As I picked up today's theSUN print copy (30sen at newstand is worth all the money from the "poor"selection of MSM mostly BN propaganda papers!), I read wit' JOY the headline in CITIZEN NADESWARAN's column BECAUSE I know what is going to come from whom I deem "THE BOLDEST COMMENTATOR" Of 'em all/awe!
I used the term "Poor" because of all the mainstream English dailies, none of the other papers' columnists has/have the guts to say it as IT IS like Nades, chalking up less than 50% in contents' value when compared wit' NAdes.
ENJOY his thoughts in today's:.......
Citizen Nades - Give us a clearer picture
Posted on 10 April 2016 - 08:51pm
ON THURSDAY, the Public Accounts Committee (PAC)
tabled its report on 1Malaysia Development Berhad (1MDB) sans the
Auditor-General's Report. If you had read all the English newspapers, it
would have left you confused. Because of the "angle" taken by the
various newspapers and news portals, the issue remains murky.
All had a few views in common – the ex-CEO Datuk Shahrol Azral Ibrahim Halmi being the fall guy is one. Another is the view of the deputy PAC chairman that the prime minister is not directly linked with the company's woes. The third was the "offer" by the directors to quit.
"The board has successfully steered 1MDB through a uniquely challenging period and trusts that, with the release of the PAC report, a line has been drawn," the board said in a statement.
Successful? That's debatable. It ought to be said that resigning does not absolve the directors of their duties under the Companies Act.
Some salient points in the PAC report:
» The directors did not approve the transfer of US$700 million to Good Star Limited in 2009. If so, what did they do about such an illegal transfer?
» Ernst & Young and KPMG had been replaced after insisting on seeing documents on some of the sovereign fund's dealings. Why did the directors accede to the termination?
» 1MDB paid RM4.24 billion (about US$1.367 billion) to Aabar Investments PJS Ltd (Aabar Ltd) as security deposits in 2012, without approval of the board of directors. So, why wasn't the CEO asked to explain?
» The board of directors met eight to 16 times a year from 2009 to August 2015 and approved 425 written resolutions in the same period. So, investments running into billions of ringgit were never discussed?
Despite the rosy picture painted by some sections of the media, funds totalling US$5.5 billion could not be tracked by the PAC due to lack of documents. It included claims that US$700 million and US$330 million were misappropriated to Good Star Limited, a company that has no links to the 1MDB-PetroSaudi joint venture in 2009 and 2011 respectively.
The directors are also duty-bound to answer allegations that US$3.51 billion was paid to Aabar Investment PJS Ltd (Aabar Ltd) "in the form of collaterals". The firm was incorporated in the British Virgin Island.
This will give us some clue as to unaccounted monies but 1MDB has refused to hand over bank statements and related documents. Such a refusal only enables taxpayers to draw inferences that the directors have something to hide.
Besides, over the past months, 1MDB had been claiming that assets of US$940 million in "units" had been placed at the BSI Bank in Singapore. The company and its directors could not support its claims with any documentation.
There are many other failures which have to be addressed by the directors – present and past – but each time a report like this is published, some of them go into their cocoons and refuse to speak.
More importantly, will they be made accountable for all that happened under their watch? Will they be sued for failing to carry out their duties – both fiduciary and statutory?
The fiduciary duties of a director are to act bona fide in the interest of a company. Acting bona fide in the interest of a company is to act with good faith for the benefit of the company.
The law dictates that a director is under a duty to ensure that any act he undertakes is with a view to enhancing the interest of the company either by enhancing profits, reducing costs or even positive publicity of the company.
Further, a director must ensure the observance and compliance with all laws, regulations and codes of conduct and best practices.
Readers may remember the Port Klang Free Zone (PKFZ) scandal which made the headlines seven years ago. PKFZ was set up under the auspices of the Port Klang Authority (PKA). In both PKFZ and 1MDB, there is a common thread – since it is government-owned the shareholders of these establishments are the taxpayers, the citizens of this country.
Loans were taken by both establishments with guarantees or letters of comfort from the government. More importantly, the members of both the boards were appointed by the government.
An independent report by PricewaterhouseCoopers (PwC) had identified 26 directors whose dereliction of duty was a contributory factor in the PKFZ debacle which has cost taxpayers a whopping RM12.4 billion.
The publication of the PAC report should not be seen as the end of what has been touted as the country's "biggest financial scandal". We cannot close the file and "put it behind us and move on" as some members of the Cabinet have suggested.
How can we move on when so much money is still unaccounted for? How can the issue be closed when details of several transactions have been hidden from the auditor-general and the PAC? There are far too many unanswered questions in the report and hence, it must be emphasised that it cannot be the end of this saga.
Getting the government to alienate the land at "cheap sale" prices and then re-selling it at market prices may make the books look good. However, in reality, the government could have sold the land via open tender which would have enhanced its coffers instead of selling it through 1MDB.
