Press statement by Parliamentary Opposition Leader, DAP Secretary-General and MP for Kota Melaka, Lim Kit Siang, in Petaling Jaya on Saturday, 3.11.1984
BMF inquiry committee interim report a ‘great let-down’
The reaction of all Malaysians to the Ahmad Nordin BMF inquiry committee interim report must be one of great letdown and disbelief.
They had all looked forward to the Ahmad Nordin committee interim report to answer at least some of the many questions which had swirled in their minds since the bubble of the BMF loans scandal burst at the end of 1982, but the Ahmad Nordin committee interim report has not taken the sordid financial scandal any much further and the public are not any more wiser about the Whos, the Hows and Whys of the scandal.
The first question that springs to mind is: Is this all that the Ahmad Nordin Inquiry Committee could report on after seven months’ of work?
The interim report dealt with only one of the eight terms of reference of the BMF scandal, which is the ‘extent and nature of loans or credit facilities granted by BMF’ to Carrian Group and Eda Investments Ltd.
In actual fact, this term of reference was given nine paragraphs, as the rest of the interim report was about the history and structure of BMF, the procedures of the Inquiry Committee, and the assignment of the BMF bad loans to Bank Bumiputera in the last day of the 1983 financial year.
The second question that springs to mind is that the nine paragraphs devoted to the ‘extent and nature of loans or credit facilities granted by BMF’ to Carrian Group and Eda Investments Ltd. Are Bank Bumiputera and BMF information which should be available to the inquiry committee in a matter of days’ request.
If the Ahmad Nordin inquiry committee had to take seven months just to find out about the nine paragraphs about BMF’s loans to Carrian and Eda, then clearly the committee was either not getting any co-operation from the Bank Bumiputera and/or BMF, or the Bank Bumiputera and/or BMF simply lack the/records/full about the extent of the loans or credit facilities granted to Carrian and Eda.
I can now appreciate even more the cry of despair by the Auditor-General, Tan Sri Ahmad Nordin, when after submitting the interim report, he went on public record calling for a Royal Commission of Inquiry as the only body with the necessary powers to establish if anyone is criminally liable in the BMF loans scandal and that it was still not too late for a Royal Commission of Inquiry to be set up.
If Tan Sri Ahmad Nordin, who is respected by all Malaysians for his integrity and impeccable reputation, could come out with such meagre fare after seven months’ for work, clearly something is very wanting in the form of BMF inquiry and the powers vested in the inquiry committee.
The third question that springs to mind is that if the Ahmad Nordin Inquiry Committee could produce such meagre fare after seven months of work, and only on one item of its eight terms of reference, could the people expect the Ahmad Nordin Inquiry Committee to find the answers to the various questions about the BMF scandal which all Malaysians are waiting for? Isn’t it time for the government and all concerned Malaysians to review whether the Auditor-General’s renewed call for a Royal Commission of Inquiry (taking over all the work that had been done by the inquiry committee) should be set up after all?
The Ahmad Nordin committee interim report has re-opened, and with even greater urgency and pertinence, the need to have a Royal Commission of Inquiry to inquire into all aspects of the BMF loans scandal.
My fourth impression is that the ‘interim report’ on the third term of reference about the ‘extent and nature of BMF loans and credit facilities’ to Carrian and Eda seem very ‘interim’ with the nine paragraphs devoted to it.
According to the books of accounts and documents of BMF made available to the Inquiry Committee, the total amount of loans and advances granted by BMF as at 31st December 1983, came to:
Carrian Group and Eda Investment Ltd. 6,133.3 1,841.9
Others 1,909.7 573.5
The people have a right to know why the BMF inquiry committee had been excluded from investigating into the loans amounting to $573.5 million, especially the third in the Hong Kong trio of BMF debtors, Kevin Hsu group. The exclusion of Kevin Hsu group from investigations becomes even more suspicious when it may have taken a greater sum than Eda group.
The failure of the Ahmad Nordin inquiry committee interim report to give separate loans figures for Carrian Group and Eda Investments Ltd. is a major defect.
However, according to the Hong Kong Prosecutor in a magistrate’s court on Oct.4/1983, the Carrian Group owe BMF at least M$1.7 billion. This would put Eda Investments at about $100 to $150 million. What is Kevin Hsu group’s share out of the M$573.5 million categorised as others’?
I would therefore call on the Government to direct the expansion of the scope of the Ahmad Nordin inquiry committee to include investigations of BMF loans to Kevin Hsu group; as well as to the rest of the balance of the loans.
The interim report on the BMF loans to Carrian and Eda are also unsatisfactory, for it fails to give particulars of the loans, as to whether they are secured or unsecured; the loans given to each separate company in the Carrian Group or Eda group of companies; whether securities have been used for more than one loan to the same company or associated company in the Group; etc.
From the interim report, the loans and advances which BMF made to Carrian and Eda for the respective years are as follows:
1979 -M$118.4 million
1980 -M$459.4 million
1981 -M$958.1 million
From these figures, which show the recklessness with which the BMF gave out its loans and advances to two companies, the question that begs an answer is how the Bank Bumiputera Executive Chairman, Dr. Mat Nawawi Awin, could claim innocence last month and declared that he had not approved or authorised any loan to Carrian or to any Hong Kong group as he became Bank Bumiputera chairman in April 1982? Is Mat Nawawi trying to suggest that someone higher than him authorised or approved the loans without his consent for the years 1982 and 1983?
The fifth impression is why the Ahmad Nordin Inquiry Committee is unable to make an interim report about the other items of terms of reference, in particular on whether there had been any misuse, misapplication or misappropriation of funds; whether the BMF loans were approved lawfully and in bona fide interest of BMF and consistent with normal prudent banking and commercial practice; the person or persons involved in the approval of the loans; whether any BMF director, officer, etc had received commission or improper gain from the loans; any irregularities, frauds or breahces of trust, or dishonest commercial practice or other breaches of the law.
All in all, the Ahmad Nordin Inquiry Committee must do better. If it is unable to carry out its terms of reference because of constraints of powers, terms of reference, or whatever reason, then it should state so publicly – for it is exercising a great national trust.