“Where has 1MDB’s USD 3 billion disappeared to?” asks DAP

Tony2-650x400Questions are being raised on the ‘vanishing’ US$3 billion from the trouble 1Malaysia Development Berhad, which was raised by its subsidiary, the 1MDB Global Investment Limited.

Petaling Jaya Utara MP and Public Accounts Committee member Tony Pua at a press conference today said highlighted that while the media and its critics have often focused on the mysterious US$2.32 billion of ‘investment’ in the Cayman Islands, the 1MDB Global Investment Limited funds have often escaped scrutiny.

According to Pua, the money was raised by 1MDB Global Investments in March 2013 to jointly fund Abu Dhabi Malaysia Investment Company Limited (ADMIC), a 50:50 joint venture between the 1MDB Global Investments and Aabar Investments, an investment arm of the Emirate of Abu Dhabi.

However, he said, none of the projects had materialized while said the joint venture remains in “limbo”.

These projects, as reported by The Star on 13 March 2013, included the RM 39 billion commitment by the UAE to fund the RM 21 billion strategic reserve in Tanjung Piai, Johor, and RM 18 billion strategic partnership in the Tun Razak Exchange (TRX).

“Despite that, 1MDB had revealed in its March 2014 financial statements that nearly half the money it had raised in the prior year has already been utilised. The report stated that US$1.44 billion has already been used up by 1MDB “for working capital and debt repayment purposes”,” he said.

The other portion of the USD 3 billion was in the form of debt securities (bonds) amounting to USD 1.56 billion, which was reportedly placed in “various investment portfolios under custody of a licensed financial institution with good credit ratings.”

“Just as we were left clueless about the segregated portfolio investment company in the Cayman Islands, we are also now left scratching our heads as to where exactly is this US$1.56 billion located or invested,” Pua said.

With the presence of liquid investments of billions of ringgit in un-utilised funds in the aforementioned licensed financial institution, Pua questioned the need for a government bailout via the letter of support.

“Again, just like the mysterious money that is now sitting in BSI Singapore which cannot be repatriated, 1MDB and the Government must explain how these government guaranteed funds have been utilised, abused or misappropriated,” he said.

On Nov 18 last year, Deputy Finance Minister Ahmad Maslan had conceded that there was a “letter of support” for 1MDB via its subsidiary 1MDB Global Investment Limited to raise a US$ 3 billion bond on Nov 6.

-The Rocket

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