by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Petaling Jaya on Friday, July 5,1991:
The $72 million BBMB Securities Sdn. Bhd. losses is the third Bank Bumiputra scandal in less than 10 years
The $72 million BBMB Securities Sdn. Bhd. losses is the third Bank Bumiputra scandal in less than 10 years.
When the Government directed Petronas to bail out Bank Bumiputra after the $2.5 billion Bumiputra Malaysia Finance scandal, the people were assured that after the revamping of the Bank Bumiputra management, Bank Bumiputra would be put on a sound footing.
But in October 1989, I had to move a motion of urgent, definite public importance in Parliament on the Second Bank Bumiputra Scandal, involving another $1.1 billion Petronas ball-out because of a string of bad loans as bad as the first Bank Bumiputra scandal.
Now, there is a third Bank Bumiputra scandal because of irregular transactions in the securities arm of Bumiputra, the BBMB Securities Sdn. Bhd.
BBMB executive director Dr. Jaafar Ahmad said yesterday that appropriate action had been taken to report these irregularities, which happened between September 1989 to March 1990, to the relevant authorities.
The past record of ‘relevant authorities’ to check irregularities in the securities market, especially insider-trading, is nothing to inspire public confidence.
In fact, from the past record of these ‘relevant authorities’, it would appear that the stock exchange in Malaysia is peopled with saints, and there has never been any insider trading in Malaysia!
I am still waiting for the Finance Minister, Anwar Ibrahim, to answer my question which I posed in Parliament on 27th June on the outcome of investigations by the Registrar of Companies in connection with insider trading of the UMNO-related companies, namely United Engineers (M) Sdn. Bhd., Time Engineering and Kinta Kellas.
This question was directed to Anwar Ibrahim as Finance Minister because it comes under his jurisdiction, but it was shunted off to the Minister of Domestic Trade on the insupportable ground that administratively the Registrar of Companies is under the Ministry of Domestic Trade. Although Anwar said he was prepared to answer my question after my protest against such illegal shunting of my question, I am still waiting for Anwar Ibrahim’s answer to my question.
Call on Anwar Ibrahim to make a statement on the Singapore Business Times report that 42 people would be prosecuted for insider trading
The Singapore Business Times yesterday reported that 42 people are to be prosecuted for insider trading, with an announcement by the Malaysian Ministry of Finance on this imminent.
The Singapore Business Times said that one of Malaysia’s top banks is said to be involved and the misdeeds are said to have been uncovered during a routine check by Bank Negara officials. The amount involved is said to range between $100 to $180 million.
The Singapore Business Times said that very senior executives of the bank, government officials and other company directors are said to have benefitted from a massive share price-rigging scheme affecting public-listed Sungei Besi Mines.
The Singapore Business Times reported:
“Some time in April last year, Sungei Besi proposed to buy a 27 per cent stake in Tradewinds (Malaysia), a public-listed company with interests in plantation, insurance and sugar.
“The purchase was said to be paid with an issue of new Sungei Besi shares at $12 each, which only two months before had been trading at $6.
“There was absolutely no basis for Sungei Besi to trade at $12, certainly no asset backing even remotely close to that, analysts said.
“Obviously, there had been some massive price rigging. And the authorities did not like it one bit.
“The KL Stock Exchange issued a stern censure to Sungei Besi directors in July but not before Sungei Besi revised the value of its new shares down to $4.
“Not long after, the Malaysian Registrar of Companies and the Malaysian police were called in to investigate possible breaches of the Securities Industry Act.
“Adding further to the controversy, some three million Sungei Besi scrips which were reported ‘lost’ early last year.
“BBMB Securities failed to deliver these scrips to Kay Hian James Capel which had already placed out the shares to clients. Though BBMB later reimbursed KHJC for the loss, the mystery of the missing scrips remain.”
This will not be the first time that the Malaysian regulatory authorities had investigated insider trading and other irregularities under the Securities Industry Act, but will this investigation prove as fruitless as previous investigations?
I call on Finance Minister, Anwar Ibrahim, to make a statement on the Singapore Business Times report that 42 people would be prosecuted for insider trading.
Malaysians want to know why repeated revamping of Board and top management of Bank Bumiputra had not prevented repeated scandals in Bank Bumiputra
Malaysians are entitled to know the full scale and dimension of the third Bank Bumiputra scandal in less than 10 years.
The Singapore Business Times report has given a completely different picture from the account given by Dr. Jaafar Ahmad yesterday.
Dr. Jaffar also assured the public that the BBMB was fully committed to support BBMB Securities in all its obligations and commitments.
Dr. Jaffar must never forget that the BBMB had been fully purchased by the Government from Petronas last year, and the Bank Bumiputra Board and management owe the people of Malaysia full explanation of the third Bank Bumiputra scandal because public money is directly involved in it.
Malaysians want to know why repeated revamping of Bank Bumiputra Board and top management has not prevented repeated scandals in Bank Bumiputra!