Investigate 1MDB disclosures comprehensively and with integrity

– Steven Thiru
The Malaysian Insider
8 July 2015

The Malaysian Bar is extremely concerned over recent disclosures made by The Wall Street Journal (WSJ) and Sarawak Report (SR) of information contained in government investigation documents allegedly revealing that funds of about US$700 million (RM2.7 billion) were transferred between government agencies, banks and companies linked to 1Malaysia Development Berhad (1MDB), and then deposited into the personal accounts of the Prime Minister in AmIslamic Bank Berhad in March 2013.

It has also been reported that the original source of the funds is unclear and the subsequent use of the funds is unknown.

The prime minister said today, “… saya ingin menegaskan sekali lagi bahawa saya tidak pernah mengambil dana 1MDB untuk kepentingan diri sendiri” (I would like to stress again that I had never taken 1MDB’s funds for my personal interest).

However, it appears that the prime minister has not expressly denied that funds were deposited into his personal bank accounts.

The disclosures made by WSJ and SR are exceptionally grave, and must be probed exhaustively, and without delay.

The basic questions that arise, and remain unanswered, are whether the funds were transferred to the prime minister’s bank accounts, and whether these bank accounts were his personal bank accounts.

If so, further questions arise, including the source of the funds; the prime minister’s relationship with the depositors of the funds; the reason they chose to deposit the funds into his personal bank accounts; and the purpose for which the funds were utilised, or the identity of the ultimate beneficiaries of the funds.

There must be clear, convincing and irrefutable answers to all these critical questions in order to determine the nature and extent of any criminal culpability.

Further, if the transmission of the funds occurred as reported by WSJ and SR, questions would need to be asked as to the application of exchange control regulations and anti-money laundering legislation.

In this regard, it would be pertinent and vital to know whether Bank Negara Malaysia (BNM) had been notified of the remittance of these funds by the paying and receiving banks, and what actions, if any, were taken by BNM in response.

The Malaysian Bar notes that a multi-agency task force (Special Task Force) has been set up to investigate all of these matters, consisting of Tan Sri Abdul Gani Patail, the Attorney-General of Malaysia; Tan Sri Dato’ Sri Dr Zeti Akhtar Aziz, the Governor of BNM; Tan Sri Khalid Abu Bakar, the Inspector General of Police; and Tan Sri Abu Kassim bin Mohamed, the Chief Commissioner of the Malaysian Anti-Corruption Commission (MACC).

It has been reported that, as a first step, an order to freeze six bank accounts of the parties suspected to be involved with the case was issued on 6 July 2015.

In addition, the Special Task Force has seized documents relating to 17 accounts from two banks to facilitate the investigation.

The Special Task Force has also seized documents pertaining to non-compliance of BNM’s rules and procedures by the banks involved.

The Special Task Force must conduct a comprehensive, detailed and unfettered investigation into the allegations made by the WSJ and SR, and any other credible reports that might come to the fore.

No stone should be left unturned, and no questions left unanswered. The investigation must also be transparent in that members of the public must be kept regularly informed of its progress.

The findings and conclusions of the Special Task Force must be substantiated and incontrovertible, and withstand scrutiny. Anything less will result in accusations of there having been a cover-up or whitewash.

Further, the Special Task Force must not only be independent, but must be seen to be independent, in discharging its functions.

The various agencies must carry out their duties without any direct or indirect interference or influence by any party, including the prime minister himself.

The scope of their investigation must be as wide as possible, and no one should dictate or limit their ambit.

As the Attorney-General is the chief legal adviser to the government, the MACC comes under the purview of the Prime Minister’s Department, and BNM falls under the portfolio of the minister of finance (who is the prime minister), it is wholly unacceptable and untenable for the Prime Minister to continue in office while the investigation is in progress.

In order therefore to safeguard the independence of the Special Task Force, and to preserve the integrity and sanctity of the investigation, it would be clearly necessary for the prime minister to take a leave of absence pending the outcome of the investigation.

This would dispel any perception of interference or influence. Any leave of absence that the prime minister takes should, however, not be seen or construed as a pre-determination of guilt, but rather as a prudent and scrupulous step in enhancing the credibility of the investigation into these allegations.

The Malaysian Bar urges the prime minister to act responsibly and conscientiously in upholding the personal trust vested in him, and the public confidence reposed in his office. – July 8, 2015.

*Steven Thiru is the president of The Malaysian Bar.

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