Najib’s government cracks down on freedom of speech, in wake of 1MDB scandal

A senior Malaysian journalist who quit his job at a leading newspaper said Prime Minister Najib Razak’s government has cracked down on freedom of speech as it tries to limit the fallout from a graft scandal surrounding a state investment fund.

…A journalist’s responsibility is “first to the truth,” Mr. Mustapha wrote.

Investigators in at least seven countries are probing 1Malaysia Development Bhd., or 1MDB, a government investment fund Mr. Najib set up in 2009 to boost growth. Some investigators have said they believe $6 billion has gone missing.
Hundreds of millions of dollars originating from 1MDB allegedly moved into Mr. Najib’s private accounts via a web of offshore entities, and was spent on politics, jewelry and clothes, The Wall Street Journal has reported, citing investigators and bank-transfer documents.

Mr. Najib’s government has banned newspapers it controls—which include the New Straits Times and the larger-circulation Malay-language Berita Harian and Utusan Malaysia newspapers—from covering the 1MDB story, Mr. Mustapha said in an interview.

News releases from 1MDB denying stories in the Journal and calling into question its sources would sometimes come to the New Straits Times from the prime minister’s office with orders to run the statements in their entirety, according to Mr. Mustapha. The newspaper did as they were told.

“There are specific instructions to use this or that story, and we’re not allowed to question,” he said….Mr. Najib’s administration has cracked down on criticism of 1MDB in other ways. Last year, a former ruling-party politician was arrested on charges of economic sabotage after he called for an investigation into 1MDB. He was later released on bail.

“When an American newspaper…wrote a story that got nominated for the coveted Pulitzer Prize, about an issue that happened right under my nose, I began to seriously search my conscience and asked myself why I was in journalism in the first place,” he said.

source: Wall Street Journal

Posted in BN, jijik, najib, umno

Najib’s 1MDB mess continues to entangle Malaysia

..Prime Minister Najib’s 1MDB mess is wrapping its tentacles around an entire nation. The unpredictable ways in which it threatens to drag Southeast Asia’s third-biggest economy under, like some massive vampire squid, can be seen in Putrajaya’s balance sheet. Could it even lead to a credit downgrade?

Yes, argues Sian Fenner of Oxford Economics in Singapore. Malaysia’s total government debt, she reckons, ended 2015 at 54.5% of gross domestic product, a heavy burden relative to Asian peers. As Najib dismantles the debt-ridden 1MDB he created in 2009, his government may have to assume some liabilities. According to Fenner’s calculations, that could top 2.5% of GDP. “We find that it would have a material effect on asset prices and pressure on the exchange rate could see Bank Negara raising interest rates to support the currency despite weaker domestic activity,” she says.

In March, Fitch warned a downgrade was “more than 50 percent likely” as 1MDB struggled to meet obligations and the trade balance darkened. Last month, 1MDB defaulted, adding to what traders call “headline risk.” At the same time, corruption probes in at least seven countries are intensifying even as Najib’s government insists the case is closed. Hardly, with overseas investigators sniffing around to locate more than $6 billion of funds believed to be unaccounted for. And as the Wall Street Journal alleges, investigators are all over hundreds of millions of dollars Najib and his family may have used to finance everything from real estate to jewelry to Leonardo DiCaprio’s “Wolf of Wall Street” film.

Sadly, Putrajaya’s response has been to circle the wagons and blame the messenger. Najib recently said his central bank directed the police to investigate foreign media outlets breaking news on 1MDB. That’s an ominous sign for the state of central-bank autonomy in Kuala Lumpur. As I wrote last month, there are questions about whether new Governor Muhammad Ibrahim can maintain the same independence as predecessor Zeti Akhtar Aziz.

Far from boosting Malaysia’s economy, 1MDB is denting its standing as global headwinds intensify. Last week, Credit Suisse became the latest investment bank – joining JP Morgan and others – in downgrading Malaysian shares. Along with “considerable political and governance risks,” Credit Suisse cites oil-price trends and an economy that “remains subject to negative growth revisions and a weak consumer.”

This circles back to Fenner’s view. Since late 2009, she says, the share of debt held by foreigners has more than doubled, and amounted to more than a third of total debt at the end of the first quarter. The drip, drip, drip of bad news since then only increases Malaysia’s vulnerability to shifts in investor sentiment. “While at these levels debt is still manageable, there are several factors that have increased Malaysia’s vulnerability,” Fenner warns.

It should worry investors that 1MDB’s tentacles are wrapped so tightly around what should be one of Asia’s most vibrant economies.

One is how a government in full survival mode isn’t restructuring an economy falling further behind. Early in his premiership that began in 2009, Najib pledged to scale back the affirmative-action polities benefiting the ethnic-Malay majority. That scheme, implemented by Najib’s prime minister father in the early 1970s, kills productivity, deadens innovation and encourages multinational companies to set up shop in Singapore, Indonesia and Vietnam instead of Malaysia.

Another is how Najib’s party, which has held power since 1946, is neutering government institutions to extend its reign. Case in point: a proposed overseas travel ban on Malaysians who criticize the government. The assault on the media, both domestic and foreign, is troubling, too. For a reality check, I recommend reading Wall Street Journalreporter Tom Wright’s interview with Mustapha Kamil, who recently resigned from New Straits Times newspaper to protest “authoritarian” winds coursing through officialdom.

The more Malaysia obfuscates on 1MDB, the more outside parties pounce. It was truly surreal to see Najib hosting Asia’s World Economic Forum in Kuala Lumpur last week, pretending all’s well in his economy. U.S. law enforcement officials scheduling interviews with Goldman executives (according to the Journal) would disagree. At issue is the U.S. Bank Secrecy Act, which demands financial institutions flag suspicious transactions. It should worry Najib’s team that a law employed to snag Ponzi-schemer Bernard Madoff is looking their way.

