Wednesday, March 15, 2017

Finance Minister’s convoluted answer on MoF takeover of 1MDB’s real estate assets was a blatant attempt to mask at least a RM3.2 billion bailout

I had submitted a question last week to the Finance Minister, Dato’ Seri Najib Razak which only required a simple straightforward, possibly 2-sentence answer.  I have asked the Finance Minister to “list the 1MDB real estate assets taken over by the Ministry of Finance (MoF) and the consideration paid for them”.

More importantly, I asked “did MoF take over the borrowings associated with these assets including, the RM800 million from SOCSO and RM2.4 billion in sukuk bonds”.  This question only required a simple “yes or no” reply, with the total borrowings assumed by the MoF, if any.

What I received was a long grandmother story which tried to obviously obfuscate the answer.

The Finance Minister tried to pin the blame or responsibility for the take over of assets on the Public Accounts Committee (PAC).  The PAC had indeed recommended that the MoF takeover these assets and I have no problems with that.
Anak-anak syarikat dan aset milik kumpulan 1MDB (TRX, Bandar Malaysia, tanah Air Itam, tanah Pulau Indah) seharusnya diserahkan kepada MKD, supaya dapat dikawal selia dan diuruskan dengan lebih rapi dan teliti. (pg 106)

To the second part of my question, again he shifted to responsibility to the PAC by quoting page 81 of the PAC report which stated that
…pinjaman SOCSO sebanyak RM800 juta oleh TRX City Sdn Bhd dan sukuk sebanyak RM2.4 bilion oleh Bandar Malaysia Sdn Bhd akan diuruskan, di mana ia akan kekal ditanggung oleh aliran tunai projek TRX dan projek Bandar Malaysia.

That was a most blatant slight of hand, and I actually had to double-check my own copy of the PAC Report because I didn’t recall any such recommendations. My memory certainly did not fail me because the statement on pg 81 was actually the proposal submitted by 1MDB to the PAC and not, a recommendation by the PAC!


However, while Dato’ Seri Najib Razak did not explicitly say “yes” or “no” to the above question, it is now clear as day that the MoF has effectively bailed out 1MDB to the tune of RM3.2 billion by taking over these debts!

It also meant that the Second Finance Minister, Dato’ Seri Abdul Johari Ghani’s prior insistence to the media that there was no taking over of 1MDB debts planned over the assets takeover was a blatant lie.

Malaysians are being raped two-times over the above transaction because these pieces of land were “sold” to 1MDB by the MoF at bargain basement prices.  The land for the 70-acre TRX was priced at RM64 per square feet (psf) for a total of RM194 million, while the 486-acre Bandar Malaysia was at RM72psf for a total of RM1.67 billion.

However, 1MDB has already sold parts of TRX to Tabung Haji and Armed Forces Pension Fund-owned Affin Bank for more than RM2,700 and RM4,500psf.  In total, 30.5 acre of TRX was sold for approximately RM3.5 billion.  At the same time 40% of Bandar Malaysia has been sold for more than RM1,000psf.  The proceeds of these sale has already gone into the pockets of 1MDB to service its mountain of debt unrelated to its property division.

Hence we were screwed first time when we practically gave the super-prime land to 1MDB for free, allowing 1MDB to blindly profit for billions of ringgit.  We are now screwed the second time, when MoF takes back the balance of the assets from 1MDB, now attached with a mega RM3.2 billion debt.

Malaysians can now understand why former Second Finance Minister, Dato’ Seri Husni Hanadzlah decided to quit the Cabinet.  The brazen bailout horrors which are taking place today are just mind-blowing – and the above refers only to the real estate transactions.

No Minister with an iota of integrity or credibility would want to remain in this Cabinet, bent on using billions of ringgit of tax-payers’ money to cover up the single largest kleptocratic crime by the Najib administration.
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