The Malaysian official reaction this weekend to the HUGE INTERNATIONAL STORY of further namings and shamings by the DOJ over 1MDB was….. muted.
Whilst the rest of the world media wallowed in the news that super-models, super-stars, super-yachts and super-datins had been caught up in an orgy of embarrassment and confiscation orders, Malaysia’s licenced media shuffled its feet and looked awkward, just like the majority of its UMNO bosses.
The New Straits Times, for example, contacted Sarawak Report for comment on what appears to have been the only reference to the entire mega-scandal carried by the paper. This ‘story’ was that Malaysia’s ludicrous fugitive blogger RPK had accused us of being in “cahoots” with the CIA and had claimed we were behind the DOJ court order, carefully timed, he alleged, to scotch Najib’s possible election plans for the summer (Najib, please don’t wait a second longer – hold your election NOW).
NST readers (if there are any) must have been puzzled by the story (known as a distraction in the business) given that RPK’s flights of fancy were not backed by any evidence or reporting by the paper on the events he was responding to. What agony it must be for all Malaysia’s mainstream journalists, who have been forced to sit on the sidelines, whilst the biggest, juiciest story in their country’s history is being written up by their colleagues online or foreigners abroad.
Likewise, UMNO’s politicians have by and large discovered that discretion is the better part of valour when it comes to attempting to defend the indefensible. After all, anyone objectively reading the DOJ’s tour-de-force investigation can come to only one conclusion, which is that Najib is either spoon-fed stupid or the boss of a ruthless, criminal enterprise, which has grasped control of all Malaysia’s political and economic levers.
In fact, there is a third more likely probability, which is that he is both. No gangster in history has got away with such clumsy ineptitude for so long. For that he and his proxy Jho Low can at least be congratulated and it is all documented in toe-curling detail with plenty of touches of human interest in the DOJ’s page-turner of a report.
The US investigators corroborate Sarawak Report’s earlier reporting that this whole episode of epic Bonnie & Clyde proportions (the nickname given to Najib and Rosmah by members of their inner circle) began on the yacht Tatoosh in the waters off Monaco in August 2009.
Here, together with Jho Low and the young Saudi directors of the fledgling company PetroSaudi, Malaysia’s ‘First Couple’ cooked up a plan to steal a billion dollars – or, if you prefer, stupid Najib and Rosmah were misled by their wiley underlings.
This was just the first of several billion filched through the guise of 1MDB, of course. The FBI investigators have upped their calculations on the extent of the stolen loot to at least $4.5 billion in their latest report and they have slapped orders for the return of $1.7 billion in the form of assets.
The DOJ reveals how Jho (then Najib’s advisor at 1MDB) emailed his parents, brother and sister following that yacht party on September 7th to say:
“Just closed the deal with petrosaudi. Looks like we may have hit a goldmin[e].”
According to the PetroSaudi data obtained by Sarawak Report, September 7th was the very day Jho Low met PetroSaudi’s British Investment Manager, Patrick Mahony, in New York at the request of PetroSaudi Director, Tarek Obaid, to follow up on those discussions on the yacht:
So, what the DOJ confirms is that from the very start this was a criminal enterprise to make huge amounts of money for this circle of conspirators, which included Jho Low, PetroSaudi’s Tarek Obaid, Aabar’s Khadem Al Qubaisi and Mohammed Al Husseiny, along with a string of top officials at 1MDB who were themselves paid off – Casey Tang and Jasmine Loo both received $5 million in pay offs according to the court filing.
The biggest beneficiaries of the stolen money, however, were Najib himself, his wife and son, closely followed of course by Jho Low, KAQ, Obaid and Husseiny. It’s all there in searing detail in the scrupulously documented money trails laid out by the DOJ.
Time and again, the US investigators point to blatant inconsistencies between what these crooked collaborators said to different parties about the same transactions – evidence of a deliberate intent to deceive.
You could, if you wish, choose to believe that the head of all this double-dealing, the sole signatory of 1MDB, Finance Minister Najib Razak was merely an ignorant pawn, gulled by his advisors into imagining that more than a billion dollars that poured into his KL accounts came from an anonymous Saudi royal, impressed with his efforts to build ‘moderate Islam’.
