Sudden departure of 1MDB chief shows all is not well: Pua

The sudden resignation of 1MDB CEO proves that all is not well in the Government’s investment fund, says DAP leader

PAC member and DAP National Publicity Secretary Tony Pua said Hazem's 'resignation' shows all is not well within the 1MDB

PAC member and DAP National Publicity Secretary Tony Pua said Hazem’s ‘resignation’ shows all is not well within the 1MDB

A company which claims to be doing well and is in the midst of completing a US$3 billion (RM 10.65 billion) initial public offering for its energy division would not, under normal circumstances, be undergoing a major management shake-up, a DAP leader today said.

In a statement this morning, DAP National Publicity Secretary Tony Pua, who is also a member of the Public Accounts Committee, said that 1Malaysia Development Berhad (1MDB) chief executive officer Mohd Hazem Abdul Rahman’s resignation shows all is not well within the company.

“The sudden surprise announcement yesterday of the “resignation” of Mohd Hazem and the immediate appointment of banker Arul Kanda only proved that all is really not well behind the steely façade which has been presented by both the company as well as Prime Minister Najib Abdul Razak himself,” he said.

Pua alleged that despite assurances by 1MDB chairman Tan Sri Lodin Wok Kamaruddin that all is well within the company, the state of the company belies the situation, and suggests that Hazem was ‘fired’.

“(This is) a 100% Ministry of Finance owned company which has accumulated a staggering RM42 billion in debt. If not for the disastrous performance of 1MDB to date, why would there be an admission of a need for a “strategic review” and to find “financial alternatives” for 1MDB?” he added.

Pua said Mohd Hazem was the CEO of 1MDB for less than two years.

“The previous CEO, Datuk Shahrol Halmi was “removed” from his position only on March 22, 2013. Two CEO changes within 24 months can only point only to poor performance and fishy business behind the scenes for the debt-ridden company,” he added.

Hazem’s resignation comes at a time where information has surfaced that the government investment body has been debt-ridden and unable to repay an outstanding RM2 billion of its debt, which is due in November 2014. The RM2 billion debt is actually a portion a bigger RM5.5 billion debt which was rescheduled and restructured since November 2013.

In a report by The Malaysian Insider, it was said that 1MDB has been given until Jan 30 to settle its RM2 billion debt.

The report quoted sources who revealed that problem has been brought to the attention of Bank Negara Malaysia (BNM), and sources said at a recent meeting, top executives from 1MDB which included Lodin, director Tan Sri Ismee Ismail and outgoing CEO Mohd Hazem Abdul Rahman were given a dressing-down by the central bank.

Pua said 1MDB has also failed to raise a required RM8.4 billion in loans in November 2014 to kick start a RM11 billion power plant project which was awarded by the Government in February 2014.

“As a result, not only 1MDB had to suffer the ignominy of postponing the fund raising exercise to this year, the power plant project delivery will be significantly delayed,” he added.

Pua urged the authorities to investigate the matter, in particular after the filing of a police report by an Umno leader against the alleged mismanagement and possible corrupt practices within the company, and pressed for Najib to agree to an audit by the Auditor-General and the PAC.

– The Rocket

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