whose problems are said to threaten Malaysia’s entire financial structure. 

“This shocking story had the country talking,” according to the New Straits Times. “Who is Xavier Andre Justo? How could such a sorry figure have ignited a major Malaysian political storm? What motivated this man, so disconnected from the nation of Malaysia, to launch such a callous attack on our people without a thought for the consequences? The answer appears to be cold, hard cash. Greed can be a route to riches, but it can also be a dangerous road to ruin, as Xavier Justo is learning the hard way. Now, he finds himself in a Thai jail awaiting prosecution on charges of attempting to blackmail and extort money from his former employers; with further charges to follow in the United Kingdom and Switzerland.”

Home Minister Ahmad Zahid Hamidi threatened to take action against Sarawak Report and The Edge, a leading financial and investment news publication, both of which for months have been breaking embarrassing stories on the parlous state of 1MDB’s finances and on the connections between flamboyant young financier Low Taek Jho and Najib. Jho Low, as he is known, and Najib were instrumental in establishing 1MDB in 2009. Najib remains as the fund’s chief financial advisor.

 Home Minister’s Threat

Zahid charged that The Edge and Sarawak Report had been “spinning the facts” over the state of 1MDB’s finances. The government is armed with colonial-era legislation under the Printing Presses and Publications Act and the Communications and Multimedia Act to attempt to deny licenses to what it deems to be offending publications.  With Sarawak Report headquartered in the UK, however, Zahid’s threat remains an empty one.

Justo, who left PetroSaudi several years ago, somehow got back into the company’s computers to download 3 million emails that allege damaging information on the transactions with 1MDB and a company closely connected to Jho Low, as he is known.

There have been attempts to tie Justo’s revelations to Mahathir.  In a report by Malaysia Today, a blog also operated from the UK, Raja Petra Kamarudin said he had been told Sufi Yusof, Mahathir’s secretary, had made “a number of trips to Thailand over the past year to meet [Justo] and the Thai authorities are trying to establish this through immigration records.”

If the Thai authorities manage to establish that some of the documents and e-mails were, in fact doctored, Raja Petra wrote, “and that Sufi did make a few trips to Thailand to meet [Justo] and was aware of, or was a party to, this fraud, it is not going to look good for Dr Mahathir.

A Furious Brown  Answers

Clare Rewcastle Brown, the UK-based blogger who publishes the Sarawak Report, fired back with a furious 1,600 word riposte in which she threatened to sue for libel and defended on a case by case basis the documents that PetroSaudi officials alleged were doctored.

“Sarawak Report will be demanding satisfaction over these false allegations of ‘tampering,’” she wrote. “We suggest these misrepresentations are added to the list of potentially criminal activities by PetroSaudi, whose false charges on this point currently number amongst the allegations that have landed [Justo] in a jail in Bangkok.”

The blog, Brown said, “has closely researched the extremely serious and libelous allegations, which claim documents relating to our coverage of the PetroSaudi 1MDB joint venture were ‘tampered’ and ‘distorted’ in order to ‘creatively alter’ the truth. We can now prove that these allegations are demonstrably untrue, by examining the evidence on which they were based.

So, she wrote, “our message to those who have accused us is check your facts before you sound off your accusations and start to worry about libel suits, if you have defamed us or an innocent man who is now in jail. We can confirm that there is zero evidence brought forward so far to substantiate the claims of ‘distortion’ made over the past 48 hours by the New Straits Times and taken up by certain media, bloggers and UMNO politicians.”

Indeed, she charged, “the little evidence that has been provided by these parties can be shown to confirm the exact opposite, which is that there has been no tampering of documents. Even so, people who could also have made the very same checks have falsely alleged that Sarawak Report and the Edge newspaper lied and deliberately misled readers with ‘distorted’ information about 1MDB’s missing billions.”

The New Straits Times, she said, never bothered to substantiate “grave and libelous charges” by showing their readers the actual evidence.

“As Sarawak Report pointed out yesterday, we corroborate our claims, so why can’t they? The reason turns out to be that it is startlingly easy to show that the claim is completely untrue.”

1MDB: Where is the RM42 billion?

June 1, 2015

1MDB: Where is the RM42 billion? Just give us an honest answer and stop the bull, Mr Prime Minister

by Scott Ng@www.freemalaysiatoday.com

Some days, I really do wonder what happens up in Najib’s office at Putrajaya, where I imagine a veritable horde of PR consultants, headed by Lim Kok Wing, work tirelessly to try to salvage the much damaged reputation of the Prime Minister. Sweat on their brows, they toil into the late hours to find answers to the questions thrust at the Prime Minister day in and day out, hoping to find a way, any way, to counter the vicious onslaught of Mahathir Mohamad.

I do feel pity for the PR team. They have great odds stacked against them. But then another FAQ appears on Najib’s website that makes me slap my head in disbelief and I remind myself that they’re paid handsomely for their services and thus should be castigated in full measure for their failure to get the Prime Minister to make the right moves.

As blogger Jebat Must Die points out, the FAQ is misleading and, once again, fails to actually answer the questions it purports to answer. For one, it’s riddled with semantics instead of answers, like Najib’s “explanation” for the unaccounted billions that should be in 1MDB’s coffers.

Mr Prime Minister, no one said that the money was a “loss” as that would mean that there would be a paper trail to bad investments or sudden market fluctuations. What we’re asking is, where is the money?

It is quite weird that so much money could just vanish into thin air, and Jebat makes a good point in pointing out that 1MDB purchased RM15 billion worth of assets. If those billions came from the RM42 billion that 1MDB is in debt for, there should be RM27 billion left, aside from the company’s RM51 billion in assets.

For that matter, there is also the extremely valid question of why the 1MDB cannot seem to handle its own corporate crisis communication, leaving our beleaguered PM to answer all queries. You’d think that a company worth billions would invest in a crisis communication team since scandals and such are bound to come up every once in a while. One really has to wonder how much time Najib has for actual governance while he runs around putting out 1MDB’s fires.

The Prime Minister seems unable to get anything right, trying his hardest to pass the buck for the 1MDB to whomever he can shunt it to (most recently, the Auditor-General) only for it to blow up in his face. Jebat makes another great point in recalling that Najib truly is a career politician with no real-world experience, and as history has shown, pampered elites are quite usually disconnected from the rest of the world.

Attempting to attack Mahathir without answering his questions directly is not a viable method of discrediting the former Prime Minister, especially since those same questions are echoed by the general public, the opposition and civil society members. In releasing so-called answers that fail to address the questions, the Prime Minister seems to be taking us for fools yet again despite the public contempt for his previous FAQ, which suffered the same delusional disconnect from reality.

Now that documents have leaked that show Najib has to approve all major investments made by 1MDB, it seems like there truly is no road for his redemption. He is now personally answerable for all the bad investments, the vanished money, and all the baggage that comes with 1MDB, and no amount of out-of-touch FAQs can redeem a brand that damaged.

Fight on if you will, Prime Minister. Give us a good show, and keep us entertained. We’ve paid for it already, anyway. But when the inevitable happens, know that you were the architect of your own fall, not Mahathir, not the opposition, not the “liberals” your administration seems to sneer at, not civil society. You were your own worst enemy.