It should worry investors that 1MDB’s tentacles are wrapped so tightly around what should be one of Asia’s most vibrant economies. With vast natural resources, 30 million people and enviable proximity to China and India, the place should be thriving. Yet it’s run by a party putting its own interests ahead of the masses. And now, Najib’s creature is squeezing Malaysia’s credit rating. No wonder investigators and investors alike have that sinking feeling.

 source: Barrons
Posted in BN, jijik, najib

Rising public anger over Tokyo governor’s lavish spending

Tokyo’s embattled governor has apologised in the face of rising public anger over alleged inappropriate spending.

Yoichi Masuzoe has come under intense media grilling over lavish outlays on overseas business trips, online auction purchases and accommodation at high-end hotels and spas.

…The telegenic, French-speaking Masuzoe took office in February 2014. A former health and labour minister and member of parliament, he pledged an administration free of money scandals.

But trouble started in late April when reports emerged that he was using his official car to be driven at the weekends to and from a cottage south of Tokyo.

It was later revealed that official trips taken to London and Paris with 20 metropolitan officials last year cost taxpayers 50 million yen (RM1.8mil), with Masuzoe flying first class and staying in luxury suites.

He also allegedly used political funds to buy items such as children’s pyjamas.

source: The Star

Posted in jijik

Najib Razak 1MDB scandal: Swiss approve dissolution of scandal-hit bank

Switzerland’s financial regulators have agreed to the takeover and dissolution of BSI Bank, which has been linked to a global money-laundering scandal at Malaysia’s 1MDB state fund.

The Swiss supervisor FINMA accused merchant bank BSI of “serious breaches” of money-laundering rules in its dealings with 1MDB, which is at the heart of a financial scandal swirling around Malaysia’s Prime Minister Najib Razak.

In the case of 1MDB, the bank executed numerous large transactions with unclear purpose.

Swiss Financial Market Supervisory Authority

In the toughest punitive action yet announced in the affair, FINMA said it was approving the takeover of the merchant bank by Zurich-based private banking group EFG International on the condition that BSI is integrated “and thereafter dissolved” within 12 months.

It ordered the seizure of $US96 million of BSI’s “illegally generated” profits.

“In the case of 1MDB, the bank executed numerous large transactions with unclear purpose over a period of several years and, despite clearly suspicious indications, did not clarify the background to these transactions,” the Swiss regulator said.


1MDB background

Founded in 2009 by Mr Najib, 1MDB is teetering on the brink of collapse amid multiple investigations around the world into allegations that billions were looted from it.

The fund, which ran up more than $US11 billion ($15 billion) in debt in a series of much-questioned investments, has steadfastly denied money was stolen or that it was in financial trouble.

Last year, the Wall Street Journal revealed $US681 million in transfers to Mr Najib’s personal bank accounts.

Malaysia's Prime Minister Najib Razak

He said the money was a gift from the Saudi royal family, most of which he returned.

..The Prime Minister has faced calls to resign but he has tightened his grip on the ruling party and thwarted domestic investigations.

source: ABC News

Posted in jijik, najib

Singapore shuts down bank involved in 1MDB scandal

..The Monetary Authority of Singapore said it will withdraw BSI Bank Ltd.’s status as a merchant bank for breaches of money laundering rules as the Swiss Attorney General said it was taking legal action based on information from criminal probes into 1Malaysia Development Bhd, or 1MDB. EFG International AG said it received approval on Tuesday from the Swiss authorities to take over BSI and still expects the transaction to be completed, although at a reduced price.

“BSI Bank is the worst case of control lapses and gross misconduct that we have seen in the Singapore financial sector,” Ravi Menon, managing director of MAS, said in the statement. “It is a stark reminder to all financial institutions to take their anti-money laundering responsibilities seriously.”

...The actions are part of the global money laundering and embezzlement investigations surrounding 1MDB. A Malaysian parliamentary committee identified at least $4.2 billion of irregular transactions by the state fund, and recommended the advisory board headed by Prime Minister Najib Razak be disbanded. BSI’s Group CEO Stefano Coduri resigned as the Swiss regulator said it will seize 95 million Swiss francs ($96 million) from the firm and start enforcement procedures against two former bank employees.

1MDB didn’t immediately reply to a request for comment on its links to BSI. Both 1MDB and Najib have consistently denied wrongdoing. BSI said Tuesday that it has cooperated fully with the investigations into 1MDB by the Singapore and Swiss authorities. BSI remains well capitalized, it said.

source: Bloomberg

Posted in jijik


Posted in jijik, najib

Former president indicted, assets frozen

Cristina Kirchner, the former president of Argentina, has been charged and had her financial assets frozen by a court over a currency trade which lost the country billions of dollars.

It is the first charge to be levelled against Ms Kirchner, the rabble-rousing, anti-British former leader who divided Argentina into passionate supporters or avid detractors of her highly personal style of leadership.

She is accused of overseeing an operation by the central bank to sell “dollar futures” – contracts to sell the national currency, the peso, at a future date – at an artificially low price in the final months of her presidency last year.

The charges levelled against the former president, her economy minister, the former head of the central bank and 12 members of its board do not make clear who is thought to have benefited from the trade.

But they allege that it was carried out following direct instructions from Ms Kirchner to the minister, Axel Kicillof.

The case is not the first that Ms Kirchner is facing. She has also been named as a suspect in a corruption and money laundering case involving a friend of her husband, Nestor Kirchner, her predecessor as president.


source: Telegraph UK

Posted in jijik
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