THERE are differences between the financial scandals which occurred during the tenure of Dr Mahathir Mohamad and Najib Razak, and blaming the former prime minister for setting a precedent for corruption is to miss the glaring fact that the 1MDB scandal implicated a sitting prime minister, an activist said.
Blaming Dr Mahathir, as PAS president Abdul Hadi Awang did recently for creating a “leadership by example” culture of graft, would not resolve the allegations of misappropriation in 1Malaysia Development Bhd, said Centre to Combat Corruption and Cronyism (C4) executive director Cynthia Gabriel.
Other activists and observers said Hadi failed to grasp the severity of the scandal and the purpose of investigations into 1MDB by foreign authorities.
Gabriel said the Bank Negara forex scandal, which took place during Dr Mahathir’s administration, and 1MDB under Najib now were two different types of crimes.
She also pointed out the chain of events under Najib but no action has been taken by the Malaysian authorities against him or 1MDB.
“(The forex scandal and 1MDB) should be investigated, but the difference now is that Najib is a sitting prime minister and he is alleged to have committed grand corruption , which means he is at the centre of all the cross-border financial flows which are illegal.
“It becomes important for him to step aside because it has been so clear that the task force set up during the first wave of public outcry was disbanded, the then attorney-general (AG) was sacked, the deputy prime minister was sacked (for speaking out against Najib) and a new A-G was brought in.
“And then what happened to that task force? It is no longer in existence. There is a clear issue of interference in the investigation,” Gabriel said.
She also questioned the timing of the government’s probe into the Bank Negara forex scandal, which made it look more like fodder for a “political blame game” rather than a sincere fight against corruption.
“Although Dr Mahathir was prime minister for a very long time and he subverted many of our democratic institutions, he was never at any point in his tenure investigated by any foreign jurisdiction or by the Malaysian anti-corruption body for any specific corruption crime.
“I think it is important now for us to ask, why did the authorities keep silent about it all this while if there was an issue?
“It has been over 20 years and only now do we want to have royal commission of inquiry.”
Hadi named the forex scandal along with several other cases involving alleged graft – Bumiputra Malaysia Finance (BMF), Perwaja Steel, Employees’ Provident Fund, Tabung Haji, Petronas, Skyhawk, Maika Holdings and the Port Klang Free Zone – which took place during Dr Mahathir’s tenure.
Gabriel added that it was “naive” of Hadi to say that foreign investigators should not probe into 1MDB.
She said these entities were doing so because they wanted to protect their financial integrity and combat money-laundering in their own countries.
“They want to ensure their own systems are not compromised, and that is why they are seizing assets.”
The US Department of Justice (DoJ) has filed three civil suits to date to seize assets allegedly bought with money stolen from 1MDB. These assets include jewellery, a yacht, luxury properties and movie production rights.
Bersih 2.0 chairman Maria Chin Abdullah said the present corruption was “multiplefold”.
One of these reforms needed was the separation of powers, where the prime minister should not simultaneously hold the post of finance minister.
“Worse, Najib was also in 1MDB as chairman of its advisory board, and 1MDB was an investment arm of the Ministry of Finance. It’s a total conflict of interest in every sense.
“We can’t have a prime minister who admits to taking funds from foreign sources and uses (the money) to allegedly influence general elections,” Maria said, referring to Najib’s admission when the 1MDB scandal first broke that funds channelled into his bank accounts were a donation from Saudi Arabia.
“This should be our concern as that is an abuse of position and goes against the grain of transparency in political financing.”
Maria also said that Hadi was missing the point of the three civil suits filed by the DoJ.
“It’s not about undermining the present government or foreign influence. It’s about protecting and preventing money-laundering in the US. In doing so, it has a spill-over effect on Malaysia because 1MDB was used extensively as a conduit for these illegal fund transfers.”
Penang Institute Political Studies head Dr Wong Chin Huat said Dr Mahathir was indeed flawed, but questioned Hadi’s logic of defending Najib who was following his predecessor’s example.
“Why must Hadi come to the defence of Najib, who follows Dr Mahathir’s flawed example? Why doesn’t Hadi follow (the late PAS leader) Nik Abdul Aziz’s (Nik Mat) example to consistently reject Najib’s rule?” he said.
National Oversight and Whistleblowers (NOW) Centre co-founding director Akmal Nasir also slammed Hadi for rejecting investigations by foreign authorities.
“It is not a matter of foreign powers interfering. The issue is how to resolve corruption in 1MDB. Are we just going to deny it happened when other countries are looking for evidence and probing the matter?”
Akmal said 1MDB’s scandal may not be solved if its structure and governance were corrupted to begin with.
“It’s better to change the entire situation through reforms, rather than allow one scandal after another to take place,” said Akmal, whose work with NOW has exposed corruption in other government-linked entities, such as Yayasan Pembangunan Ekonomi Islam (Yapeim). –