Malaysia has become a nation of scandals with corruption and abuse of power at high political places becoming a central issue in the coming general elections


Speech (Part ᴨ) by Parliamentary Opposition Leader, DAP Secretary- General and MP for Kota Melaka, Lim Kit Siang, at the DAP Penang Ceramah held at Penang Chinese Town Hall on Friday, 30th May, 1986 at 9p.m.

Malaysia has become a nation of scandals with corruption and abuse of power at high political places becoming a central issue in the coming general elections.

In the 1982 general elections, the Barisan Nasional promised the people a ‘clean effective and trustworthy’ government.

As the former Deputy Prime Minister and Deputy UMNO President, Datuk Musa Hitam, said recently, this was the rallying vry of the Barisan Nasional during the elections, and one reason for the Barisan Nasional’s landslide victory.

The Malaysian people did not expect the Mahathir Government to completely wipe out corruption, graft and abuse of power, but they expected the Barisan Nasional leadership to make the most serious effort in Malaysian history to declare war on corruption, graft and abuse of power, and all rank form of government unaccountability and irresponsibility. The Mahathir government should be the most corruption- free government when compared to the previous three governments under Tunku Abdul Rahman, Tun Razak and Datuk Hussein Onn.

Today, four years after the 1982 general elections, these hopes and promises have turned to ashes. In fact, I cannot remember any period in our 29-year years since Merdeka in 1957 have there been more rampant corruption, with widespread allegation of graft, abuse of power and government unaccountability and irresponsibility at the highest political places.

The present government has been rocked by one scandal after another, to the extent that a crisis of confidence has been created because Malaysia has become a nation of scandals.
BMF Scandal-Multi-headed hydra of scandals.

Leading the pack of scandals in Malaysia is the $2.5 billion Bumiputra Malaysia Finance (BMF) Scandal. The Barisan Nasional Government had hoped that after dumping the 15-volume, 6,000-page report of the BMF Ahmad Nordin Inquiry Committee in Parliament, this multi-headed hydra of scandals would just go away and disappear from public consciousness.

Malaysian who care about the integrity and accountability of government to the public, which constitutes the very essence of democratic politics, must not allow the BMF scandal to be buried away without the full story being told, and those really responsible for the theft and fraud of $2.5 billion of the Malaysian taxpayers’ money, brought to justice.

The extradition hearings of Lorraine Osman and Hashim Shamsuddin in London has re-opened the BMF scandal in Malaysia, and everyone is asking why the Malaysian authorities, and in particular the Attorney-General, has not initiated any criminal actions against the BMF criminals.

Malaysians still cannot understand why in his first major statement on the BMF Scandal on October 11,1983, the Prime Minister, Datuk Seri Dr. Mahathir Mohamed, had been double-quick to absolve everyone of criminal liability. True, Dr. Mahathir condemned the BMF scandal as a ‘heinous crime’, but said there were no criminals, for these were ‘moral wrongdoing’ which was within the law and could not be taken to court.

From this October 1983, statement it is clear that at this time, the Malaysian Government also did not want the BMF criminals to be prosecuted in the Hong Kong Courts or extradition proceedings in London for this purpose. The argument that the BMF crimes were committed outside Malaysia and outside the jurisdiction of Malaysia is also untenable, for the Prevention of Cr Corruption Act clearly provided powers for the Malaysian Courts to hear and try Malaysian for their corrupt practices abroad.

The Ahmad Nordin Inquiry Committee Laboured for two years, but to the Government, to no purpose, for the Committee’s recommendations for civil and criminal actions have been ignore if not rejected.

For instance, in its Special Brief Part ш, the Ahmad Nordin Inquiry Committee recommended action to be taken against Bank Bumiputra Board irectors for conspiracy to defraud the bank’s shareholders, breach of their judiciary duties and for offences and breaches of the Banking Act, Companies Act and false accounting under the laws of Malaysia.

Nothing has been done. But most important of all, the Committee’s recommendation that futher investigations into the BMF scandal be made was rejected out of hand.

