How was 1MDB saved without public funds, DAP asks Najib

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KUALA LUMPUR (Jan 12): Datuk Seri Najib Razak must explain in Parliament how 1Malaysia Development Bhd's (1MDB) financial woes were resolved without the use of public funds, says DAP.

Its national publicity chief Tony Pua said today that failure to do so only proved that the prime minister had much to hide and did not dare answer the country's supreme legislative body.

Najib said yesterday that public funds were not being used to resolve 1MDB's financial issues.

"What we are glad about is that we are resolving it not by way of a memorandum of understanding (MoU) but through an 'agreement', without touching any of the people's money," he said in a statement.

But Pua said any financially literate Malaysia would know that the prime minister was lying through his teeth in attempting to sweep the RM50 billion scandal under the carpet.

He added that Najib could elaborate on the matter by giving a ministerial statement on the state investment vehicle and allow a debate at the special parliamentary sitting on January 26.

The reality was 1MDB's problems were not resolved, he said citing the “agreement” with Abu Dhabi’s International Petroleum Investment Company (IPIC).

Pua said the proposed RM18 billion debt-asset swap with IPIC had not been completed and there was no certainty that 1MDB would be able to cough out RM18 billion of assets to swap the equivalent amount of debt with IPIC by June 2016.

He said the agreement signed in June 2015 was possible because Putrajaya provided an indirect guarantee to IPIC to bail out 1MDB. If 1MDB failed to fulfil its part of the obligations, Malaysian taxpayers would have to fork out cash to compensate IPIC.

Pua said the equity sale of Bandar Malaysia to the Iskandar Waterfront Holdings and China Railway Engineering (IWH-CREC) consortium was also far from being completed, as acknowledged by 1MDB.

"The completion will only take place in June 2016 on the assumption that all conditions attached to the agreement can be fulfilled by all parties.

"On the second count, even if they were resolved (and they are not), they are being resolved with a bailout by the taxpayers," Pua said.

He added that Bandar Malaysia was sold at a massive profit only because the federal government sold the land to 1MDB at heavily discounted prices.

1MDB bought the land parcels for RM1.6 billion in 2012, and recently sold 60% of the land for a purported RM7.41 billion despite not having laid a single brick on the land, Pua said.

"The money received from the sale should have gone into the national treasury to help the man on the street cope with rising cost.

"Instead, it went to 1MDB to help 1MDB pay down its debts," he added.