1MDB - NAJIB'S MOTHER OF ALL SCANDALS: SCREW-UP OR DELIBERATE PLUNDER?

1Malaysia Development Berhad (1MDB) is a strategic development company established to drive strategic initiatives for long-term economic development for the country by forging global partnerships and promoting foreign direct investment; or so they claimed at 1MDB. It is supposed to be another sovereign fund like Khazanah and is chaired by Prime Minister cum Finance Minister Najib Tun Razak.

But after 3 CEOs, 3 Auditors and 2 Chairmen later and reeling in debts of RM42billion, 1MDB still say that there is nothing wrong even though the sovereign fund had missed its December 31, 2014, deadline for settlement of a RM2billion loan. It received an extension up to January 30, 2015, to settle the outstanding payment. The loan was first due on November 30th.

It was reported that top executives from 1MDB were given a dressing-down by Bank Negara recently, and were told in very strong terms that they will face action if the matter is not settled.

Despite the assurance of Deputy Finance Minister Ahmad that the RM4billion parked in the Cayman Islands would be returned by November last year, they have not done so until today.

So the question being posed today; are the Cayman funds tied up in “investments” of highly questionable value, which if disposed today will result in massive unbearable losses to 1MDB?

The collapse of 1MDB will threaten Malaysia’s financial system

This “delay” in the repatriation of funds is crucial as it not only raises the question of 1MDB as a going concern but also threatens the entire stability of the Malaysian financial system. The failure of 1MDB to repay just the RM2 billion loans will severely affect the financial health of 2 of the country’s largest banks.

Worse, a loan default will automatically trigger a default in the balance of RM40 billion of debt in the books of 1MDB. Such an outcome will be catastrophic to the Malaysian Government, the entire financial system and of course the ultimate bearer of the brunt, the Malaysian tax-payers.

1MDB has announced that they have already redeemed more than RM4 billion in the segregated portfolio company (SPC) registered in the Cayman Islands and in the process of redeeming the balance. Yet, it is struggling to repay the RM2billion.

At the rate1MDB is heading, this entity is going to be Malaysia’s biggest financial disaster, if it goes under, according to DAP Tony Pua.

With the new change of CEO, the government is insisting that it is "business as usual" when it has underwritten a significant part of its debts presumably using tax payer's money, while many believe that 1 MDB assets and land banks are overvalued by many folds.

Many believe that by taking the true values of the assets compared with its liabilities, 1 MDB may already be insolvent and should be liquidated. For this reason even renowned audit firms dare not sign its audited accounts.

Malaysia is in for a serious economic beating, dragging our country’s economy with it, if 1MDB is unable to mitigate its debt and go bust. RM42billion in debt is no small matter, and it could take forever to clear this debt leaving the Rakyat again to pick up the pieces.

Now that the government has washed its hands off the subsidy for petrol, and with impending GST and income tax coming in soon, oil barrel prices at and all time low, our Ringgit getting weaker by the day; it sure looks gloomy for this country. And yet we see the Prime Minister jet setting around the world on a private jet, running up nearly a half million ringgit worth of bills with a hippo in tow.

Glaring cover-ups and denials

Ahmad Maslan

1MDB has been surprisingly quiet, amidst all the allegations levelled at it, making little attempts to comfort the public. DFM Ahmad Maslan’s feeble attempts to take questions over 1MDB have made him sound like a fool with his contradictory statements on the letters of guarantees issued by the government.

Second Deputy Finance Minister Chua Tee Yong’s blatant refusal to take questions on 1MDB, and the Auditor General’s refusal to audit 1MDB’s books, shows that something scandalous is about to hit the streets and it is time for Malaysians to start panicking.

Najib has been elegantly quiet throughout the controversy, refusing to take any questions or comment on the matter. Calls for him to come clean have reached a crescendo with an Umno Divisional Leader making police reports to investigate Najib and 1MDB.

How did Najib screw up so badly?

But how did Najib, despite being surrounded by advisors, managed to blunder so big time? Hardly five years at the helm as Prime Minister and Finance Minister he managed to rake up a cool RM42billion in debts and RM49billion in liabilities with 1MDB? Are his Economic Advisors sleeping?

The increasing calls for him to resign the Finance Ministry’s post were ignored, with him hugging the post with both arms. At one time, he even took on the role of Women’s Minister much to the amusement of Malaysians.

