The Finance Ministry denied the allegation that 1Malaysia Development Bhd (1MDB) president and executive director Arul Kanda had obtained falsified bank documents.

"(The allegations) on Arul Kanda that he obtained the financial statements, not owned by BSI (a bank in Singapore), are not true," the ministry said in a one-liner parliamentary written reply to Mohamad Ariff Sabri Abdul Aziz (DAP-Raub), dated May 20.

Mohd Ariff questioned how Arul obtained financial statements which donot belong to BSI Singapore, a Swiss bank located in Singapore.

"If the bank statements are falsified and not from BSI, then obviously it's 'falsification of documents'.

"Does this not expose 1MDB to legal implications from BSI?" Mohd Ariff ( photo ) asked.

On April 22, whistle-blower website Sarawak Report cited leaked investigation papers that claimed 1MDB had submitted false bank statements concerning Brazen Sky Ltd.

"The account merely contains 'paper assets', the true value of which cannot be determined," the report, said basing this on an anonymous source.

The US$2.3 billion (RM7.4 billion) invested in Cayman Islands, was managed by Bridge Partners, a Hong Kong-based firm.

The investment was allegedly made through Brazen Sky Ltd, another little-known company incorporated in the British Virgin Islands, which like the Cayman Islands is a known tax haven.

Yesterday, the Finance Ministry corrected its parliamentary written reply issued in March that said the US$1.1 billion (RM3.97 billion) transferred by 1MDB from Cayman Islands to Singapore was in cash.

The ministry said the money that was "redeemed" was in the form of assets in US dollars.