Art questions 1MDB ‘paper-shifting exercise’

The commentator asks why the Finance Ministry assets, owned under its subsidiary 1MDB, were transferred to itself.

1MDB assets such as the TRX and Bandar Malaysia development were transferred to the Finance Ministry. (Facebook pic)

PETALING JAYA: Activist lawyer Azhar (“Art”) Harun has scoffed at former prime minister Najib Razak’s remarks about the transfer of 1MDB assets to the Finance Ministry, saying the former prime minister’s explanation only reflected a “paper-shifting exercise”.

Azhar Harun

He took issue with Najib’s remarks as quoted in a news report that 1MDB had transferred its assets to the Treasury and the government therefore had to pay the company’s debts in return.

“Not all Malaysians are ignorant when it comes to this kind of ‘paper-shifting exercise’ Dear YB Pekan,” he said, referring to the former premier as MP for Pekan.

He was referring to 1MDB’s rationalisation plan, approved by the Public Accounts Committee of Parliament in 2016, by which land and other assets belonging to state-owned 1MDB would be transferred to the Finance Ministry directly, to be held by Minister of Finance Incorporated.

The Public Accounts Committee, comprising members of both sides in the Dewan Rakyat, said it had identified weaknesses in 1MDB’s capital structure and management, and made recommendations for further action. It called for the 1MDB board to be dismissed and for 1MDB assets and subsidiaries (comprising TRX, Bandar Malaysia, the Air Itam land, Pulau Indah land) to be handed over to
MOF Inc.

On Friday, amid continuing controversy over the company’s debts, Najib had said in a statement that although MOF Inc had taken over the assets, 1MDB’s debt or liabilities remained with the company.

“Accordingly, the arrangement, as I can confirm, is for MOF Inc to service 1MDB debts, but in return for taking over the assets,” Najib said. “Put another way, had those assets remained in 1MDB, (the company) could have developed and sold the assets on its own, and used the proceeds to pay its debt.”

However, Art said today: “You (the supreme financial advisor to 1MDB) transferred all of 1MDB assets to the MoF (which was, coincidentally, yourself) after having consulted the prime minister (which happened to be yourself) to enable the MoF – and thus the people of Malaysia – to pay 1MDB’s debts,” he said.

“Now if that wasn’t a bailout, what is?” he said

He asked why 1MDB did not then develop and sell the assets on its own. “Why must 1MDB transfer these precious assets, that 1MDB could have developed and sold by itself, to the MoF? Wasn’t that what 1MDB had set out to do in the first place?” he said.

He said the Finance Minister, being the sole owner of 1MDB, was also the effective owner of all 1MDB assets.

“Being so, why would the MoF effectively transfer its own assets – assets that it effectively owned – to itself?” he said.

“Why wasn’t Parliament briefed of this?” he added, asking for the valuation at which it was transferred. - FMT