Malaysian Bar EGM adopts resolution on 1MDB and related matters

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A motion condemning the interference with the 1MDB investigations tabled by Bar Council chairman Steven Thiruneelakandan was passed with a thumping majority.

The Extraordinary General Meeting of the Malaysian Bar that took place at the Renaisance Hotel on 12 September 2015 achieved quorum at 9.59am with 502 members signed in. The attendance thereafter swelled to 1,040. The EGM was adjourned at 12.47pm.

One motion tabled by Steven Thiruneelakandan, as chairman of the Bar Council and on behalf of the Bar Council, was considered and passed with a thumping majority.

Resolution on the allegations of financial impropriety concerning 1MDB and its related companies, the transfer of RM2.6bn and the flow of RM42m into the prime minister’s personal bank accounts, and matters in connection therewith:

whereas:

(1) There have been numerous media reports on allegations of serious financial impropriety concerning 1Malaysia Development Berhad (1MDB), a company wholly owned by the government of Malaysia.

(2) On 11 May 2015, the then-chairman of the Public Accounts Committee (PAC) of parliament and Member of Parliament for Pulai, Nur Jazlan bin Mohamed, issued a statement, stating that the PAC would start its inquiry into 1MDB and that it intended to question several persons, including the present Chief Executive Officer of 1MDB, Arul Kanda Kandasamy, as well as his predecessor, Shahrul Ibrahim Halmi. Both were initially scheduled to give evidence on 26 May 2015.2 This was later adjourned to 4-5 August 2015 at their request (but did not ultimately take place).

(3) On 2 July 2015, the Wall Street Journal (WSJ) and Sarawak Report (SR) reported that government investigation documents had disclosed that:

(a) funds amounting to approximately $700m (RM2.6bn) were transferred into the personal bank accounts of the prime minister of Malaysia, Mohd Najib bin Tun Abdul Razak in AmIslamic Bank Berhad in March 2013. WSJ also reported that the original source of the funds was unclear and the subsequent use of the funds was unknown; and

(b) another set of funds totalling RM42m was transferred from SRC International Sdn Bhd (SRC, a former subsidiary of 1MDB) to Gandingan Mentari Sdn Bhd, then to Ihsan Perdana Sdn Bhd, and finally to the personal bank accounts of the prime minister.

(4) On 3 July 2015, the prime minister responded to the aforementioned reports by WSJ and SR, stating, “I have never taken funds for personal gain as alleged by my political opponents — whether from 1MDB, SRC International or other entities, as these companies have confirmed.” On 8 July 2015, the prime minister issued another statement reiterating, “I have never taken 1MDB funds for personal gain.”

(5) The prime minister’s solicitors wrote a letter to WSJ seeking “clarification” of the aforementioned report. WSJ’s publisher replied stating, “We stand behind our fair and accurate coverage of this evolving story.”

(6) The prime minister has not expressly denied that RM2.6bn and RM42m were deposited into his personal bank accounts, as reported by WSJ and SR.

(7) On 4 July 2015, the then-Attorney General of Malaysia, Abdul Gani bin Patail announced that a multi-agency task force (special task force) had commenced investigation into the allegations of funds transferred to the prime minister’s personal bank accounts. The Special Task Force consisted of Gani; the governor of Bank Negara Malaysia (BNM), Zeti Akhtar Aziz; the Inspector General of Police (IGP), Khalid bin Abu Bakar; and the chief commissioner of the Malaysian Anti-Corruption Commission (MACC), Abu Kassim bin Mohamed.

(8) On 7 July 2015, in a joint media statement, the special task force announced that based on the investigations undertaken by the agencies represented in the special task force, an order to freeze six bank accounts of suspected parties was issued on 6 July 2015. In addition, investigators seized documents relating to 17 bank accounts from two banks to facilitate the investigation. Investigators also seized documents pertaining to noncompliance of BNM’s rules and procedures by the banks involved.

(8A) On 8 July 2015, the special task force raided the office of 1MDB in Kuala Lumpur and seized documents and computers. Earlier, on 3 July 2015, the special task force had also raided the offices of SRC, Gandingan Mentari Sdn Bhd and Ihsan Perdana Sdn Bhd, and also seized documents.

(9) On 8 July 2015, the Malaysian Bar issued a press statement urging:

(a) The special task force to conduct a comprehensive, detailed, and unfettered investigation into the allegations made by WSJ and SR; and

(b) The prime minister to take a leave of absence from office pending the outcome of the ongoing investigation of the special task force, to avoid any perception of interference by him in the investigation, as the attorney general is the chief legal advisor to the government, the MACC is under the purview of the Prime Minister’s Department, and BNM falls under the portfolio of the minister of finance (who is the prime minister).

