DAP Petaling Jaya Utara MP Tony Pua has questioned how 1MDB made its “equivalent” of US$350 million payment to International Petroleum Investment Company (IPIC).

“How did 1MDB get its money in Malaysia?

“By all public pronouncements from 1MDB and by ministers in Parliament, 1MDB certainly doesn’t have “the equivalent of US$350 million” or nearly RM1.5 billion in cash sitting around in its local bank accounts,” Pua said in a statement today.

He recalled an announcement made by 1MDB in April this year about the IPIC settlement where the Finance Ministry-owned firm said that the company’s “obligations will be met by 1MDB, primarily via monetisation of 1MDB-owned investment fund units”.

These investment fund units, he said, were held in the now-defunct BSI Bank in Singapore, and its last known value of the balance of the units was US$940 million.

Thus, the question remains, if the source of the “equivalent of US$350 million” came off the sale of these units overseas, the investment disposal proceeds should be in US dollars, he said.

However, he pointed out that 1MDB’s use of the word “equivalent” of US$350 million, instead of a straightforward “US$350 million” implies that the payment was not remitted in US dollars.

“Perhaps in this case (it was) in ringgit Malaysia?

“Does this mean that 1MDB circumvented its US dollar remittance 'technical problem' with Bank Negara granting approval for the remittance to be issued from Malaysia in ringgit, or any other non-US dollar currency?” he questioned.

He also pointed out that 1MDB had said that “all funds paid to IPIC are from proceeds of the on-going rationalisation programme”.

It is important, he said, to make an inference from what is not stated, beyond what is actually stated.

“Notice how in the current statement, 1MDB no longer makes any reference to the “monetisation of the 1MDB-owned investment fund units”, which was previously included in all of 1MDB’s past responses on the issue, including two separate Finance Minister’s replies to me in Parliament,” he said.

If the equivalent of US$350 million did not come from the proceeds of the units’ sale, then where did the money come from, as 1MDB has sold and transferred all of its assets, he said.

“Hence, the US$350 million question now is, did this money come from the Finance Ministry, directly or indirectly via some convoluted “rationalisation” scheme?

“1MDB and Prime Minister Najib Abdul Razak must come clean on the matter, especially since 1MDB has another US$300 million and US$603 million to pay by 31 Aug and 31 Dec respectively,” he said.

It was reported yesterday that 1MDB had made a partial payment of US$350 million to IPIC.

IPIC subsequently confirmed in a statement to the London Stock Exchange that it had received payment but did not mention any figures.

1MDB owes IPIC US$603 million plus interest as part of a settlement for arbitration proceedings between both parties and MOF Inc.

The payment was originally due on July 31.

However, 1MDB failed to honour its commitment, forcing Abu Dhabi’s sovereign wealth fund to give 1MDB a grace period of five days to make the payment, which the company also missed.

The next deadline for 1MDB to meet its financial obligations to IPIC is on Aug 31.