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Malaysia Premier Says 1MDB Fund Wrongdoing Larger Than Thought

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Malaysia
  • Malaysia Premier Says 1MDB Fund Wrongdoing Larger Than Thought

Malaysian Prime Minister Mahathir Mohamad said more wrongdoing occurred at state fund 1MDB than was publicly known, as he accelerates efforts to reopen a probe into the scandal-plagued company and the actions of his predecessor.

The government will reach out to authorities in Switzerland, the U.S., Singapore and other jurisdictions as it attempts to recover funds that were diverted from 1MDB, Mahathir told reporters on Wednesday.

A declassified Auditor General report on Tuesday did not bring massive surprises, and did not mention former premier Najib Razak by name. But it showed investigators expressed widespread concern about anomalies in 1MDB’s accounts, and said officers acted on investments against or without full knowledge of the board of directors on several occasions.

“The main issue is of corruption, particularly 1MDB as well as the money that was embezzled by the previous government,” Mahathir said. “I have been briefed by the police and the auditor general and it is very clear that there were more wrongdoings committed than what was known by the public and me.”

1MDB, set up in 2009 to fund domestic infrastructure projects and whose advisory board Najib once chaired, didn’t submit management accounts for the year ended March 2015 and bank statements from foreign financial institutions. The audit team said it couldn’t access computers, notebooks and servers at 1MDB for the purpose of crosschecking and analyzing its findings.

“Overall, corporate governance and internal controls in 1MDB were less than satisfactory,” the summary said. “Some actions by 1MDB’s management and decisions by the board of directors were carried out in a manner that wasn’t proper.”

The audit report on 1MDB had been protected since 2016 by the Official Secrets Act. Mahathir’s move to release it comes as he seeks to tighten the net around Najib, whom he defeated in an election last week, and other officials over the multi-billion dollar scandal surrounding the fund’s actions dating back some years. Mahathir has barred Najib from leaving Malaysia in the meantime.

“There is an aggressive push by the new administration to reopen criminal investigations on 1MDB against the former PM as well as other individuals,” said Nizam Ismail, head of regulatory practice at RHTLaw Taylor Wessing LLP in Singapore. “If there are new transaction trails being uncovered in Malaysia, this could impact financial institutions which had been involved in the money flows, in Singapore, Switzerland and beyond.”

Global Probes

Mahathir, who was once Najib’s mentor and ally and who is back in power after a prior stint as premier from 1981 to 2003, accused him repeatedly on the campaign trail of being a “thief” over alleged graft at 1MDB. Najib has denied any wrongdoing and was cleared by the attorney general at the time, while the fund has repeatedly denied any misconduct.

The 1MDB scandal spawned global probes as investigators tracked a money trail stretching from Switzerland to Singapore and the U.S. The Department of Justice alleges that $3.5 billion from the fund went missing.

Malaysian financier Low Taek Jho has been ordered by a U.S. court to turn over his $250 million yacht “Equanimity” to the U.S. authorities who plan to sail it from Indonesia and sell it in the U.S. The yacht is among more than $1.5 billion in assets that the U.S. claims Low and his accomplices acquired with money they siphoned from 1MDB.

Debt Payments

The declassified report found, among others things, that 1MDB used 288 million ringgit ($73 million) of government funds to pay interest on its debt, which went against the monies’ original purpose. 1MDB raised 3.98 billion ringgit from domestic debt and sukuk issuance, of which only 246 million ringgit was invested in two property projects, while 2.16 billion ringgit was advanced to the company. 1MDB said in March all its funds are fully accounted for.

Swiss prosecutors said Tuesday they wanted to start talks with investigators in Malaysia as soon as possible to better coordinate various criminal probes into the sprawling case.

The Office of the Attorney General of Switzerland “is very much interested in renewing dialogue with the competent authorities in Malaysia” and “favors an exchange between partnering authorities at their earliest convenience,” it said in an email.

Singapore authorities also weighed in. The city-state has cooperated extensively with their Malaysian counterparts on past requests on the matter and is ready to extend further assistance, the Monetary Authority of Singapore and the Commercial Affairs Department said in an email early Wednesday.

Swiss Attorney General Michael Lauber has been publicly critical of the lack of cooperation his team of prosecutors got from Najib’s government. Singapore has punished banks over lapses related to 1MDB, seized assets and jailed bankers over the scandal.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Netanyahu Stands Firm as US Halts Bomb Shipment Over Rafah Invasion Warning

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Netanyahu

Amidst escalating tensions between Israel and the United States, Israeli Prime Minister Benjamin Netanyahu has adopted a defiant stance following the US decision to halt a shipment of bombs and warned against Israel’s potential invasion of the southern Gaza city of Rafah.

In a bold statement, Netanyahu declared, “If we have to stand alone, we will stand alone,” emphasizing Israel’s resolve to pursue its objectives despite opposition.

The Prime Minister’s comments, delivered via social media and a subsequent interview with American talk show host Dr. Phil, underscore Israel’s determination to address security threats posed by the Gaza Strip, particularly by Hamas militants operating in Rafah.

Netanyahu reiterated the necessity of military action in Rafah to eliminate the remaining Hamas battalions, condemned Hamas’s history of violence and reiterated Israel’s commitment to achieving victory and ensuring the safety of its citizens.

The US administration, led by President Joe Biden, expressed concerns over the potential humanitarian impact of an Israeli invasion of Rafah, prompting the decision to withhold additional offensive weapons shipments to Israel.

