Even if debts paid, 1MDB managers accountable for missing money, says Dr M

Former prime minister Tun Dr Mahathir Mohamad says 1Malaysia Development Bhd's (1MDB) management must be held accountable the the missing money. – The Malaysian Insider file pic, May 29, 2015.

Even if strategic investment fund 1Malaysia Development Bhd's (1MDB) debts are fully paid through the sale of its assets, the fund will not be free from the charge that it cannot account for the billions it has lost, Tun Dr Mahathir Mohamad said in his continued criticism of 1MDB.

Writing in his blog today, the former prime minister said given that the money that was supposed to be in tangible form in Singapore could not now be proven, the management of 1MDB must be held responsible for the loss until they can prove that they did not misappropriate the money.

Dr Mahathir had previously accused Datuk Seri Najib Razak of “lying” about the investment redeemed from the Cayman Islands, which the prime minister had said was in cash form in Singapore totalling US$1.103 billion (RM4.08 billion) in March.

Najib, who is also finance minister and chairman of 1MDB's advisory board, said this in a written parliamentary reply to DAP national publicity chief Tony Pua.

1MDB chief executive Arul Kanda Kandasamy had in February vouched that the cash was in the firm's account in BSI Bank when giving an interview with Singapore's Business Times.

But Najib, in another parliamentary written reply last week to "amend" his earlier answer, said the investment redeemed by 1MDB was assets in US dollars for the purpose of balancing its liabilities which were also in US dollars.

Dr Mahathir said today that while it was acceptable for money to be lost through bad investments and management in business, the chief executive and managers would nevertheless be sacked.

He added that in the case where money was lost and the management could not explain where it went and how it went missing, the management would be responsible whether or not there was a bailout or the debts were settled.

"With money claimed to have been invested in the Cayman Islands and despite claims that it had been brought back and is now in Singapore, and the money cannot be demonstrated to be there in tangible form, then management will be held responsible for its loss.

"The assumption must be that management had misappropriated the money unless otherwise proven," Dr Mahathir wrote.

1MDB has debts of some RM42 billion but Putrajaya says its assets of RM51 billion can cover the sum.

- TMI