1MDB lawsuit: MP says GLCs should terminate KPMG
Following a breakdown in negotiations over settlement for its role in the 1MDB scandal, Damansara MP Tony Pua said the government should remove KPMG Malaysia as an auditor in any company where the government has direct shareholder control.
In addition, he said KPMG should be excluded from participating in government tenders until a lawsuit over the matter has been resolved.
This was because it has become clear KPMG is unwilling to accept the government’s demands, Pua (above) said, unlike another...
Following a breakdown in negotiations over settlement for its role in the 1MDB scandal, Damansara MP Tony Pua said the government should remove KPMG Malaysia as an auditor in any company where the government has direct shareholder control.
In addition, he said KPMG should be excluded from participating in government tenders until a lawsuit over the matter has been resolved.
This was because it has become clear KPMG is unwilling to accept the government’s demands, Pua (above) said, unlike another former 1MDB auditor Deloitte that has agreed to pay the government RM324 million in compensation.
“The failure for an auditor to exercise professionalism in their duties to protect Malaysian taxpayers is an extremely serious matter.
“An example must be set to ensure no other auditor of government entities will ever behave in the same way which contributed to making Malaysia the world’s largest kleptocracy because of the RM50 billion 1MDB scandal,” he said in a statement today.
The statement came after it was reported on July 9 that the government filed a suit against KPMG Malaysia and its partners for US$5.64 billion (RM23.8 billion) over its role in auditing and certifying 1MDB’s financial statement for financial years 2010 to 2012.
In the lawsuit, the Ministry of Finance Inc, 1MDB, and five other plaintiffs alleged that KPMG failed to give a true and fair view of the state investment fund’s financial affairs and failed to red-flag misappropriation of 1MDB funds.
The amount is calculated as:
- US$1.83 billion allegedly misappropriated from the 1MDB joint venture with PetroSaudi International
- US$1.367 billion from 1MDB to Aabar British Virgin Islands for alleged security deposits
- US$1.59 billion of alleged misappropriation from proceeds of 1MDB Global Investment Ltd bonds to Overseas Investment Funds
- US$856,317 million purportedly misappropriated from the proceeds of two syndicated term loans procured by 1MEHL to Aabar BVI and Aabar Seychelles
The lawsuit was made after long-running negotiations with KPMG to settle the matter and recover the lost funds.
KPMG denied the lawsuit’s allegations and said it would “vigorously” contest the claims in court.
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