So many questions remain unanswered; so many so-called deals were made without proper studies and assessment; the management seems to have defied the directors; and certain individuals made fortunes for themselves.
If anything at all, this 1MDB epic sends home one clear message – the directors had no control or lost control over the funds and the management of the company for reasons better known to themselves.
The government has this propensity to appoint retired civil servants, politicians and candidates defeated in the elections as directors of statutory bodies, government-owned and government-linked companies. This appears to be a way of monetarily rewarding them for their "past contributions".
However, how many of these have the knowledge and skills of what is required to ensure these entities are being run in a manner beneficial to all – the government and the taxpayers?
Both the 1MDB and PKFZ reports found that the board members were toothless tigers who watched with folded arms as the abuse continued right under their noses.
Shouldn't we learn from past mistakes and stop this travesty of appointing individuals who have little or no experience in such matters? In the meantime, why not compel 1MDB to produce the statements on its overseas transactions to satisfy the self-claimed notorious notion that "semuanya OK"?
Please give us a clearer picture instead of the shadowy answers that the PAC report has provided. Surely, taxpayers deserve more.
R. Nadeswaran believes that just like the PKFZ saga, there will be no outcome in the 1MDB case for which the taxpayers will have to underwrite the momentous losses. Comments: citizen-nades@thesundaily.com
All had a few views in common – the ex-CEO Datuk Shahrol Azral Ibrahim Halmi being the fall guy is one. Another is the view of the deputy PAC chairman that the prime minister is not directly linked with the company's woes. The third was the "offer" by the directors to quit.
"The board has successfully steered 1MDB through a uniquely challenging period and trusts that, with the release of the PAC report, a line has been drawn," the board said in a statement.
Successful? That's debatable. It ought to be said that resigning does not absolve the directors of their duties under the Companies Act.
Some salient points in the PAC report:
» The directors did not approve the transfer of US$700 million to Good Star Limited in 2009. If so, what did they do about such an illegal transfer?
» Ernst & Young and KPMG had been replaced after insisting on seeing documents on some of the sovereign fund's dealings. Why did the directors accede to the termination?
» 1MDB paid RM4.24 billion (about US$1.367 billion) to Aabar Investments PJS Ltd (Aabar Ltd) as security deposits in 2012, without approval of the board of directors. So, why wasn't the CEO asked to explain?
» The board of directors met eight to 16 times a year from 2009 to August 2015 and approved 425 written resolutions in the same period. So, investments running into billions of ringgit were never discussed?
Despite the rosy picture painted by some sections of the media, funds totalling US$5.5 billion could not be tracked by the PAC due to lack of documents. It included claims that US$700 million and US$330 million were misappropriated to Good Star Limited, a company that has no links to the 1MDB-PetroSaudi joint venture in 2009 and 2011 respectively.
The directors are also duty-bound to answer allegations that US$3.51 billion was paid to Aabar Investment PJS Ltd (Aabar Ltd) "in the form of collaterals". The firm was incorporated in the British Virgin Island.
This will give us some clue as to unaccounted monies but 1MDB has refused to hand over bank statements and related documents. Such a refusal only enables taxpayers to draw inferences that the directors have something to hide.
Besides, over the past months, 1MDB had been claiming that assets of US$940 million in "units" had been placed at the BSI Bank in Singapore. The company and its directors could not support its claims with any documentation.
There are many other failures which have to be addressed by the directors – present and past – but each time a report like this is published, some of them go into their cocoons and refuse to speak.
More importantly, will they be made accountable for all that happened under their watch? Will they be sued for failing to carry out their duties – both fiduciary and statutory?
The fiduciary duties of a director are to act bona fide in the interest of a company. Acting bona fide in the interest of a company is to act with good faith for the benefit of the company.
The law dictates that a director is under a duty to ensure that any act he undertakes is with a view to enhancing the interest of the company either by enhancing profits, reducing costs or even positive publicity of the company.
Further, a director must ensure the observance and compliance with all laws, regulations and codes of conduct and best practices.
Readers may remember the Port Klang Free Zone (PKFZ) scandal which made the headlines seven years ago. PKFZ was set up under the auspices of the Port Klang Authority (PKA). In both PKFZ and 1MDB, there is a common thread – since it is government-owned the shareholders of these establishments are the taxpayers, the citizens of this country.
Loans were taken by both establishments with guarantees or letters of comfort from the government. More importantly, the members of both the boards were appointed by the government.
An independent report by PricewaterhouseCoopers (PwC) had identified 26 directors whose dereliction of duty was a contributory factor in the PKFZ debacle which has cost taxpayers a whopping RM12.4 billion.
The publication of the PAC report should not be seen as the end of what has been touted as the country's "biggest financial scandal". We cannot close the file and "put it behind us and move on" as some members of the Cabinet have suggested.
