Government help to aining companies an excuse for financial hand-out to troubled companies associated with Barisan Nasional, and in particular UMNO, leaders?

by Parliamentary Opposition Leader, DAP Secretary-General and MP for Kota Melaka, Lim Kit Siang, in Petaling Jaya on Sunday, 1st June 1986:

Government help to aining companies an excuse for financial hand-out to troubled companies associated with Barisan Nasional, and in particular UMNO, leaders?

After last Wednesday’s Cabinet meeting, Cabinet spokesman Datuk Rais Yahim announced that the government is looking into ways of assisting companies that are adversely affected by the present slowdown.

This announcement has disturbed many Malaysians, for they wonder whether this would be used as an excuse for the government to use public funds to help out troubled companies associated with Barisan Nasional, in particular UMNO, leaders.

There is justification for such worry and concern, for in the last four years, there seems to be no clear distinction between the government on the one hand, and private business ventures on the others. As a result, there has been widespread allegations of conflict of interest involving top government leaders. The current controversy over the two MBC transactions involving the Finance Minister, Daim Zainuddin, and his family companies, is a good example.

It is well known that many companies, which were high-flyers until recently, which were all involved with top Barisan Nasional, and in particular UMNO leaders or their associates, are now in trouble. Are these the companies the Cabinet want to help with public funds?

I will caution the Cabinet not to use public funds to bail out the private businesses of well-connected Barisan and in particular, UMNO leaders and their friends, for this will only shatter public confidence in the integrity and credibility of the public leaders. For instance, is the Cabinet thinking of using public funds to help out companies associated with the Deputy Prime Minister, Ghaffar Baba, and Finance Minister, Daim Zainuddin, before they were appointed to the Cabinet? Or the companies associated with the MCA President, Tan Koon Swan, and other big-time Barisan or UMNO election fund contributors?

Recently, the Prime Minister, Datuk Seri Dr. Mahathir Mohamed said there are about 900 government companies losing money or doing badly.

What is also disturbing is that some companies could become transformed from one identity to another depending on different circumstances. MAMINC is one such company. It was registered as a company with a $2 paid-up capital on 23rd June 1981, and was rumoured to be the vehicle responsible for the mysterious tin-buying in the London market which started in July 1981, and ended in February 1982. The mysterious tin-buying operation, to corner the world tin market and jack up tin prices, was a complete failure, and the losses incurred was estimated to be $1 billion.

Who lost this $1 billion? Even more important, if the tin-hoarding operation had succeeded, who would have profited from the fortunes?

I have just recently caused a search to be made in the Registry of Companies, and found that MAMINCO had not submitted any annual returns at all since its incorporation in 1981.

From a private company, it suddenly become a ‘government department’, when in the 1985 Telephone Directory, it was listed under the Ministry of Finance departments. Recently, the Parliamentary Secretary – to the Ministry of Energy, Post and Telecommunications, Au Howe Cheong, said that the 1986 Telephone Directory is being held back because of many errors. I understand that the re-appearance of MAMINCO under the Finance Ministry was the real ‘mistake’, and the 1986 Telephone Directory is being corrected to remove MAMINCO from the Ministry of Finance.

MAMINCO apparently took huge loans from Bank Bumiputra. This was revealed by the voluminous exhibits submitted by the Ahmad Nordin BMF Inquiry Committee. Thus Volume I of the exhibits of Special Brief Part III gave notes of a meeting between the then Bank Bumiputra Chairman, Dr. Nawawi bin Mat Awin, and the then Governor of Bank Negara, Tan Sri Aziz Taha on November 12, 1982, which stated:

“9. In reply to Governor’s query, Dr, Nawawi said that Bank Bumiputra’s overseas branches were lending to BMF, since for funding operations, it was just treated as a branch. However, for lending operations, it was an independent entity. Bank Bumiputra’s London branch was lending about US$200 million to BMF, while its Singapore branch was lending about US$100 million. He added that there were no problem loans at the overseas branches, although Bahrain branch may have a problem on its loans to MAMINCO.”

It is time the Malaysian government tell the full story about MAMINCO and the mysterious tin-buying in 1981, whether the $1 billion loss was borne by the Malaysian taxpayers eventually.

According to the Registry of Companies Records, the two directors of MAMINCO when it was incorporated in 1981 were

(a) Abdul Rahim Aki,
31 Jalan Langgak Golf, Kuala Lumpur;

(b) Faisol Haji Siraj,
89, Lorong Setiabistari,
Damansara Heights, KL (chartered accountant).

The nature of business in the Registry records were given as “to undertake commodity and minerals trading”.

Bank Bumiputra should also explain what is the present position of the bank’s loans to MAMINCO.

In a book published in the United States last year, dealing with international metal trading, the 1981 mysterious tin-buying operation was mentioned, and Dr. Mahathir and Tengku Razaleigh were described as being directly involved in the mysterious tin-buying. Both Dr. Mahathir and Tengku Razaleigh owe the Malaysian public a full statement on their role in the mysterious tin-buying operation in 1981, which took place in the early days of Dr. Mahathir becoming Prime Minister.