Press statement by Kua Kia Soong, SUARAM Adviser, 16 May 2018

It is gratifying to see the speed in which the 1MDB probe is being conducted and the pledge by the new Prime Minister that the rule of law will be the new mantra and will apply to all and sundry.

Even before this historical denouement, the two political coalitions in the country had been forced through their grandstanding to call for Royal Commissions of Inquiry (RCIs) into three of the worst financial scandals in recent Malaysian history. Pakatan Harapan had of course been calling for an RCI into the most recent 1MDB scandal that has made international headlines. That has already been overtaken by the alacrity of the new administration to bring those responsible to book.

We would echo the call by former Federal Court Judge Gopal Sri Ram for the government to probe the Scorpene submarine deal in which the former premier Najib Abdul Razak’s and his close associate, Abdul Razak Baginda were involved. In this scandal not only were huge commissions involved but a hapless Mongolian lass was brutally murdered. Although two former bodyguards of the former PM have been charged and sentenced, the motive for the murder has to be probed in a re-trial and the corrupt brought to book.

Set up truly independent Royal Commissions of Inquiry

Since Malaysians have been celebrating the end of 61 years of BN misrule and tyranny, it is only right and expected that the rule of law should apply to all the financial scandals during these 61 years from the relatively recent forex losses to the BMF scandal in 1984. These multi-billion financial losses have not been accounted for and the negligent and corrupt leaders brought to account. In these scandals, since the present PM was involved, it is only appropriate that a Royal Commission of Inquiry (or more Commissions if need be) be set up made up of truly independent persons. Only then can we say that the rule of law applies to all and sundry in Malaysia.

Just as the previous PM tried to get away with impunity by compromising our democratic institutions, the new PH Government must ensure that no leader should be allowed to get away with impunity for any transgressions against accountability and loss of the national coffers.

Political scientists Milne & Mauzy commented that Malaysia’s financial scandals “reached endemic proportions” in the mid-80s. Barry Wain, author of ‘Malaysian Maverick’ reckons that close to RM100 billion were squandered between 1981 to 2003.

Sixty one years of impunity

One of the first scandals in the 80s was what Lim Kit Siang called the RM2.5 billion “scandal of scandals” when Bumiputra Malaysia Finance, a Hong Kong based subsidiary of state-owned Bank Bumiputra Malaysia Berhad, was found to have engaged in a wide range of shady dealings involving the Carrian Group. The sordid details included the murder of a BBMB auditor Jalil Ibrahim, who was sent to conduct an audit of BMF Hong Kong in 1983. No RCI has thoroughly investigated this scandal to see who in Kuala Lumpur had authorized those shady deals and recommended the appropriate charges against those responsible for this massive financial scandal.

Then there were the more than $600 million losses suffered by the country over the Maminco-Makuwasa tin caper on 19 Nov 1986 when there was the attempt to corner the international tin market in 1981. Was it a Cabinet decision? An RCI must uncover the circumstances surrounding this covert operation which resulted not only in huge losses for the nation but the end of our erstwhile tin industry.

And who can forget Lim’s denunciation of Mahathir’s “piratisation” of the North-South Highway in 1987? The North-South Expressway was privatised to the United Engineers Malaysia (UEM) and there were improprieties in the tender exercise, conflict of interest, lack of accountability and transparency.

In August 1997, 15 NGOs including Aliran, AWAM, FOMCA, ERA, SUARAM and Tenaganita submitted a memorandum to the Anti-Corruption Agency asking for swift investigations concerning nepotism by various noted personalities, including the children of the Prime Minister and an accompanying document containing lists of private limited companies where three children of the Prime Minister – Mirzan, Mokhzani and Mukhriz Mahathir – acted as directors. According to searches made at the Registry of Companies at the end of 1994, Mirzan had interests in 98 companies, Mokhzani in 48 companies and Mukhriz in 67 companies. They wanted to know whether there was any nepotism in the government, through Petronas by using hundreds of millions of ringgit of public funds to bail out Mirzan Mahathir’s Konsortium Perkapalan Bhd.

Cronies were bailed out after the 1997 financial crisis requiring repeated billion-ringgit bailouts at the public taxpayers’ expense especially that of the national airline in the government’s  buyback bailout of Tajudin’s MAS stake at taxpayers’ expence. The RM10.5 billion bailout of Renong was another government bail-out of politically well-connected companies. At the end of 1998, Malaysian taxpayers were burdened with Perwaja’s RM9.1 billion liabilities. Accumulated losses and liabilities reached over RM10 billion.

The recently concluded RCI report into the colossal forex losses as a result of speculation by Bank Negara in the international currency markets from 1992-1994, with the losses cited as ranging from RM10 billion to RM30 billion must be made public. We can then determine the actual extent of the colossal forex losses and whether there had been any financial malpractices and abuses by then Prime Minister, Finance Minister and Bank Negara Governor in view of the inconsistencies and conflicting explanations about the colossal forex losses. The RCI should recommend the appropriate charges for those who abused their powers.

An RCI or RCIs must re-open the books on all the financial scandals since the eighties that have cost the rakyat so many billions of ringgit. For human rights defenders who demand social justice, democracy and human rights, there is no place for impunity. Impunity means “exemption from punishment or loss or escape from fines”. It refers to the failure to bring perpetrators of human rights violations, rule of law flouters and the corrupt to justice and constitutes a denial of the victims’ right to justice and redress. Impunity is especially common in countries that do not respect the rule of law, that suffer from corruption and have entrenched systems of patronage, or where the judiciary is weak and the security forces are protected by the powers-that-be.

The First Principle of the Protection and Promotion of Human Rights through Action to Combat Impunity, submitted to the United Nations Commission on Human Rights on 8 February 2005 states that:

“Impunity arises from a failure by States to meet their obligations to investigate violations; to take appropriate measures in respect of the perpetrators, particularly in the area of justice, by ensuring that those suspected of criminal responsibility are prosecuted, tried and duly punished; to provide victims with effective remedies and to ensure that they receive reparation for the injuries suffered; to ensure the inalienable right to know the truth about violations; and to take other necessary steps to prevent a recurrence of violations.”

In our new democracy after the peoples’ vote in GE14, impunity must not be allowed to be entrenched in this country. We welcome the pledge by the new PM that the rule of law must prevail throughout…

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