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Monday, July 3, 2017

1MDB, forex losses - never again!



Just as I predicted in the first paragraph of my new book ‘GE14: The Big Issues’: “Malaysia’s 14th general election will no doubt be fought between a Barisan Nasional coalition that boasts its sixty years of “stable rule” and a Pakatan Rakyat coalition calling on the electorate to “save Malaysia” from the BN’s kleptocracy.
"There will certainly be plenty of the usual mudslinging on both sides and Malaysian voters will likely be treated to tirades about current scandals including 1MDB, as well as past scandals such as the forex losses, now that the former prime minister has joined the opposition…!”
It is great that Pakatan Harapan will be going around the country to expose the BN’s 1MDB scandal. The rakyat who do not already know about this scandal will get to know about how more than RM40 billion of our sovereign wealth has been squandered by the coalition that has run this country since Independence.
Equally wonderful is the fact that the Barisan Nasional will be going to town about the more than RM30 billion forex losses incurred by Mahathir’s government during the nineties. The old man may even get a taste of what incarceration feels like if he is found to have misguided the cabinet and Parliament in the nineties and squandered so much of our valuable assets.
If Mahathir had not joined the Pakatan Harapan coalition, Harapan would only have been tainted with the corruption charges against the chief minister in Penang and the allegations of corruption by Harapan themselves against the former Menteri Besar of Selangor. Worse luck, thinking they had roped in a big fish to trawl for rural Malay votes, Harapan must now bear the cross for the former kleptocrat’s sins!
Karma Chameleon
It never fails to amuse me that the laws of karma work in such a way that ensures that justice will always prevail, even in what too often appears to be so unjust a world. Who would have thought that two decades after the Mahathir administration had frittered away more than RM30 billion of Malaysian taxpayers’ money in the forex losses, we would finally have a Royal Commission of Inquiry into this scandal which Lim Kit Siang described thus:
“Up to now, the government has failed to “come clean” on the colossal Bank Negara forex losses as a result of speculation in the international currency markets from 1992-1994, with the losses cited as ranging from RM10 billion to RM30 billion…The reasons which I had advanced in Parliament in 1994 for a Royal Commission of Inquiry into the colossal Bank Negara forex losses remain valid today and should be the terms of reference of a White Paper…
"To determine the actual extent of the colossal forex losses suffered by Bank Negara 1992-1994; whether there had been any financial malpractices and abuses in view of the inconsistencies and conflicting explanations about the colossal forex losses, and establish how Bank Negara could incur such colossal losses.”
I imagine Lim must be so pleased that his call for an RCI in 1994 has finally come to pass. Now at least the Malaysian rakyat will be able to get to the bottom of this seemingly bottomless pit of financial squandering under the Mahathir regime.
When will we see a credible RCI on 1MDB?
Certainly, the rakyat also demands a credible RCI on the 1MDB scandal. Unfortunately, Mahathir was responsible for concentrating so many branches of power under the Executive branch of the Government that the independence of the AG's chambers and the MACC have now been compromised under the Prime Minister’s Department.
Likewise, the Judiciary has not fully recovered from its rude assault by Mahathir after Operation Lalang in 1988 when the Lord President and three Supreme Court judges were sacked. Will it be poetic justice that Mahathir might have to face the judiciary of his own making?
We will have to be patient and wait for the laws of karma to work in such a way that we will also have a credible RCI on the 1MDB scandal. Waiting might have to be until the present prime minister meets his Umno nemesis and becomes the hare in the race. If he then joins the opposition, I wonder if he will be forgiven by the opposition for his 1MDB indiscretions?
Since we have waited more than twenty years for the RCI on the forex losses, let us hope we do not have to wait that long for an RCI on 1MDB!
BN and Harapan's unacceptable tolerance of corruption
By now, it must be clear to all Malaysians that there is a pattern of an unacceptable level of tolerance of corruption within both the BN and Harapan coalitions. If Mahathir had quietly retired, we would definitely not be hearing about this RCI on the forex losses in the nineties. But he has his own agenda and has chosen to challenge Najib, so he will have to face the consequences and bite the bullet while facing the assault from Najib.
