Claiming 1MDB had doctored documents, Petaling Jaya Utara MP Tony Pua urged banks which provided loans to the company to check the financial statements provided to them.

 

He said the state investment company altered a single word in its March 2014 audited financial statement that was provided to the banks, thus giving a false impression that it had set aside US$1.22 billion (RM4.03 billion) from one of its investments to settle its debts.

 

He said a paragraph from page 93 of the certified-true copy of the financial statement obtained from the Companies Commission of Malaysia (SSM) reads:

 

"As at the date of this report, the amounts received from the redemption of investments of US$1.22 billion (RM4.03 billion) in the (segregated portfolio company) above have been substantially utilised for the purposes of debt interest payment, working capital and payments to Aabar as refundable deposits pursuant to a Settlement Agreement to extinguish the Options Agreement as disclosed in Note 41(ii)(j)."

 

However in the allegedly doctored document, Pua claimed the word "substantially utilised" was altered to "substantially set-aside".

 

"I call upon all lenders to 1MDB to peruse through the financial statements with a fine-toothed comb to discover all discrepancies between the original copy lodge with SSM, and the doctored copy in their hands […]

 

"If discrepancies are found with the financial statements as I have alleged, I call upon the banks to immediately file police reports to protect their interest and that of their shareholders," he told a press conference in Kuala Lumpur today.

 

Pua said he would run afoul with the Banking and Financial Institutions Act 1989 like Pandan MP Mohd Rafizi Ramli ( photo ) had done before if he provided reporters with evidence of the tampering, and was evasive when queried if he has the evidence at hand.

 

However, he said he wouldn’t have made such an allegation that would be easily disproven unless he was confident of its veracity.

 

“I am happy to be disproved, and be humiliated if proven wrong,” he said.

 

The DAP publicity chief did not disclose the bank that had been provided with the allegedly doctored documents, but instead cited publicly available information to point out that 1MDB owes Maybank, RHB Bank, Alliance Bank, and HwangDBS Bank RM3.5 billion, and said that other banks like Ambank and Affin bank are also at risk.

In a statement later today, 1MDB slammed Pua for making unsubstantiated allegations regarding the company, saying that such statements impacts the company’s operations and affects its restructuring plan.

 

'Ensure documents are valid'

Meanwhile, Pua said he believes that his is not the only instance of doctoring that 1MDB had done.

 

He expressed concern that documents provided by 1MDB to the auditor-general in its probe may have been altered as well.

 

“The auditor-general would have to be ultra-careful with documents provided by 1MDB to ensure that they are valid and not tampered with.

 

“If they were, then the conclusions could be very different from what it would arrive at, at the end of the report,” Pua said.

 

Auditor-general Ambrin Buang ( photo ) is currently aiming to table an audit of 1MDB to Parliament by the end of the year.

 

On Thursday last week, he had presented an interim report to the Public Accounts Committee (PAC), of which Pua is a part of.

 

According to Ambrin, his office is still waiting for 1MDB to provide some documents that it has requested, while 1MDB later said it has provided all documents requested and will contact the auditor-general to enquire what other documents it is looking for.

 

Breach of warranty

PAC chief Nur Jazlan ( photo ) was reported to have said that the audit did not uncover anything suspicious so far, but clarified on the next day that he did not make such statements.

 

A source with knowledge of the report had also told Malaysiakini that the audit had found that 1MDB’s management frequently made investment decisions without informing its board of directors, and on had on many occasions provided the board with incomplete or inaccurate information.

 

Meanwhile according to Pua, the alleged doctoring of documents are tantamount to a breach of warranty by 1MDB, which under typical loan agreements, would trigger an ‘event of default’.

 

This means all debts owed by 1MDB would immediately become due and payable, Pua said.

 

However, he conceded that he has no access to 1MDB’s loan agreement, but stressed that this feature is typical of most loan agreements.

 

In addition, Pua said the doctoring of financial statements is an offence under Section 477A, which deals with the falsification of accounts.

 

The offence in punishable with up to seven years of imprisonment, a fine, or both.

In its statement, 1MDB countered Pua by saying that dealings with its bankers are governed by contracts and national laws - including confidentiality obligations - but points out that that none of its lenders have declared an event of default for the reasons that Pua stated.

Related reports

Dr M: Blowing whistle on PM courts trouble

Concealing evidence is abetment, warns Dr M

Najib will survive, says ex-pol sec

1MDB – shift focus from whistleblowers, gov't told

1MDB slams Pua for making 'damaging' claims

1MDB doctored financial statement, claims Pua

'Najib must quit' – cops record Loke's statement

Husni: Interim report shows 1MDB in the clear

Cops to probe all parties over leaked documents

Kudos to the 1MDB duo who stepped down

IGP chases after ‘ghosts’ rather than criminals

Nobody is saying Rosmah's money is illegal...

PM, wife to declare assets? Not in a million years