KUALA LUMPUR, 23 March 2016:
Bank Negara Malaysia (BNM) governor Tan Sri Dr Zeti Akhtar Aziz says she will pursue administrative action against 1Malaysia Development Bhd (1MDB) during her remaining 38 days in the central bank.
She said BNM would like to see the rules and regulations complied with not only by 1MDB but other companies doing business in the country.
“I want to put a close to the 1MDB issue so that the next person will not need to deal with the matter. I want to hand over a clean slate,” she told a press conference in conjunction with the release of BNM’s 2015 Annual Report here today.
Zeti said BNM would submit recommendations for administrative action to be taken against 1MDB due to the non-compliance with the rules regarding their investments abroad.
She pointed out that the submission would be made to the Attorney-General (AG)’s Office.
The governor also said 1MDB had missed BNM’s deadline to provide supporting documents to show its overseas finances had been used to repay foreign debts and for restructuring programme.
“At this stage we have not received documentary evidence and within a certain timeline that has been stipulated to them.
“As we assess that they have not fully complied with our direction, we are pursuing appropriate administrative enforcement action as allowed by laws.”
On 19 Oct 2015, BNM had said in a statement that it could take enforcement actions, also known as administrative actions, on parties found to have transgressed or have not complied with rules and regulations issued under the Financial Services Act.
“These actions may be taken concurrently with, and are separate and distinct from, criminal proceedings that are under the sole purview of the AG. This is to ensure the integrity of, and confidence, in the financial system,” said the central bank.
To recap, on 9 Oct 2015, BNM announced that it has revoked three permissions granted to 1MDB under the Exchange Control Act 1953 (ECA) for its US$1.83 billion investments abroad.
The central bank had also issued a directive to 1MDB under the Financial Services Act to repatriate the amount back to Malaysia and submit a plan to the central bank for this purpose.
It concluded that after investigations 1MDB had obtained permission for its investments with inaccurate information or incomplete disclosure of material information.
The statement referred to the decision of the AG’s Chambers, which found that 1MDB officials investigated under the ECA did not make any false statements and cleared it of any wrongdoing.
It said the decision “relates to the bank’s recommendation to initiate criminal prosecution against 1MDB for breaches under the ECA.
Meanwhile, 1MDB said it is committed to continue its cooperation with BNM and will provide further information that may be required by the central bank.
In a statement today, 1MDB highlighted that it had, in the past 12 months, fully cooperated to the extent possible with BNM investigations, including providing documentary evidence where available.
“1MDB has not yet received any official correspondence or confirmation from BNM on the specific matters attributed to the governor today. We are, therefore, unable to comment further.”
1MDB earlier today completed the sale of its global assets under Edra Global Energy Bhd to CGN Group.
“We trust that this significant milestone and the associated debt reduction will not be overshadowed by the comments attributed to the governor of BNM.
“We further highlight that 1MDB remains focused on its rationalisation plan, the positive benefit of which was commented on by the ratings agency Moody’s today.”