The public’s not stupid, 1MDB told

Umno's Khairuddin Abu Hassan demands answers to two simple questions.

PETALING JAYA: 1MDB CEO Arul Kanda Kandasamy was today accused of insulting the public’s intelligence with his statements regarding the financial health of the government-owned company.

A prominent 1MDB critic, Khairuddin Abu Hassan of Penang Umno, said Arul has failed to answer basic questions about the company in any of the public statements he had given.

Referring to the CEO’s invitation to critics to engage personally with him, Khairuddin said: “Why should we waste time meeting Arul for clarification? He would only twist facts instead of responding to issues raised.”

He said the public had two “simple and easy” questions for Arul: “Why must 1MDB borrow money to settle its debt?” and “Where are the funds said to have been fully repatriated from the Cayman Islands?”

Khairuddin, the vice-chairman of Batu Kawan Umno, became prominent when he made a police report seeking investigation into 1MDB’s management of its funds. He followed up that report with an MACC report.

In a telephone interview with FMT, he noted Arul’s statements assuring the public of 1MDB’s financial stability and the integrity of its performance as a development fund.

“Unfortunately,” Khairuddin said, “the company has had to borrow to settle its RM2 billion debt with Maybank and RHB Capital.” This meant that Arul’s statements were attempts to “straighten a wet thread,” he said, using a Malay proverb.

Referring to the RM8.3 billion allegedly repatriated from the Cayman Islands, he noted that neither Arul nor any member of 1MDB’s board of directors has given an answer to the question regarding to where the funds are being kept now.

“It’s not a small amount,” he said, adding that the mismanagement of the funds could have a devastating effect on the national economy.

“I challenge Arul Kanda to give a clear statement which lists all of 1MDB’s debts, inside and outside the country,” he said. “This list should be open to public scrutiny. Similarly, there must be a list of all of 1MDB’s assets so that the public can clearly understand its current position.

“Arul Kanda must also clarify his position in 1MDB and the terms of his employment. Is 1MDB paying him a salary or is he with the company only to protect the interests of a finance corporation in Abu Dhabi?”

Arul previously served as Executive Vice-President and Head of Investment Banking at an Abu Dhabi commercial bank.

“1MDB must learn to be transparent in its administration and spending of 1MDB funds,” Khairuddin said. “1MDB is not a private company, but is 100% owned by the Finance Ministry. All Malaysians therefore have the right to ask questions about its real financial position.”

He also said the company had nothing to do with Umno or Prime Minister Najib Abdul Razak. “Although Dato Seri Najib chairs its advisory board, 1MDB is managed on a day-to-day basis by a panel of executive managers and its board of directors.”