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1MDB accuses WSJ of breaking M'sian law, wants probe
Published:  Sep 9, 2015 6:27 AM
Updated: 8:38 AM

1MDB today accused The Wall Street Journal (WSJ) of breaching Malaysian law after the US publisher reported claims that US$1.4 billion paid by the Malaysian state-owned fund to Abu Dhabi-based International Petroleum Investment Company (IPIC) had gone missing.

The troubled state-owned fund accused WSJ of using confidential information belonging to the Public Accounts Committee (PAC).

In its report today, WSJ revealed that it had obtained information belonging to a "parliamentary committee probing 1MDB".

"We are shocked that a hitherto reputable publisher such as the Wall Street Journal would make use of clearly confidential information in its reporting.

"We refer specifically to the WSJ confirming it has reviewed a 'transcript of the proceedings', from a parliamentary committee probing 1MDB, of which the only possible source is the Public Accounts Committee (PAC) hearings on 1MDB.

"The standing orders of the Malaysian Parliament very clearly states that 'the evidence taken before any select committee and any documents presented to such committee shall not be published by any member of such committee, or by any other person, before the committee has presented its report to the House'.

"The actions by WSJ are a potential breach of Malaysian law by a supposedly respectable foreign publication," 1MDB said in a statement today.

It added that it was worried those involved in the PAC hearing may have leaked information.

"We are further concerned as to who involved in the PAC hearings may have leaked this transcript, which is clearly an attempt to prejudice the PAC investigations and deny 1MDB its right to due process as provided for by the laws of Malaysia.

"1MDB strongly urges the relevant authorities to investigate this matter thoroughly and take all requisite action to preserve the process' integrity and standing orders of the Malaysian Parliament," it said.

Cited report yet to be made public

Aside from the hearing transcript, WSJ had also cited the interim auditor-general's report on 1MDB, which has yet to be made public but was submitted to the PAC.

Earlier today, WSJ reported the US$1.4 billion fund that had gone missing was from a 2012 deal between 1MDB and IPIC.

The fund was part of a deal where IPIC guaranteed US$3.5 billion in bonds issued by 1MDB, in exchange for a 49 percent stake in the latter's power assets and a collateral payment.

However, while the auditor-general's draft report on 1MDB's accounts showed that the collateral payment was made to IPIC's subsidiary Aabar Investments PJS, IPIC's own consolidated financial statements had no receipt of the payment.

The US financial daily said this was confirmed by two separate sources.

However, WSJ reported that a new management team at IPIC is now investigating the actions and relationship between their previous managers and 1MDB.

This revelation came amid reports that a rescue plan for 1MDB signed earlier this year where IPIC would inject funds into the troubled company was now likely to be aborted.

1MDB is struggling to repay its US$11 billion in debt or RM47 billion by now, due to the weakening ringgit.

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