In which case this, dim-witted leader and his step-son are still failing to understand the glaring discrepancy between Najib continuing to insist that money paid to the bogus Aabar PJS Limited BVI was thereby legitimately returned to a subsidiary of the Abu Dhabi sovereign wealth fund and what his step-son Riza Aziz has been saying to his tax inspectors.
Najib still maintains that Aabar PJS Limited BVI is a genuine subsidiary of the Aabar/IPIC Abu Dhabi state owned sovereign wealth fund. Yet what Riza told the US tax man (backed up by one of Jho Low’s comical letters) was that Aabar PJS Limited BVI was personally owned by his family friend Mohammed Al Husseiny, who had decided to gift him a couple of hundred million as a private favour. As the DOJ puts it:
“The fact that Aabar-BVI purportedly gifted approximately $94 million to AZIZ on the basis of “disinterested generosity” and the “close personal relationship” between AZIZ and HUSSEINY further demonstrates that Aabar-BVI was not operating as a legitimate subsidiary of Aabar or IPIC and that the funds held in the Swiss Aabar- BVI account were not being held for the benefit of 1MDB, Aabar, or IPIC.”
So, either this family is indeed extremely thick or they are lying crooks – whichever, Najib should probably not still be in office in charge of Malaysia’s money.
The same DOJ document details several more discrepancies of a similar nature, where the managers of 1MDB blatantly told one story to one party and then another story to someone else, with a clear intent to deceive and siphon out money from the fund.
As DAP’s Tony Pua has already highlighted, these fund managers even issued different documents for different eyes for the same transactions. How could such con-artist tactics be construed as innocent?
For example, in 2014 1MDB set about raising a billion dollar loan from Deutsche Bank, supposedly to settle outstanding options and guarantees owed to Aabar, in advance of launching the planned floation of the fund.
The DOJ makes plain that in applying for that loan 1MDB top officials did not inform the bank that some $1.4 billion had already long before been paid to (the bogus) Aabar PJS Investments BVI, for the expressed same purpose, shortly after the original bonds had been raised in 2012:
1MDB officials did not make compliance and risk officers at Deutsche Bank aware that 1MEHL had given Aabar-BVI close to $1.4 billion in proceeds from the 2012 bonds, purportedly pursuant to an alternate version of the Option Agreements that also included a provision for the payment of a cash contribution to Aabar-BVI. [highlighting added]
An issue then arose when instructions were then given to BSI to pass on $175 million of that money from Deutsche Bank to the bogus Aabar BVI:
Because of the size of the transfer from 1MEHL to Aabar-BVI, BSI Bank required an explanation in order to process the incoming wire. QUBAISI and/or HUSSEINY represented to BSI Bank that the $175 million wire transfer represented partial payment by 1MEHL to buy back the Aabar options. BSI was provided with a copy of an “Agreement Related to Option Agreements,” dated April 28, 2014, which purported to set forth the terms of the options buyback arrangement. That agreement (hereinafter, the “BSI Buyback Agreement”) provided that “Aabar Investments PJS Limited,” a U.A.E. company, would assign its rights to the Aabar options to 1MEHL in exchange for $989,000,000, of which $175,000,000 was payable within 30 days of the date of the agreement. The agreement bore the signature of QUBAISI and the then-CEO of 1MDB.
In fact, most of that $175,000 went to settle the final payments on Jho Low’s newly purchased super-yacht, says the DOJ and also to pay Jasmine Loo and Najib some money also. However, the detail on the agreement shown to BSI conflicted with parallel documents provided by 1MDB managers to their accountants:
394. The terms of the BSI Buyback Agreement were materially inconsistent with the terms of the May 22, 2014 Settlement Agreement referenced in 1MDB’s audited financial statements. As explained above in Paragraph 383, that Settlement Agreement – dated after the date of the BSI Buyback Agreement – provided that the cash consideration to be given to Aabar for termination of the options had not yet been determined.
395. As set forth below, the loan proceeds transferred to the Aabar-BVI Swiss Account were used for the benefit of LOW, LOO, and MALAYSIAN OFFICIAL 1, rather than for the benefit of 1MDB, IPIC, or Aabar. These uses were inconsistent with the purpose of the loan, which 1MDB was obligated to repay.
