The mounting evidence about Malaysia’s world-beating levels of corruption has raised growing questions for those international companies which are risking their reputations by engaging with characters like Abdul Taib Mahmud.
For example, DAP have once again drawn attention to the gaping Black Hole in Sarawak’s recently published public accounts.
It represents RM11billion of public funds which have disappeared without explanation amounting to 50% of Sarawak’s entire budget over the past 8 years!
Why has Abdul Taib Mahmud, who acts as both Finance Minister and Chief Minister, failed to declare where all this money has gone?
Two years ago the unaccounted for expenditure was less than half this amount at RM4.6 billion, so what on earth is Taib doing with the money and when is this frightening trend going to stop?
As DAP have pointed out, Taib has squirrelled away this unaccounted for RM11billion under a mysterious category in the budget entitled “Government Contributions towards Approved Agencies Torts fund”.
There is no explanation as to what these Agencies are, what they do or who ‘approved’ them. It certainly wasn’t the State Assembly.
Do other governments allocate money in such a way in their accounts? No, they do not.
Honest administrations do not have special secret funds with bizarre names into which half the budget goes with no further explanation. They expect to detail all their expenditure, so everyone can see exactly where the public’s money has gone and check that no one has stolen it.
But it appears Taib thinks he can do what he likes in Sarawak. He thinks he can bribe hungry voters with a bit of rice money at election time, so they will let him steal their country from under them. The federal government has failed in its duty to restrain him, because sadly it is equally mired in corruption.
So, we are left to guess. Perhaps these “Approved Agencies” hand out aid and support to the poor natives of Sarawak, who have seen their forest areas destroyed, rivers polluted and land taken for oil palm? But, there is not much evidence of that, nor of roads, schools and clinics.
Maybe, instead, these “Aproved Agencies” pour money into projects being undertaken by companies owned by Taib Mahmud?
Doesn’t that seem rather more likely the way Sarawak’s ‘politics of development’ are managed?
At issue is why are certain international companies with shareholders and reputations to protect still agreeing to do business with Taib, when Sarawak’s State Budget proves to be such a disreputable document? The matter is increasingly raising eyebrows outside of Sarawak in international circles and becoming a cause for concern.
Taib’s international cronies
There is a long list of foreign companies which are clearly still willing to engage in business with Sarawak and T
aib’s own family companies, but it is evident that confidence is draining away as the exposure continues. And quite rightly the rules against profiting from the proceeds of corruption are getting tighter.
Several companies have been tempted to get involved in SCORE and to take contracts for building Taib’s grand dam projects, but many of them are now thinking twice. Rio Tinto Alcan pulled out in March, after we exposed they planned to invest $2billion in a company owned by the Taibs, SALCO.
And in December Hydro Tasmania also decided to end its involvement in the face of protests by native people against the illegal dam projects. Eyes are now turning towards other investors and contractors who are planning to take advantage of SCORE.
And then there are the big financiers. The UK bank HSBC has been exposed by the NGO Global Witness for raising money for numerous logging ventures in Sarawak, despite the widespread knowledge that all concessions are corruptly linked to Taib and the logging is blatantly destructive and unsustainable.
Then what about Deutsche Bank, which not only looks after a chunk of the Taib family’s money and foreign property interests abroad in its role as the nominee and trustee of the company Sogo in the off-shore tax haven of Jersey, it also acts as the partner of Kenanga Holdings Sdn Bhd.
Kenanga Holdings is a major investment house jointly owned by Taib’s family firm CMSB and Deutsche Bank itself. The German authorities are currently investigating the venture.
And how about Ernst and Young, the multi-national accountants who year after year provide tidy looking accounts for CMSB, even though this Taib family company has taken over huge chunks of the state economy and operates vast monopolies, thanks to Taib’s own patronage?
We have sent emails to Ernst and Young, asking how working with CMSB equates with the company’s Global Code of Conduct, but they have all remained unanswered.
Then there is Switzerland’s UBS bank which has been involved, again with Deutschebank, in raising hundreds of millions of dollars for the State of Sarawak through a private company in Labuan, not quite the normal way of doing things. Of course UBS is already facing a criminal investigation in Switzerland over its management of the million dollar accounts linked to Sabah Chief Minister, Musa Aman.
Even America’s Goldman Sachs now seems to have taken over as the lead banker for raising money for the Taib regime, again through Labuan in a similar deal.
And we have already detailed how yet another huge American bank, Merrill Lynch (now owned by Bank of America) has obligingly been prepared to transfer large funds for Taib’s key business partner brother, Onn Mahmud (to whom he handed the monopoly on timber shipping licences) from Hong Kong into Sydney.
Onn has purchased over £50million worth of property in Sydney with this money and then sold most of it with Merrill Lynch obligingly once more exporting the money into a trust managed in the Isle of Man through companies incorporated by Merrill Lynch on Onn’s behalf in the off-shore Cayman Islands.
Is this best banking practice?
The spotlight is beginning to shine on these companies who seem to think that the millions they can make are worth turning a blind eye to the glaring corruption of Taib Mahmud.
After all, if Taib’s people can’t trust him to run an honest state budget why should the shareholders and lenders from all these banks and companies trust him either?
The foreign decision makers behind these deals face being held accountable.