Within Harapan, PKR Secretary-general Rafizi Ramli recently exposed corruption involving money and “women” for those wanting to deal with the Selangor government. He similarly made the standard proviso that he “might take action unless…” He said he had received the complaint from a “bona fide person that apart from money, now there are also requests for women when dealing with the state government.
This is not the first time we have witnessed such a tolerance of corruption by Harapan leaders in which the alleged corrupt person involved is given a choice of following a course set out by the accusers in the coalition.
We saw such a strategy at work during the gambit to get rid of the former Menteri Besar of Selangor Khalid Ibrahim when PKR leader Saifuddin Nasution waved a file of alleged corrupt practices over Khalid’s head to force him to step down as MB.
However, since the day Khalid did indeed step down as MB, we have heard nothing more of the alleged corruption scandals on which his removal was apparently based.
Does the former MB not have to face these allegations of corrupt practices anymore and does he not have to accept the consequences if found guilty? Did the taxpayers of Selangor suffer any loss of their state revenue as a result of the alleged wrongdoing?
If so, should he not have to pay these back to Selangor taxpayers? On the other hand, if the alleged corrupt practices are found to be concocted and untenable, do the Harapan leaders who were responsible for such irresponsible ruses (including the frivolous Kajang Move) not have to face the consequences of their actions?
After he stepped down as MB of Selangor, Khalid Ibrahim has insinuated that there are irregularities in the purchase of the water assets by the Selangor government, namely one of the water concessionaires has been offered favourable terms through links to personalities in the Selangor state government. In the interest of Selangor taxpayers, this deal should be investigated by an independent inquiry as well.
Urgent reforms in GE14:
1. Zero tolerance of corruption
So, what does this tell us about the attitude by the Harapan leadership to corruption? They have shown us that they are prepared to tolerate corrupt practices as long as the guilty ones follow the coalition’s wishes. This is totally unacceptable.
In the reformed Malaysia that Malaysians yearn for, there must be zero-tolerance of corruption. We expect every case of corruption to be reported to the relevant authorities including the police for prosecution and nothing less than that.
Corrupt leaders and civil servants have to be accountable to the people. Furthermore, they have to pay back what they have corruptly obtained from the people and atone for their indiscretion. And this is irrespective of whether the amount of money involved is 2.6 billion in your personal bank account or 2.6 million that you paid for a house.
2. Public officials charged with corruption must step down until cleared
In addition, any public official charged with corruption must step down while the case is in the courts as a democratic principle and good governance. This principle is not subject to any populist campaign which claims that “the people say the CM need not resign”. Any guilt over corruption charges can only be decided in the courts and not by selected sections of the public.
If this rule is not followed and if MO1 is finally charged for corruption, this will be a precedent that he can cite to justify staying on in his capacity as MO1.
3. Make our sovereign wealth fund and Bank Negara transparent and accountable
It is not enough for Harapan to tell us the details of the 1MDB scandal and for BN to expose the shenanigans of the Mahathir administration which led to the forex losses. The rakyat wants to know how the BN or the Harapan will ensure these scandals never happen again by putting in place strict reforms to make our sovereign wealth funds and Bank Negara transparent and accountable.
Our sovereign wealth fund and foreign exchange reserves must be managed in a transparent manner for the benefit of Malaysian workers, especially their expectation of a respectable pension when they retire and investment for our future generations. Political objectives and capitalist greed must not influence their management.

We want a standard that ensures that international investments of our government, including foreign exchange reserves, sovereign wealth funds, and government-owned such as pension funds, are based on clearly stated policy objectives and investment strategies, transparent and accountable to the people. The opaque operations of the Malaysian government in managing our international investments is what led to the forex and 1MDB scandals.
We say, ‘Never Again!’
If BN and Harapan want our votes, they must tell us in no uncertain terms how they will ensure that such scandals never happen again and what specific reforms they will put in place to achieve this – namely, how they will consolidate the rule of law and good governance and how they will step up the efforts against corruption and enhance our policy and regulatory frameworks.

KUA KIA SOONG is the adviser of human rights group Suaram. - Mkini

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