There are plenty of other instances identified by the DOJ of deliberately inconsistent documents provided by 1MDB management to extract money from banks and then square it with their accountants, for which there can be no possible legitimate explanation.
For example, there were two versions of the company’s financial statements in 2014, one provided to the bank and the other to the auditors, with regard to what was done with the $2.3 billion which 1MDB allegedly ‘redeemed’ from its bogus Cayman Island Fund (set up in the wake of the original PetroSaudi joint venture, from which all the money was actually stolen).
462. The version of the financial statements that 1MDB OFFICER 4 provided to Deutsche Bank indicated that this “redeemed” cash had been “substantially set-aside for the purposes of debt interest payment, working capital purposes and payments to Aabar as refundable deposits pursuant to a Settlement Agreement to extinguish the Options Agreements.” This disclosure was consistent with the notion that Brazen Sky had retained the cash it had “redeemed” from the Bridge Global Fund rather than sending it forward to 1MDB Global and Aabar-Seychelles. It was also consistent with the fraudulent bank statements for the Brazen Sky Account that 1MDB OFFICER 4 had provided Deutsche Bank for the months of November and December.
463. In contrast, 1MDB’s publicly-filed financial statements indicated that the cash supposedly received from liquidation of fund units had been “substantially utilised for the purposes of debt interest payment, working capital and payments to Aabar as refundable deposits pursuant to a Settlement Agreement to extinguish the Options Agreements.” This statement suggested that the cash in the Brazen Sky Account had been spent or otherwise dissipated, as in fact was the case, notwithstanding Deutsche Bank’s right to a charge on the account.
464. This discrepancy was never fully resolved because 1MDB defaulted on the $975 million loan with Deutsche Bank….
‘Set aside‘ means kept as collateral in the bank and ‘utilised‘ means spent. If anyone imagines that senior fund managers could have presented two such different versions by accident (rather than in order to get Deutsche Bank to loan the money, whilst explaining to the auditors why it could no longer be located) then the reference to the fact that the senior financial officer also concocted “fraudulent bank statements” settles the matter.
Senior management at 1MDB had evidently been dragged into a pattern of deliberate and orchestrated financial fraud and deception on a gigantic scale…. and they were being rewarded with secret multi-million dollar payments in the process. Most of the stolen money, the DOJ makes clear, was being forwarded to Najib, Jho Low, Riza and Rosmah along with their collaborators at PetroSaudi and Aabar.
Again, whether this is because Malaysia’s first couple should be considered completely stupid, thinking that money can be grown on trees, as long as they sign what their juniors tell them, is for Malaysians to decide.
Meanwhile, a handful of Malaysia’s own brand of ‘Comical Alis’ have popped up to ‘defend’ Najib from the devastating implications of the FBI’s latest evdence before the US courts.
The official responses by the main protagonists in Malaysia to the devastating development have been notably short and vague, in contrast to the detailed evidence backed by banks, which was presented by the DOJ.
Jho Low mumbled through a PR agency that the details were “inappropriate” (what does that make his own behaviour?). The Attorney General complained he hadn’t been consulted (pretty bare-faced after the Swiss complained about his year of refusal to answer mutual cooperation requests). Whilst the PMO’s Office hinted at dark but unspecified political motivations on the part of America.
Yet, if the DOJ was lying then the string of international bank cited in the filing would possibly have denied the accusations involving them? Instead, over the past several months they have cooperated, paid their fines and surrendered several employees to investigation and in some cases incarceration in Singapore…. with other cases still on-going.
But, in Malaysia the denials continue. Just like Comical Ali, the feisty guy who continued to champion the doomed Sadam regime on all the world’s TV screens as the smoke poured from the skys and the drone of US bombers filled the air around him, BN’s own Comical were in lonely action over the weekend – speaking up for various reasons in defence of the ‘innocent’ and ‘invincible’ Najib.
Of these the latest to provide everyone a laugh in the midst of desperation was his own cousin, the Defence Minister Hishamuddin, recently put forward as Najib’s safest bet for a replacement if the going gets too tough.
Hishamuddin needs to prove his loyalty to keep Najib’s confidence – after all, part of that handover arrangement would, of course, involve immunity. Thus Hisahmuddin today “dared” the supposedly timorous United States to “press charges” and to ‘name MO1 and his wife’ (even though colleagues have already done it and the DOJ spells it out like A,B,C).
