End corporate donations, says anti-graft group after WSJ claims of GE13 funding

Transparency International Malaysia president Datuk Akhbar Satar reiterates calls that political funding should come from Putrajaya or state governments, not corporations, to end the perception that political parties are the most corrupt institution in the country. – The Malaysian Insider file pic, July 7, 2015.

Corporations should not make donations to political parties to prevent private agendas from influencing election outcomes, watchdog Transparency International Malaysia has said, amid recent claims that funds from 1Malaysia Development Bhd (1MDB) had partly financed the 2013 general election (GE13).

TI-M president Datuk Akhbar Satar said instead, state funding should be used to bankroll election campaigns, among a slew of other political funding reforms that the international anti-corruption group has been advocating.

He also told The Malaysian Insider that a list of "non-permitted" donors should be drawn up, including government-linked companies (GLCs), non-citizens and foreign organisations.

Akhbar said this when asked to comment on a Wall Street Journal report last month alleging that Genting Plantations had donated US$10 million to a charity organisation called Yayasan Rakyat 1Malaysia, which was then used to bankroll GE13.

The donation was allegedly made after debt-ridden state investment arm 1MDB paid above market rates to purchase a power plant from Genting Group at RM2.3 billion.

"Corporate companies must also declare their political contributions for transparency and accountability to their shareholders," Akhbar said.

State funding, he said, should be allocated by the government to bankroll election campaigns, that is, the federal government to allocate funding for parliamentary elections and the state government for state elections.

“A formula could be worked out based on the following factors: urban, rural and number of voters.”

He added that all contributions must be channelled to a party's official accounts and not to personal bank accounts.

Akhbar urged that laws to govern political financing be implemented urgently because of the perception of political parties being the most corrupt institution in Malaysia.

This was based on a survey called the Malaysian Corruption Barometer, undertaken last year.

Akhbar said the Election Offences Act 1954 should also be amended to make it mandatory for parties' election expenses to be audited by certified auditors before being submitted to the Election Commission (EC).

Admitting that a lack of transparency and accountability in terms of political financing in Malaysia was a "cause for concern", Akhbar also called for equal media access for all political parties, adding that the fight against corruption needed to start from the top of political parties, with leaders setting an example.

In 2012, Prime Minister Datuk Seri Najib Razak had promised that political funding would be regulated by the government, requiring all donations to be made to official party accounts and that an official acceptance receipt must be included in party accounts to be recorded in a party's financial statements.

However, to date, the government has not imposed any such rules.

In 2012, controversy broke out regarding a RM40 million donation to Umno Sabah, the source of which was not disclosed.

It was the subject of a Malaysian Anti-Corruption Commission (MACC) investigation into Sabah Chief Minister Datuk Musa Aman. 

However, the MACC cleared Musa of graft and money-laundering allegations after finding that the RM40 million allegedly channelled to the Sabah chief minister was meant for Sabah Umno’s use.

- TMI