1MDB has no cash after all
(The Edge Markets) – There is no cash after all in 1Malaysia Development Bhd’s (1MDB) Singapore bank account.
That was the shocking revelation by Prime Minister Datuk Seri Najib Razak (pic) yesterday in response to a parliamentary question asked by DAP lawmaker Tony Pua.
Pua asked whether Bank Negara Malaysia (BNM) had been informed by the authorities in Singapore that the bank statements of 1MDB and its subsidiary (Brazen Sky Ltd) at the Singapore account of Swiss bank BSI had been falsified and whether there was US$1.103 billion (RM3.99 billion) in cash in the account as previously stated.
“1MDB has explained that the redeemed investments of 1MDB [from the Cayman Islands] are in the form of assets in US dollars in a bank in Singapore for the purpose of balancing the liability of the company’s US dollar,” said Najib in his written reply to Pua.
Najib, who is also the finance minister, told Parliament in March that the cash redeemed from the funds that were kept in the Cayman Islands is now with BSI Singapore. In his written reply yesterday, he said the answer he gave in March is now “amended”.
1MDB president and group executive director Arul Kanda Kandasamy also said that 1MDB had placed its funds in the form of US dollar cash in Singapore instead of Malaysia as 1MDB planned to use the money to service its US dollar-denominated debt.
In an immediate response, Pua yesterday lashed out at the prime minister and Arul, accusing them of lying when they said in March that the money redeemed from the Cayman Islands was in cash.
“This is an admission that it has no cash in BSI Bank Singapore. It’s paper, not cash. What they did was they shifted the paper assets from Caymans to Singapore,” said Pua, a strident critic of the state investment arm, at the Parliament lobby yesterday.
Pua demanded to know the real value of the paper assets as he believed that it was the reason 1MDB was having problems servicing its debts.
“1MDB had lied to the people by claiming they have a lot of cash in the account. I want 1MDB to explain this because all along we have been led to believe there is cash in the bank account,” he said.
