PM, did you okay 1MDB’s US$500 million loan to Petrosaudi, DAP asks
Prime Minister Datuk Seri Najib Razak must answer if he had given the go-ahead to state-owned 1Malaysia Development Berhad (1MDB) to loan PetroSaudi International Limited’s wholly owned subsidiary US$500 million, DAP said today.
Its national publicity secretary, Tony Pua, said Najib must confirm if he had done so in 2010 as finance minister, following another expose on 1MDB by the Sarawak Report yesterday.
"For the very first time, emails exposed by the Sarawak Report on the monster 1MDB scandal have implicated Najib and his possible involvement in the PetroSaudi International (PSI) collaboration fiasco," Pua said in a statement.
He also challenged Najib, who is also finance minister, to act against the person who said he had approved the loan, if such claims were false.
Whistleblower site Sarawak Report revealed email transactions between the figures involved in the deal.
In a purported conversation between businessman Low Taek Jho and PetroSaudi director Patrick Mahony on BlackBerry Messenger in 2010, it was revealed that Low had allegedly attempted to bypass Bank Negara Malaysia (BNM) by claiming that Najib had approved the loan.
Low allegedly told PetroSaudi that BNM's approval for the loan was not needed as it would cause unnecessary "delays".
Low, who is popularly known as Jho Low, had said: "Ministry of finance has approved (the loan). Not bnm because we don't think bnm needed."
He also claimed that the "pm who is also FM" had signed off the loan itself, despite Mahony's repeated requests for an official explanation as to why the BNM's approval was unnecessary.
Sarawak Report said Low had also told Mahony that 1MDB would be entirely liable and responsible for the loan, even though the strategic investment company appeared to be barely engaged in the conversation.
Mahony had later emailed the entire conversation to fellow PetroSaudi director Tarek Obaid, adding that the dates corresponded to a US$500 million Murabaha loan agreement between 1MDB and PetroSaudi on July 26, 2010.
Pua, who is also Petaling Jaya Utara MP, said the expose raised several pertinent issues and questions.
"First and perhaps most importantly, did Najib approve the loan signed between 1MDB and the PSI subsidiary?
"1MDB had mysteriously converted their US$1 billion shares in the 1MDB Petrosaudi Limited joint venture (JV) on the last day of the March 31, 2010 financial year, into a US$1.2 billion (RM4.3 billion) loan in the form of Murabaha notes to the company.
"The conversation refers to an additional US$500 million (RM1.8 billion) which was extended to the PSI subsidiary on September 8, 2010. Did the finance minister give his approval for these loans?"
Pua said the conversation also exposed Low’s intimate involvement in the operations of 1MDB to the extent that perhaps, Datuk Shahrol Halmi, who was the CEO of 1MDB then, had been a mere puppet.
The DAP MP cited that evidence exposed by Sarawak Report earlier also revealed that Low was involved in matters like putting together the JV, laying down the terms of the JV agreement, and dictating all the relevant financial transaction sums on behalf of 1MDB, well before the company's senior management was even involved.
"We already know that out of the initial US$1 billion invested by 1MDB into the JV, US$700 million was immediately siphoned out to a Swiss bank account belonging to Good Star Limited, which was controlled by Jho Low and his associates.
"For the subsequent US$500 million loan to PSI, only US$340 million went to the PSI subsidiary while the balance of US$160 million was again deposited with Good Star Limited.”
He said if Najib chose to deny his knowledge or involvement in what was claimed by Low, immediate action must be taken against the latter for his actions to defraud 1MDB by abusing the name of the prime minister.
Najib, he said, must file a police report demanding an urgent investigation on Low for his “false” claims.
"He should also initiate a civil suit against Jho Low for misrepresentation and tarnishing the image and reputation of the Malaysian prime minister.
"If Najib fails to act against Low, then he cannot blame Malaysians for speculating on his complicity and involvement with the whole 1MDB-PetroSaudi rip-off.”
1MDB's links to PetroSaudi were thrown in the spotlight after Sarawak Report claimed that Low had orchestrated the 2009 joint venture between the two companies to siphon off US$700 million from 1MDB.
Sarawak Report claimed that PetroSaudi agreed to act as a "front" for Low in future deals, and that the firm had no wealth or assets of its own.
The joint venture fell through only six months later, but 1MDB continued to conduct deals with PetroSaudi, and lent it another US$500 million in 2010, and another US$300 million in May, 2011, for reasons it has never disclosed.
Sarawak Report's exposes have prompted opposition politicians, former Umno leaders and anti-graft bodies to demand a thorough investigation into 1MDB, and put pressure on Najib, who is also chairs the 1MDB advisory board.
Last Wednesday, Najib ordered the auditor-general to vet 1MDB's accounts after the Cabinet was briefed about the company's accounts and told that allegations against it were related to transactions by third parties such as PetroSaudi. – March 9, 2015.
