KUALA LUMPUR: The National Audit Department was hampered in its investigation into troubled 1Malaysia Development Bhd (1MDB) because the latter’s executives were not forthcoming in providing documents that were deemed integral, Auditor-General Tan Sri Ambrin Buang revealed to the Public Accounts Committee (PAC) yesterday.
PAC chairman Datuk Nur Jazlan Mohamed said the documents requested included bank statements, agreements and documents relating to 1MDB’s investments.
This was revealed by Ambrin to the bipartisan parliamentary committee after a three-hour-long briefing yesterday. Ambrin had earlier handed over the highly-anticipated interim audit report on 1MDB’s finances to the PAC.
Apart from certain bank statements, The Edge Financial Daily was made to understand that 1MDB had also refused to provide the auditor-general with the agreement detailing the options 1MDB gave to International Petroleum Investment Co and its subsidiary, Aabar Investment PJS, and a subsequent settlement agreement to terminate the options, as well as an agreement with Tanjong plc to settle a RM2 billion loan payment.
Although the PAC was satisfied with the work and scope carried out by the National Audit Department on 1MDB, Nur Jazlan expressed concern over the strategic development company’s lack of cooperation in providing some important documents to the auditor-general.
“There were hindrances faced by the auditor-general as 1MDB was not forthcoming with them. I hope 1MDB can give them the information they are asking for to help them complete their investigation,” Nur Jazlan told reporters at the parliament building yesterday.
Being a company that is fully owned by the Finance Ministry, Nur Jazlan pointed out that it is the responsibility of the ministry to instruct 1MDB to hand over the necessary documents to the auditor-general. When asked whether there was any concern that some of these documents would go missing or could be tampered with, Nur Jazlan said: “I can’t make a judgement on that, but at the end of the day, the auditor-general needs those documents to complete its report”.
Meanwhile, Nur Jazlan said the final report of the auditor-general will be handed over to the PAC at the “soonest date this year”. The final report will also be tabled in Parliament and be made public.
For now, Nur Jazlan said the interim report will not be made public, but the findings from the report will be used by the PAC in its hearings on 1MDB. The scope of the interim report by the auditor-general was based on the loans, debts, cash flow and study of financial accounts of 1MDB and its subsidiaries from 2010 to 2014, he said.
Nur Jazlan also said the auditor-general took three months to complete the interim report on 1MDB, which included investigation into its investments in PetroSaudi International Ltd.
Other deals pertaining to 1MDB’s land and power projects are still ongoing and will be included in the final report of the auditor-general’s investigation into the company, he said.
On the recent revelations by The Wall Street Journal (WSJ) showing US$700 million (RM2.65 billion) was allegedly moved from 1MDB to Prime Minister Datuk Seri Najib Razak’s personal bank accounts at AmPrivate Bank, Nur Jazlan said the PAC can only suggest to the auditor-general to look into the matter.
Najib has since responded that he had never taken any funds from 1MDB for personal gain, and pinned the blame for the latest WSJ report on former prime minister Tun Dr Mahathir Mohamad, who has in recent months called for Najib’s resignation.
The documents, which the WSJ said were sourced from a “Malaysian government investigation”, include a remittance application form, a cash deposit authorisation letter and charts outlining the flow of money.
In a separate statement yesterday, 1MDB president and group executive director Arul Kanda Kandasamy claimed, however, that all documents in 1MDB’s possession had already been submitted to the National Audit Department.
“As requested by the PAC chairman, we will immediately contact the National Audit Department to seek clarity on which documents the PAC chairman is referring to,” said Arul.
“We note in particular, the PAC chairman’s comments on the thoroughness of the auditor-general’s investigation, which included inspecting documents obtained from 1MDB and other parties.
“As the interim report has not yet been shared with 1MDB, we are unable to comment on the PAC chairman’s statement that certain documents appear to have not been submitted,” he said.
“1MDB reiterates our commitment to fully cooperate with the auditor-general and all lawful authorities that are currently investigating 1MDB,” said Arul.
This article first appeared in The Edge Financial Daily, on July 10, 2015.