Probe if Najib was 1MDB puppet master, says think-tank

Modified 8 Apr 2016, 6:36 am

A think-tank has urged the authorities to determine if Prime Minister Najib Abdul played the role of a "shadow director" in 1MDB, exerting his influence from behind the scenes.

"I urge the authorities to look into the concept of shadow directorship.

"The powers and influence of the prime minister in his capacity as chairperson of the board of advisors must be examined to ascertain if he has acted in any way as a shadow director.

"Otherwise the investigation will be incomplete," said Institute for Democracy and Economic Affairs (Ideas) chief executive officer Wan Saiful Wan Jan.

He also criticised the practice of appointing a sitting prime minister as chairperson of a government-linked company (GLC), describing it as the "stupidest" and most "ridiculous" governance structure ever.

"From a governance perspective, appointing the prime minister as chairperson of the advisory board is the stupidest idea anyone can come up with," he added in a media statement.

Wan Saiful said this in support of the Public Account Committee's recommendation for the 1MDB advisory board to be abolished.

"All along, I have been saying that this is 1MDB's biggest weakness," he stressed.

He argued that a serving prime minister, who is arguably the most influential man in the country, would certainly pose the risk of undue influence upon those sitting on GLC boards and in management.

"This is a person whose advice even the Yang di-Pertuan Agong is compelled to follow. Will it really be possible for any of the directors to decline his advice?

"No wonder some people are beginning to suggest that the former (1MDB) CEO ignored his board of directors because he is following instructions from someone more powerful.

"When the governance structure is as ridiculous as that, we cannot stop people from making all sorts of allegations," he argued.

Noting that the PAC report is critical of 1MDB's governance, Wan Saiful also said he is glad that the 1MDB board of directors have offered their resignation.

"They should all go. The blame should not be put on one person but the whole board is responsible and must be made accountable," he added.

Wan Saiful also said since the report highlighted how poor the governance of 1MDB has been, there is concern with regard to all the other national and state GLCs.

"Will they pass the test, or will we discover a hundred more mini-1MDBs?

“If we now decry a debt of RM50 billion, how do we know whether there are not 100 GLCs at the state and federal levels each with debts of just 1 percent of that?" he asked.

Wan Saiful said that a comprehensive review of corporate entities owned by the federal and state governments must be done.