The interest of banking and finance in Malaysia calls for a complete clearing of the air on the BMF affair

Speech by Parliamentary Opposition Leader, DAP Secretary – General and MP for Kota Melaka, Lim Kit Siang, at the Malacca DAP 17th Anniversary Thousand- People Dinner held at Pay Fong Chinese Independent Secondary School Hall Malacca on Sunday, 24.7.1983 at 8 p.m.

Dr. Mahathir’s Two- Years- as Prime Minister Interview

The interest of banking and finance in Malaysia calls for a complete clearing of the air on the BMF affair

In his Two- Years- as- Prime- Minister interview, Dr Mohamed said that if there were any malpractices involved in the billion- dollar Bumiputra Malaysia Finance loans in Hong Kong, the Government would have no hesitation about taking action.

While I welcome the Prime Minister’s statement that action would be taken against those involved in malpractices or corrupt practices related to the BMF loans, I am unhappy that seven months after the Bank Negara as well as the Bank Bumiputra head office had conducted investigations into the BMF scandal, the Prime Minister is still talking in terms of ‘Ifs’ and ‘woulds’.

I would have thought that after seven months of high- level investigations into the BMF affair, the Government should be in a position to know whether there had been malpractices, especially at international press had been rather explicit in naming certain Bank Bumiputra and BMF officials as being involved in certain transactions which clearly conflict with their responsibility to the Bank and the BMF.

What is even more upsetting is that these officials had been allowed to remain in their old positions, although allegations of improper practices involving them had not been cleared or denied publicly, which could only hamper and obstruct through investigations.

When the BMF loans scandal first broke, the government leaders had at first used as the need to protect the public confidence in the banking community as the reason for keeping ‘mum’, and evading their public responsibility of accountability to tell the people the full facts of the case.

The people and country were promised that at the annual general meeting of the Bank Bumiputra in June, the full story of the BMF loans would be told. Instead, the country was treated to the spectacle of the Bank Bumiputra Chairman, Dr. Nawawi Mat Awin and other Board Directors absenting themselves from the post-AGM press conference when their Bank Bumiputra Annual Report made history of sorts by concealing, rather than revealing, about the BMF loan troubles.

The cold-blooded murder of Jalil Ibrahim in Hong Kong while pursuing the BMF loan scandal has added gravity to the whole matter, for it shows to the public that in the last seven months, there had been a well- orchestrated campaign to hide the facts of the BMF loan scandal from the public.

I believe we have reached a stage, with the killing of Jalil Ibrahim, where it is in the long- term interest of banking and finance community and public confidence in them that the Government must come out and clear the air on the BMF affair, make a clean breast of it, in terms of what are the total loans involved in Hong Kong, and as at this moment of time, what percentage of such loans are expected to be recoverable and what percentage are likely to be lost.

In view of the Government’s full backing to Bank Bumiputra, such a frank statement of the BMF woes would not cause any repercussions. On the other hand, the continuation of the present policy of keeping mum on the BMF affair, despite the post-AGM press conference fiasco and the Jalil Ibrahim murder, could only undermine public confidence in the integrity and competenoe of these responsible for the banking and finance community in the country. This could lead to serious repercussions, for once confidence is undermined, serious consequences can follow;

Already, Bank Bumiputra officials themselves are unhappy over the Bank’s handling of the BMF affair, As reported in the press yesterday, one Bank Bumiputra official commented that the Bank Bumiputra report ‘did not tell everything’ and asked whether the management had to wait for a death of one of its officers to step up investigations. These are all very unhealthy.

Parliamment’s meeting tomorrow is the best occasion for the Government to clear the air on the BMF affair, and restore full confidence in the integrity and competence in the overall management of banking in the country.

The Prime Minister’s House: not a fitting symbol of an efficient and trustworthy government

In his interview, Dr. Mahathir said that the new $10 million Prime Minister’s House that is being built was beyond his control, and that he was told that he could not determine how future Prime Ministers should live.

I find Dr. Mahathir’s explanation most strange, for if as Prime Minister, he could not put his foot down and have his way about the type of Prime Minister’s Residence that should be built, it makes one wonder how he could get his way with the entire government bureaucracy of 700,000 civil servants to conform with his ‘clean, efficient and trustworthy’ motto.

In agreeing to a $10 million Prime Minister’s Residence to be built, Dr. Mahathir is in fact determining that future Prime Ministers must stay in $10- million Residences.

Following the example of Dr. Mahathir, State Mentri Besar and Chief Ministers cannot be faulted if they also insist that they should stay in million- dollar residences themselves.

Dr. Mahathir does not solve the problem of the $10 million Prime Minister’s residence by saying that he would not live there if the public thinks he shouldn’t move in. The question is why he allowed such a residence to be built.

Call on Ministers and State Exco Members to publicly declare their assets

In his interview, Dr. Mahathir said that despite his directive two years ago, there are still State Exco Members who are still doing business. In actual fact, the 2M Government’s anti- corruption campaign has not much credibility, as the public see corruption becoming rampant and part of Malaysian public life again.

There can be no effective war against corruption unless the political leaders set an example of incorruptibility, by publicly declaring their assets, whether for Ministers or State Exco Members.

Yesterday, the people read in the press of a Minister who reported loss of three watches from his house, the total value of which is some $46,000. This is the total household income of a poor farmer for over 20 years.

Despite its change of name from National Bureau of Investigations to Anti- orruption Agency, the ACA has not distinggished itself as a more effective body which could put the fear into the corrupt among the politically powerful.

Dr. Mahathir, if he is committed to clean up Malaysian public life of corruption, must review the corruption laws and anti- corruption instruments, so that anti- corruption campaign of the government would result in the prosecution of the sharks, instead of netting the ikan bilis only.