It's time to call the ghostbusters to exorcise the spectres haunting the mega-financial scandals involving the government under former prime minister Dr Mahathir Mohamad.

As more and more scandals creep out of the woodwork - the latest involving former MAS chief Tajuddin Ramli - Opposition Leader Lim Kit Siang has demanded a royal commission be set up to probe them.

He wants the independent commission to investigate the RM1.8 billion Tajuddin-MAS bailout, RM30 billion Bank Negara forex (foreign exchange) losses and other financial scandals in the past two decades.

"The time has also come to 'exorcise the ghost' of the RM30 billion Bank Negara forex losses more than a decade ago, especially as the person who played such a pivotal role in the scandal is none other than Nor Mohamed Yakcop, the second finance minister," he said in a statement today.

"Up to now, the government has failed to 'come clean' on the colossal losses as a result of speculation in the international currency markets from 1992-1994, with losses cited as ranging from RM10 billion to RM30 billion."

The veteran opposition leader said his estimation of the losses were "as high as RM30 billion", and this had not been seriously rebutted by any top government leader.

Lim claimed that Bank Negara's maximum exposure at the height of its forward foreign exchange speculation was in the region of RM270 billion - three times the country's GDP and more than five times the country's foreign reserves at the time.

Tajudin's bombshell

Last Saturday, one-time corporate high-flyer Tajudin filed a RM13.46 billion counter-suit in response to a suit by then national asset management company Danaharta - set up to deal with non-performing loans - against him to recover RM589 million of outstanding loans.

In the suit, he made a number of shocking revelations involving his acquisition of 32 percent stake in the national carrier MAS in 1994 and the RM1.8 billion sell-back of the shares to the government six years later at an inflated price.

According to The Sun today, Tajudin made the following claims in his affidavit:

  • He was directed by Mahathir and former finance minister Daim Zainuddin to buy shares in MAS to help Bank Negara recover from foreign exchange losses in 1994.

  • The transaction was a 'national service' but was disguised as an arm's length commercial deal because the government wanted it that way to appease the investment community and the public.

  • He was at all times only a nominee/agent of the government in MAS.

  • He was assured repeatedly by Mahathir and Daim that he would not suffer any losses or be held liable for anything arising from his purchase of the MAS shares.

    • He was asked to keep this special arrangement a secret. He is telling all now because the government did not honour the agreement.

    According to Lim, the revelations "answered many questions which had been asked in and out of Parliament for the past decade".

    "The Tajudin litigation has raised afresh many good governance and public interest questions which cannot continue to be avoided if the (Prime Minister) Abdullah (Ahmad Badawi) premiership is not to be tarred with the brush of colluding and conniving in their cover-up," he said.

    Lim targets Daim too

    The opposition leader also charged that Daim had committed parliamentary contempt when he deliberately deceived Parliament in answering a question on the scandal on March 21, 2001

    According to Lim, the then second finance minister made the following claims:

    • He suggested the RM8 per share for Tajudin's MAS stake was the best price possible in national interest.

  • That Tajudin was a "reluctant seller" at RM8 per share when the market price was RM4.32.

  • He gave the impression that Tajudin was quite reasonable in wanting to release his MAS stake to the government at not less than RM15 and that there was foreign investor interest in MAS at this price.

    • Lim said that Daim's answer was "most outrageous" as Tajudin had told a foreign news agency when the deal was concluded that he was lucky to get a good price of RM8 a share to enable him to settle his company Naluri's entire debt of RM927.4 million, while the balance of RM864.5 million would go to new business ventures. In the meantime, the money would be placed in banks to earn RM24.2 million a year.

    Lim said the current Parliamentary Privileges Committee is studying whether it has jurisdiction to deal with the gross breach of parliamentary privileges committed by Daim in the previous parliament.