How can we move on when so much money is still unaccounted for? How can the issue be closed when details of several transactions have been hidden from the auditor-general and the PAC? There are far too many unanswered questions in the report and hence, it must be emphasised that it cannot be the end of this saga.
Getting the government to alienate the land at "cheap sale" prices and then re-selling it at market prices may make the books look good. However, in reality, the government could have sold the land via open tender which would have enhanced its coffers instead of selling it through 1MDB.
So many questions remain unanswered; so many so-called deals were made without proper studies and assessment; the management seems to have defied the directors; and certain individuals made fortunes for themselves.
If anything at all, this 1MDB epic sends home one clear message – the directors had no control or lost control over the funds and the management of the company for reasons better known to themselves.
The government has this propensity to appoint retired civil servants, politicians and candidates defeated in the elections as directors of statutory bodies, government-owned and government-linked companies. This appears to be a way of monetarily rewarding them for their "past contributions".
However, how many of these have the knowledge and skills of what is required to ensure these entities are being run in a manner beneficial to all – the government and the taxpayers?
Both the 1MDB and PKFZ reports found that the board members were toothless tigers who watched with folded arms as the abuse continued right under their noses.
Shouldn't we learn from past mistakes and stop this travesty of appointing individuals who have little or no experience in such matters? In the meantime, why not compel 1MDB to produce the statements on its overseas transactions to satisfy the self-claimed notorious notion that "semuanya OK"?
Please give us a clearer picture instead of the shadowy answers that the PAC report has provided. Surely, taxpayers deserve more.
R. Nadeswaran believes that just like the PKFZ saga, there will be no outcome in the 1MDB case for which the taxpayers will have to underwrite the momentous losses. Comments: citizen-nades@thesundaily.com
*********************************************************
AND from the horse's mouth of the ex-BOSS of 1MDB who was made the CHIEF SCAPEGOAT by the PAC REPORT-- yes, the proverbial sacrificial lamb! -- in a rebuttal news report from theSUN; DEsi C&P from the ONline edition:~~~
US$1bil deal done with proper approval: Ex CEO
Posted on 10 April 2016 - 10:39pm
Last updated on 11 April 2016 - 12:10pm
Last updated on 11 April 2016 - 12:10pm
"He signed the document, so that means that he is aware," former 1MDB chief executive officer Datuk Shahrol Azral Ibrahim Halmi (pix) had testified at a Public Accounts Committee (PAC) hearing on Nov 25 last year.
According to recently released transcripts of the Hansard recording of the the PAC proceeding, Shahrol had told the committee that 1MDB had had obtained both shareholders' and Board of Directors approval for the deal, which had been inked by the Prime Minister as per required under 1MDB's Memorandum & Articles of Association (M&A).
According to Article 117 (c) of the M&A, any financial commitment (including investment), restructuring or any other matter which is likely to affect the guarantee given by the Federal Government for the benefit of the company, the national interest, national security or any policy of the government, has to get a written approval from the prime minister.
"There was a very robust discussion on how the joint venture was eventually carried out. "But I would like to reiterate that actually the agreement was tabled and it was approved by the Board and that was what we, the management, took as the authority to go and finalise the agreement," he said in the hansard recording, when questioned by PAC member William Leong Jee Keen and Tony Pua Kiam Wee.
PAC, in its 106-page report on its findings on 1MDB's governance and management control tabled in the Dewan Rakyat last Thursday, stated it found that the US$1 billion joint venture deal had been done without due diligence.
"The US$1 billon investment by 1MDB in this joint venture was done without a due-diligence process; there are no specific details on the project stated on the proposal paper that was prepared by the management and no feasibility study was done on the investment project that would be carried out," the PAC report said.
The PAC had found that the Board of directors had failed in their duty to protect the company and its shareholders, and held Shahrol Azral responsible for weaknesses in the company's management.
It also called for the relevant authority to investigate Shahrol and other relevant management officials.
According to the handsard, in the same proceeding, Pua had questioned the involvement of businessman Low Taek Jho in the joint venture, to which Shahrol told the committee that Low had introduced PetroSaudi Ltd individuals to the 1MDB.
"He had introduced individuals in there to us but no further role than that," he said, adding that the individual concerned was PetroSaudi Ltd executive Tarek Obaid.
Queried on the fact that Low's name was shown in the minutes as having sat in the board meeting which decided on the joint venture with PetroSaudi, Shahrol explained that Low was an adviser in Terengganu Investment Authority (TIA) which was later renamed 1MDB, until May 2009.
"Yes. At that time, as I remember, the Board invited Prince Turki (Abdullah Al Saud) but (he) sent his apology and asked Low to go and represent and answer any questions, but I do not believe Low (stayed) for the deliberation and for the entire meeting," he said.
"I do not think that Low was given like power to decide 'Yes' or 'No'. I think he was asked to be there to just answer any questions," he added.
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