BY THE MALAYSIAN INSIDER
Published: 4 May 2015 7:00 AM
The Public Accounts Committee (PAC) will start questioning those linked with 1MDB after May 18 when Parliament resumes its session. – The Malaysian Insider file pic, May 4, 2015.The Public Accounts Committee (PAC) has unanimously agreed to question those involved in the setting up, management and regulating of 1Malaysia Development Bhd (1MDB), the government-owned strategic investor which has racked up debts totalling RM42 billion since 2009 and is now under probe by the auditor-general.
The Malaysian Insider learnt that PAC will start its hearings after May 18 when the next Dewan Rakyat parliamentary session resumes. The hearing will continue from the last hearing on the matter in 2012.
"PAC agreed unanimously last week to call in those involved with 1MDB while they wait for the auditor-general's report.
"They will start with Ministry of Finance officials who help set up 1MDB, followed by 1MDB executive, the company board, and the auditors," a source told The Malaysian Insider.
Another source confirmed the probe, adding that letters will be issued to those involved in the issue to present themselves for the hearing.
"The letters will be issued on Tuesday. There is a possibility that Bank Negara officials might have to testify over their responsibilities in the company," the second source said.
"As it is, there does not seem to be any government rep in the 1MDB board. That is a cause of concern," he added.
PAC and Prime Minister Datuk Seri Najib Razak had ordered the auditor-general in March to investigate 1MDB over reports of profligacy and inability to pay debts despite a RM51 billion asset base.
The auditor-general has not given a time frame to conduct an audit but promised it as quickly as possible.
PAC chairman Datuk Nur Jazlan Mohamed had said then that the auditor-general must focus on "five crucial points", including 1MDB’s source of RM2 billion funding to settle its loans with several local banks, the PetroSaudi deal, Finance Ministry’s injection of RM3 billion into the sovereign fund, proceeds of 1MDB’s investment in the Cayman Islands channelled back into the country, and reasons behind the change in the international auditing firm to approve the sovereign fund’s accounts.
“The auditor-general must address these points. They are crucial issues which need answers as they relate to 1MDB’s dealings,” he was quoted as saying then.
1MDB is Malaysia's self-styled strategic investor had chiefly invested in property and power plants across Asia but now face a cash crunch as concerns rise about its cashflow.
The government has set aside a RM900 million standby-credit facility for 1MDB with reports saying it has been used as the company services its loans.
1MDB also said that it kept money in Singapore but there is some speculation over the whereabouts of the money.
In 2012, PAC under former chairman and minister Tan Sri Aziz Khalid had probed into 1MDB, adding it was “healthy and balanced”.
Calling a document “crucial”, Azmi said: “We realised that the financial statement for March 2011 is not confidential and is available online. So based on the documents, we found that they (1MBD) have a healthy balanced sheet.”
PAC had started investigations in November 2011 and arrived at this conclusion based on only one document received out of the seven requested. The other six documents are related to 1MDB’s investments with PetroSaudi International Limited, which has drawn a wary response from some Malaysians. – May 4, 2015.
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