(10) Between 21 and 26 July 2015, five individuals were detained by the MACC over the investigation into 1MDB, and subsequently released. They were Jerome Lee, group executive director of Putrajaya Perdana Berhad, Datuk Shamsul Anwar Sulaiman of Ihsan Perdana Sdn Bhd, and three other individuals — Ariffin Ismail Shahul Hameed, Datuk Rosman Abdullah and Tazri Talib.

(11) Various actions, including administrative action, have been taken to harass and intimidate those who have been critical of 1MDB and the Prime Minister:

(a) On 24 June 2015, the Minister of Home Affairs, Ahmad Zahid bin Hamidi, accused The Edge Media Group (the publisher of The Edge Financial  Daily) and its owner Tong Kooi Ong, of publishing inaccurate reports and false information relating to 1MDB. On 29 June 2015, the ministry of homeaffairs issued a show-cause letter to The Edge Financial Daily over its reports on 1MDB, giving it seven days to provide a written explanation on why action should not be taken against it under the Printing Presses and Publications Act 1984;

(b) On 1 July 2015, the publisher and chief operating officer of The Edge Media Group, Ho Kay Tat, in response to the show-cause letter, sought clarification as to which were the offending articles relied upon by the ministry of home affairs, and reiterated that all their articles were based on carefully evaluated evidence and were truthful;

(c) On 19 July 2015, the Malaysian Communications and Multimedia Commission issued an administrative order under Section 211 and Section 233 of the Communications and Multimedia Act 1998 to block the SR website, due to perceived threats to national security. SR has been one of the sources of allegations of wrongdoing involving 1MDB, which has implicated the prime minister;

(d) On 20 July 2015, subsequent to the said disclosure by WSJ and SR, The Edge Financial Daily, which had been publishing a series of articles critical of financial transactions involving 1MDB, published a flow-chart detailing the money trail involving global banks in an article titled, “How Jho Low & PetroSaudi schemed to steal money from the people of Malaysia via 1MDB”. In an accompanying note, the publisher stated that its report was based on evidence that included bank transfer documents and bank statements, and that they would be handing over these documents and the hard disk that contained them to the investigators. The publisher maintained that their reports on 1MDB “had exposed how a group of individuals —Malaysians and foreigners — schemed a multi-billion ringgit fraud against the people of Malaysia”;

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(e) On 22 July 2015, it was discovered that the director general of immigration, under the Immigration Act 1959/63, had imposed a ban on overseas travel on Member of Parliament for Petaling Jaya Utara Tony Pua Kiam Wee; Member of Parliament for Pandan Mohd Rafizi Ramli; and Tong Kooi Ong, without providing any reason. These persons had been at the forefront of criticism of 1MDB or in the exposé of alleged wrongdoing concerning 1MDB;

(f) On 23 July 2015, the ministry of home affairs, under Section 7(1) of the Printing Presses and Publications Act 1984, imposed a three-month suspension order on The Edge Weekly and The Edge Financial Daily, on grounds of possible public alarm over the publication of reports concerning 1MDB and allegations in them that implicate the government and national leaders. The Edge has commenced a judicial review action against the minister of home affairs, and has been granted leave to challenge the suspension order but has failed to obtain a stay against the order; and

(g) On 23 July 2015, Ho Kay Tat was summoned for questioning by the Royal Malaysian Police (Polis DiRaja Malaysia, PDRM) over articles relating to 1MDB that were carried in The Edge Financial Daily, for an offence under Section 124B of the Penal Code. On 28 July 2015, it was reported that PDRM had summoned Ho Kay Tat for questioning again and further, Tong Kooi Ong as well.

(12) During the Umno Cheras Division gathering held on 26 July 2015, the then deputy prime minister Muhyiddin bin Mohd Yassin said, “I must speak the truth. I cannot bluff because I know millions of people. Berjuta  rakyat bersamamu. Apakah ada di dalam kerajaan yang rasa bertanggungjawab dan mahu berbuat sesuatu dan pecahkan sesuatu supaya satu pembetulan mesti dibuat. Sebab itu saya kata, ‘Apa hal 1MDB.’ Kalau mereka sudah membawa beban besar kepada negara 42bn lebih, katanya tanggungan, maka ahli-ahli lembaga pengarah harus bertanggungjawab. Betul? … Dan saya beritahu perdana menteri, “Sack them, remove them.” Sepatutnya you sack them. Saya kata kalau saya ada sebuah syarikat, saya tak ada syarikat, dulu saya punya dan saya tahu bisnes dan sebab tunggang terbalik, rugi begitu banyaknya, apa saya buat? What you do? Stay? Don’t stay. Go. Resign. Leave. You are responsible. You have to bear the responsibility. Tapi saya minta maaf. I am sorry to say prime minister, maybe he listen but that is not important. Saya sebut di sini sebab inilah pertama kali, platform yang saya cakap dalam parti.”