Biden’s statement echoed broader international apprehensions about the escalation of violence and civilian casualties in the conflict-stricken region.

However, Netanyahu remained resolute in Israel’s approach, asserting the country’s right to defend itself against security threats. He emphasized Israel’s efforts to minimize civilian casualties and facilitate the evacuation of civilians from Rafah before any military action.

Despite the US’s decision to pause the bomb shipment, Netanyahu affirmed Israel’s commitment to its longstanding alliance with the US. He acknowledged past disagreements between the two nations but expressed optimism about resolving current tensions through dialogue and cooperation.

In response, White House officials reiterated the US’s support for Israel’s security while urging restraint and emphasizing the need to avoid actions that could exacerbate the humanitarian crisis in Gaza.

The administration clarified that the decision to halt the bomb shipment was aimed at preventing potential civilian casualties in Rafah.

The confrontation between Israel and the US underscores the complexity of navigating regional conflicts and balancing strategic interests. As tensions persist, both nations face the challenge of reconciling their respective security imperatives with broader humanitarian concerns, seeking to avert further escalation while addressing the root causes of the conflict in the Middle East.

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EFCC Declares Former Kogi Governor, Yahaya Bello, Wanted Over N80.2 Billion Money Laundering Allegations

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Yahaya Bello

The Economic and Financial Crimes Commission (EFCC) has escalated its pursuit of justice by declaring former Kogi State Governor, Yahaya Bello, wanted over alleged money laundering amounting to N80.2 billion.

In a first-of-its-kind action, the EFCC announced Bello’s wanted status in connection with the alleged embezzlement of funds during his tenure as governor.

The commission, armed with a 19-count criminal charge, accused Bello and his cohorts of conspiring to launder the hefty sum, which was purportedly diverted from state coffers for personal gain.

The declaration of Bello as a wanted fugitive came after a series of failed attempts by the EFCC to effect his arrest.

Despite an ex-parte order from Justice Emeka Nwite of the Federal High Court, Abuja, mandating the EFCC to apprehend and produce Bello in court for arraignment, the former governor managed to evade capture with the reported assistance of his successor, Governor Usman Ododo.

This latest development shows the challenges faced by law enforcement agencies in holding powerful individuals accountable for their actions.

However, it also demonstrates the unwavering commitment of the EFCC to uphold the rule of law and ensure that justice is served, irrespective of the status or influence of the accused.

In response to the EFCC’s declaration, the Attorney General of the Federation and Minister of Justice, Lateef Fagbemi, issued a stern warning to Bello, stating that fleeing from the law would not resolve the allegations against him.

Fagbemi urged Bello to honor the EFCC’s invitation and cooperate with the investigation process, saying it is important to uphold the rule of law and respect the authority of law enforcement agencies.

The EFCC’s pursuit of Bello underscores the agency’s mandate to combat corruption and financial crimes, sending a strong message that individuals implicated in corrupt practices will be held accountable for their actions.

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Concerns Mount Over Security as National Identity Card Issuance Shifts to Banks

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NIMC enrolment

Amidst the National Identity Management Commission’s (NIMC) recent announcement that the issuance of the proposed new national identity card will be facilitated through applicants’ respective banks, concerns are escalating regarding the security implications of involving financial institutions in the distribution process.

The federal government, in collaboration with the Central Bank of Nigeria (CBN) and the Nigeria Inter-bank Settlement System (NIBSS), introduced a new identity card with payment functionality, aimed at streamlining access to social and financial services.

However, the decision to utilize banks as distribution channels has sparked apprehension among industry stakeholders.

Mr. Kayode Adegoke, Head of Corporate Communications at NIMC, clarified that applicants would request the card by providing their National Identification Number (NIN) through various channels, including online portals, NIMC offices, or their respective banks.

Adegoke emphasized that the new National ID Card would serve as a single, multipurpose card, encompassing payment functionality, government services, and travel documentation.

Despite NIMC’s assurances, concerns have been raised regarding the necessity and security implications of introducing a new identity card system when an operational one already exists.

Chief Deolu Ogunbanjo, President of the National Association of Telecoms Subscribers, questioned the rationale behind the new General Multipurpose Card (GMPC), citing NIMC’s existing mandate to issue such cards under Act No. 23 of 2007.

Ogunbanjo highlighted the successful implementation of MobileID by NIMC, which has provided identity verification for over 15 million individuals.

He expressed apprehension about integrating the new ID card with existing MobileID systems and raised concerns about data privacy and unauthorized duplication of ID cards.

Moreover, stakeholders are seeking clarification on the responsibilities for card blocking, replacement, and delivery in case of loss or theft, given the involvement of multiple parties, including banks, in the issuance process.

The shift towards utilizing banks for identity card issuance raises fundamental questions about data security, privacy, and the integrity of the identification process.

With financial institutions playing a pivotal role in distributing sensitive government documents, there are valid concerns about potential vulnerabilities and risks associated with this approach.

As the debate surrounding the security implications of the new national identity card continues to intensify, stakeholders are calling for greater transparency, accountability, and collaboration between government agencies and financial institutions to address these concerns effectively.

The paramount importance of safeguarding citizens’ personal information and ensuring the integrity of the identity verification process cannot be overstated, especially in an era of increasing digital interconnectedness and heightened cybersecurity threats.

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