The BMF scandal will haunt the Barisan Nasional in the coming general elections, because it is most powerful proof of the betrayal of the promise of a ‘Clean, Effective and Trustworthy’ Government.

But there is not just the BMF Scandal in the country. There is the UMBC Scandal involving the two transactions whereby the Daim Zainuddin family companies acquired first 41% control in 1984 and then 51% control in 1986 in the third-largest bank in Malaysia, UMBC, when in bith transactions Daim Zainuddin had already become Finance Minister.

The Prime Minister and Finance Minister had refused to come out with the full details of the two UMBC transactions to let the people judge the propriety, morality and even legally of both UMBC transactions.

Instead, the top Barisan Nasional leadership inspired the publication of an article in the New Straits Times, Berita Harian, Utusan Malaysia amd Shin Min Daily News, to rebut: the allegations leveled against Daim Zauinuddin, in particular over the UMBC deals.

I want to tell Dr. Mahathir and Daim Zainuddin that this article, ‘Daim- The Target?’ has not only failed to rebut the allegations of corruption or improprieties in high political places, it had brought the issue of corruption, abuses of power in high political places to the forefront of national politics. Thanks to this article, it will become a central issue in the coming general elections.

EPF Investments Board acting illegally in 1984 and 1985 without authority of the EPF Board ihn investments resulting in $10 million loss to contributors.

According to this special article, which is a semi- official acknowledgement about widespread allegations of corruption of corruption in high political places, apart from the UMBC allegations, there were also allegations involving Daim Zainuddin in connection with Redifussion and United Engineers.

There is also the EPF Scandal, where the EPF Investment Panel invested in 13 counters in the nine months from June 1984 to March 1985, and either on the same day or at longest two months later, sold 70 per cent in every instance to a company with a $2 paid up capital, MAKUWASA, forgoing profit of $10million which could have been credited to the five million EPF contributors.

In fact, under Section 4B of the Employees Provident Fund Act 1951, the EPF Investment Panel had acted illegally when it invested in the 13 share counters and caused the 5 million contributors to lose $10 million.

Section 4B (1) of the EPF Act reads:

“There shall be established an Investment of the assets of the Board which for matters pertaining to the investment of the assets of the Board which shall be subject to such directions issued by the Board which shall be subject to such directions issued by the Board and approved by the Minister from time to time.”

But is public knowledge that the EPF Board knew nothing about the investment policy or decisions of the EPF Investment Panel, which acted in disregard of the EPF Act, and therefore unlawfully.

Ten days ago, I had asked for an appointment to meet the Prime Minister, Datuk Seri Dr. Mahathir Mohamed, on the UMBC transactions and the EPF Investments, but the Prime Minister does not seem to be keen to talk to me on both issues, although they concern the integrity of the government.

PAN EL and Multi-Purpose Scandals.

In the midst of such scandals, the MCA does not want to be left out of the show and have their share of scandals, including the PAN EL Scandal and Multi-Purpose Holding Scandal involving MCA President, Tan Koon Swan.

Up to now, the Multi-Purpose Holding have refused to state whether the $15 million post-dated cheque of Tan Koon Swan, meant to be paid by 19th May, had been cleared.

The true story of the $23 million from Multi-Purpose Holding used by Tan Koon Swan last November in Singapore in the abortive Pan EL rescue bid has still to be told. Was Tan Koon Swan using the $23 million to save Pan EL, or Multi-Purpose or himself?

The Multi-Purpose Holding was published in 1981 before its public listing as a Chinese community project, and for this reason, the Multi-Purpose Holding Board of Directors have a public and moral responsibility to be fully accountable to the people, especially when there is suspicion of impropriety as in the $23 million transaction involving Pan EL.

MCA leaders and Ministers cannot claim to be models of a ‘clean, efficient and trustworthy’ commitment when they could not fully account to the people on the Pan El and Multi-Purpose scandals. Gerakan leaders cannot claim to be advocates of a ‘clean, efficient and trustworthy’ government when by the principle of collective responsibility, they are party to all these scandals and dare not make a stand against both UMNO and MCA leaderships that such scandals should not be hidden under the carpet.

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