Najib’s PMship is at risk, not because he didn’t do anything concrete for the country, but for his uncanny ability to get himself into all kinds of trouble. RM42billion is not exactly chicken feed. You can literally buy a small country somewhere in Africa for that kind of money.

Even our ex PM Tun Mahathir commented that our national sovereign fund Khazanah’s performance is nothing to shout about, so why the need to create another white elephant?

Mother of all scandals

Batu Kawan Umno division deputy chief Khairuddin Abu Hassan, the man very much in the news since lodging a police report on the 1MDB scandal

The NFC scandal which received nationwide condemnation sounds like peanuts, while the PKFZ scandal pales in comparison. In fact, none of the nation’s many outrageous scandals like missing jet engines, scorpene submarines etc. come close to the mega 1MDB scandal. One wonders, if Najib is trying to out-scandal Mahathir, Daim, Taib and all the others?

The 1MDB controversy surfaced a couple of months back when word has it that the secrets of 1MDB were leaked by certain top guns in Umno to the Opposition to attack PM Najib and to hasten his demise. Even certain Umno leaders and Umno bloggers were supportive of what the opposition alleged and were making the same allegations against Najib.

Is MACC acting on it?

Now, that an Umno Leader has made an official Police report against Najib and 1MDB; have MACC and the police started investigations, or are they still pretending that nothing is wrong?

Umno leaders and bloggers should hand this evidence to the MACC, so that legal action can commence and the perpetrators brought to book.

The public demands to know the truth about 1MDB

Is 1MDB really in trouble, and can the money be recovered and how much of it; is the question on everyone’s lips.

And if 1MDB’s woes are the prime reason that the government decided to raise petrol prices, abolish fuel subsidies, force implement the Goods and Services Tax (GST), then the public has every reason to be concerned.

1MDB’s failure to submit its yearly Financial Reports to be audited and certified by the auditors’ in time is scandalous, disgraceful and shows a glaring lack of transparency. Since it concerns public funds, the public has a right to know what is happening,

Why did Najib refuse to answer these questions or direct the ex-CEO of 1MDB to be transparent about their accounts and release the audited accounts? If 1MDB is clean and above board in its dealings, there should be nothing to hide? Isn’t it time to grill all the former Chairmen, CEOs and auditors to unravel the mess 1MDB created and to hold them accountable?

Is the new CEO replacement another smokescreen to calm the jittery public that 1MDB ‘is business as usual’?

Why is Najib suing Tony Pua?

DAP Tony Pua was served a letter of demand allegedly defaming Najib in a YouTube video entitled: Najib is creating the biggest scandal ever in the history of Malaysia. The letter of demand contained six elements: stop it immediately; retract all allegations; withdraw offending material; apologize; promise not to do it again; and offer suitable compensation.

Najib’s lawyers claimed the video accused Najib as an incompetent prime minister, creating the biggest scandal in the history of Malaysia, a conspirator, corruptor, abuse of power; was cruel, harsh, autocratic, not open to criticism; tyrannical and oppressive, which caused him “tremendous stress and embarrassment”.

Suing Pua will open a can of worms, documents would be declassified and more dark secrets of 1MDB like monies deposited to names and accounts will be revealed to the public through the court. The world will know about this alleged financial mismanagement, unless of course it is reclassified under the Official Secrets Act and a blanket ban" on any public discussion on the finances of 1MDB.

Suing Tony will also give the impression that there is an attempt to suppress the truth about 1MDB and that Tony and Rafizi is right,

Already the side-effects have begun.

Rafizi Ramili (Right) and Tony Pua

PKR Rafizi Ramli has warned that, Malaysians will have to fork out up to RM1 billion in higher electricity tariff due to delays in the completion of the 1MDB Jimah east power plant, "This cost will be borne by the people in the form of higher electricity tariff," he said.

With a RM1billion here and there to be borne by the public, every time 1MDB coughs, it won’t be long before the nation buckles under.

All the talk of our electricity bill going down in tandem with the world petrol price is just wishful thinking. Malaysians have no choice but to get ready to pay higher electric bills, higher petrol prices when unsubsidized petrol shoots up again one day, and a higher cost of living due to GST.

Take care of our health, as it will be very costly from now on, if we fall sick. Shop at the wet market and bargain for RM1 chickens and cheap kangkong and Chinatown for cheap Birkin handbags or fake diamonds. - MAILBAG