Unless, the DOJ presses charges it will damage its own credibility, barks Hishamuddin from the shredded battlements of UMNO’s own crumbling reputation. He is unlikely to have to wait long for a positive answer, which should provide a whole load more laughs from the various onlookers.
Also loudly defending Najib was the PM’s other most predictable champion, the ever vocal Nazri. At last Nazri gave a reason for his blind loyalty to his boss – he said it was ‘friendship’. Nazri took up the theme of a mysterious ‘political agenda’ by the US against Malaysia:
“It was all a political ploy meant to destabilise Malaysia…Nazri said the US was bent on undermining Malaysia through the DoJ suit…In an interview with The Malaysian Insight on the sidelines of the Dewan Rakyat sitting, Nazri said these were the points that he would have made if the debate with former prime minister Dr Mahathir Mohamad had taken place tomorrow.
That should provide laughs all round, since the Minister was of course referring to the supposed debate he pretends he would dare to have on the subject of 1MDB with the deadly critic Dr Mahathir (former PM of twenty years) if only the Chief of Police would allow the debate to go ahead…. seriously.
Another reliable cheerleader and comedian to stick his neck out has been silly Salleh, the wizard communications minister, who is also always pretty good for a giggle. He has chosen to characterise the DOJ’s findings as ‘an act of treason by the Malaysian opposition‘. This presumably offers the opportunity to jail all critics of 1MDB:
Communications and Multimedia Minister Salleh Said Keruak has criticised the opposition for purportedly seeking foreign intervention into Malaysian politics.
He also accused Pakatan Harapan of misleading Malaysians on the implications of the United States Department of Justice’s (DOJ) latest court filing related to 1MDB.
Salleh pointed out that the DOJ was acting merely on complaints it received and had made it clear the civil forfeiture complaint contained allegations which are not proven until a court decided otherwise…..
The problem is that the DOJ’s points are to all intents and purposes proven with deadly effectiveness. The fact that the criminal proceedings are not concluded cannot deny the truth that public prosecutors have identified billions of dollars of criminal misappropriation, which ended up in Najib’s accounts.
Not a single third party has moved to counter a single aspect of the allegations – instead banks, auction houses, jewellers, lawyers, realtors, wealth managers have all cooperated and conceded information that substantiates the DOJ’s case.
In response, Najib and his allies have claimed that his funds came from an anonymous royal and that no money has gone missing from 1MDB, despite its yawning debts. They have provided no proof or evidence whatsoever to back such unlikely claims.
The DOJ in its court papers has baldly referred to these excuses as a lie, plain and simple. This is how they put it:
“The Malaysian Attorney General ultimately characterized the payment of $681 million as a “personal donation to [MALAYSIAN OFFICIAL 1] from the Saudi royal family which was given to him without any consideration.”
348. In fact, as explained above, official bank records for the Tanore Account confirm that (a) the payment of $681 million came from the Tanore Account… the only funds in the Tanore Account at the time of the $681 million payment originated from 1MDB.
Simple. So AG Apandi, Najib’s most valued version of Comical Ali is wrong/lying/both, according to the DOJ.
This is not entirely surprising, since Apandi’s predecessor was drawing up charges against Najib on the day he was marched at gun point from his office and unconstitutionally sacked on the PM’s orders – Comical Apandi Ali is there for a reason.
It is up to Malaysians, as far as the DOJ are plainly concerned, to decide if they are going to decide to believe in their own Comical Ali and Najib’s dimishing band of defenders. They are going for the assets and the crimes committed in the United States.
There is meanwhile an alternative view put forward by Najib’s defenders, which is that a suspected criminal should be allowed to continue in the highest office of the land, until proven guilty by a court of law.
Under this line of argument the concept that a tainted politician should put his country and his party first by stepping down until exonerated (hopefully) in a court of law, is cast aside. The reason being, of course, that the moment Najib steps down is the moment that Malaysia’s own forces of law and order will wake from their witch’s spell and resume their own investigations into the country’s largest recorded theft so far.
Unless, Comical Hishamuddin now agrees to step forward and take over in a deal to grant his cousin immunity from prosecution, of course. The question is whether that is a promise that the cousin can guarantee?