Speech by Parliamentary Opposition Leader, DAP Secretary-General and MP for Kota Melaka, Lim Kit Siang, at the DAP Policy Review Conference official opening at Hotel Malaya, Kuala Lumpur, on Saturday, 26.3.1983 at 9.30 a.m.
Parliamentary Opposition Leader to seek meeting with Finance Minister, Tengku Razaleigh, over Asian Wall Street report about scandals about $1 billion Bumiputra Malaysia Finance loans to three Hong Kong companies.
Yesterday, the DAP MP for Bandar Kuching, Sdr. Sim Kwang Yang, unsuccessfully sought to adjourn Parliament to discuss a matter of urgent, definite public importance concerning the billion dollar loans made by Bank Bumiputra subsidiary, Bumiputra Finance Malaysia, to three Hong Kong companies which are now either facing liquidation or awaiting rescue operations.
The billion dollar loans made by Bumiputra Finance Malaysia to these three Hong Kong companies, namely Carrian group, the Eda Group and developer Kevin Hsu, are definitely of public interest because the monies involved are Malaysian public money.
On the second day of the parliamentary meeting on 5th March, I had asked the Finance Minister, Tengku Razaleigh, as to the losses Bank Bumiputra expected to incur as a result of the billion dollar loans to the three Hong Kong companies, but the Finance Minister evaded the question by stating that the Bank Negara had been direated to investigate into the matter.
However, the Asian Wall Street Journal, on its Friday-Saturday issue of 18th/19th March 1983 issue, carried a front-page article on the Bumiputra Finance Malaysia scandal, which cannot but raise in the public mind the vital necessity for a government clarification of the matter, instead of evading is the issue.
What is significant is that the Asian Wall Street Journal concerned was held up by the Home Affairs Ministry from release for five days, which is not only most unusual for a government which claims to be ‘liberal’, but signifies that after a five-day hold-up of the issue concerned, the government had no strong case to ban the paper for the article concerned.
This makes it even more imperative that the Asian Wall Street Journal article on the Bumiputra Malaysia Finance scandal should be clarified by the Government without undue delay, as would happen if the matter is left in the hands of Bank Negara. Public interest demands a public accounting for the actions of Bumiputra Malaysia Finance and its officials.
Thus, the Asian Wall Street Journal article reported that two days before Bumiputra Malaysia Finance lent US$40 million to the Eda Group belonging to property speculator Mr. Chung Ching-Man, on 10th Sept. 1981, a company belonging to a top official of Bank Bumiputera, Mohamed Hashim Shamsudin, received a HK $3.6 million cheque from the account of Mr. Chung Ching Man’s wife.
The Asian Wall Street Journal reported that Incik Hashim’s company, Silver Present, was incorporated in Hong Kong in January 1980 by a Hong Kong businessman with only two shares. In February 1980, the company was sold to Hashim’s wife. Margaret Rose Pinder, and Yeung Ka-wing, a local attorney who took ownership of one share each and became its only two directors. On Sept 5.1981, Mr.Yeung transferred his director’s position, but not his share, to Incik Hashim.
The Asian Wall Street Journal reported that on Sept.8, 1981, a cheque was drawn on the account of Mr. Chung’s wife for HK $3.6 million in favour of Silver Present, which was deposited the same day into an account at a Hong Kong Branch of China-owned Bank of Communications. Two days later, on Sept.10, Bumiputra Finance lent a subsidiary of Mr. Chung’s Eda Investments Ltd. US$40 million. The only collateral was 115 million Eda shares which are now virtually of no value as Eda went into liquidation with HK $2 billion in debts.
The Asian Wall Street Journal also reported that on the same day that Silver Present got the HK $3.6 million cheque, another private Hong Kong company, Knife & Dagger Ltd., received a cheque for the same account from the account of Mr. Chung’s wife. The Journal reported that the Hong Kong government records indicate that Knife and Dagger’s only shareholders were Carrian chairman, George Tan, and his secretary, Carrie Woo. Knife & Dagger was incorporated in November 1979. In January 1980, the company deposited HK$372,000 with Wing Lung Bank Ltd. to guarantee a banking facility for Ibrahim Jaafar, Bumiputera Malaysia Finance’s general manager. The Journal reported that at about the same time, Ibrahim also received a Hong Kong $1 million facility guaranteed by Carrian Holdings Ltd.
Carrian Group borrowed an estimated $600 – $700 million, from Bumiputera Finance Malaysia, and unless rescued, Carrian Group would be wound up.
A government which operates on the guidelines of ‘clean, efficient and trustworthy’ principles must be prepared to make an accounting to the public for expenditure / of public funds, including / or use funds in the hands of government companies or subsidiaries like Bumiputera Finance Malaysia.
I will seek a meeting with the Finance Minister, Tengku Razaliegh, to express to him the people’s concern over the Bumiputera Malaysia Finance affair, and in particular the Asian Wall Street Journal report, and to seek clarifications about the various disturbing reports concerned.