(13) On 28 July 2015, the following events occurred:

(a) Gani, the then attorney general and a pivotal member of the Special Task Force, was abruptly removed from office, barely 69 days from his retirement date, purportedly due to his failing health. In his place, the government appointed Federal Court judge Mohamed Apandi bin Haji Ali;

(b) The director of the Special Branch of the PDRM, Akhil Bulat, was abruptly replaced, three weeks before his contract expired, and put on retirement leave;

(c) The then deputy prime minister, Muhyiddin, and the then minister of rural and regional development, Mohd Shafie bin Apdal (both of whom had publicly called on the prime minister to explain the scandal engulfing 1MDB) were dismissed from cabinet by the prime minister; and

(d) Four of the 13 members of the PAC — which had been investigating the 1MDB allegations — including its chairman, were appointed minister or deputy minister, in effect disqualifying them from membership of the PAC and crippling the PAC’s ongoing investigation into 1MDB. The PAC proceedings scheduled on 4-5 August 2015, for the evidence of the present and former CEO of 1MDB to be taken, were postponed by the Speaker of the Dewan Rakyat, who said the PAC could not proceed until the new chairman is selected.

(14) On 29 July 2015, the five MACC oversight panels issued a joint press statement appealing for the special task force to be allowed to conduct the investigation without any interference or pressure from third parties.

(15) On 30 July 2015, SR disclosed two purported draft charge sheets in an article entitled
“Arrest warrant for the prime minister — The real reason the attorney general was fired”, and alleged that the purported draft charge sheets were the reasons for the removal of Gani. The first alleged charge sheet stated that the prime minister and other persons had committed corruption offences under the MACC Act 2009. The second alleged charge sheet stated that the prime minister, as finance minister and “Ameritus [sic] Advisor” to SRC, had committed criminal breach of trust under the Penal Code. Both Apandi and the MACC have denied the existence of these alleged charge sheets.

(16) On 30 July 2015, MACC issued a press statement, denying that its officers were involved in a conspiracy to topple the government, and that, as an independent commission, it is responsible for conducting investigation freely, transparently and professionally, without fear and favour, regardless of the persons involved.

(17) On 1 August 2015, a former adviser to the MACC, Tan Sri Rashpal Singh; a member of the secretariat for administration and finance of the anti-money laundering task force at the Attorney General’s Chambers, Jessica Gurmeet Kaur; and a deputy public prosecutor seconded from the AGC to the MACC, Ahmad Sazilee Abdul Khairi; were arrested, and subsequently released. The office and home of at least one of them was raided, and documents related to MACC’s investigations were reportedly removed.

(18) As at early August 2015, MACC personnel became the focus of police investigation into allegations of leaking of confidential information and involvement in a supposed conspiracy to overthrow the government, purportedly in violation of Section 124B of the Penal Code. These actions taken by the authorities against the MACC are listed in Appendix A. In this regard:

(a) Minister in the Prime Minister’s Department in charge of governance and integrity, Senator Paul Low Seng Kuan, reportedly stated on 6 August 2015 that PDRM “are showing high-handedness”, and that it “is important that [MACC] do what they need to do.”

(b) The chairman of MACC’s consultation and corruption prevention panel, Johan Jaaffar expressed “dismay over the spate of raids and arrests by the police”, and “reiterated the need for the agency to be allowed to execute its duties unhindered”.

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(19) On 3 August 2015, the MACC issued a statement stating that the RM2.6bn in the prime minister’s personal bank accounts did not originate from 1MDB but was a “donation”. The MACC also announced that it intended to question the prime minister on the “donation”. To date, there has been no indication that the MACC have indeed questioned the Prime Minister.

(20) On 5 August 2015, PDRM obtained a warrant of arrest against Clare Rewcastle-Brown @ Clare Louise Brown, a journalist based in the UK who runs the SR website, in relation to investigation under Sections 124B and 124I of the Penal Code, for publishing a false report on the purported draft charge sheets in the article entitled “Arrest warrant for the prime minister — The real reason the attorney general was fired” in order to implicate the prime minister for criminal offences. PDRM subsequently submitted a request for a “red notice” to Interpol. The request was reviewed by Interpol and subsequently refused on 9 August 2015.

(21) On 5 August 2015, the special task force was disbanded by Apandi Ali. Further, it was reported that a new task force named the National Revenue Recovery Enforcement Team (NRRET) — consisting of the AGC, BNM, PDRM, the Customs Department and the Inland Revenue Board — was set up by the AGC. The acting chief commissioner of the MACC reportedly said that the MACC had been excluded from the NRRET but it will continue with its investigation. Subsequently, on 25 August 2015, the AGC announced that the MACC is one of the eight entities in NRRET, and that “NRRET is not in any way involved with any investigations involving 1MDB and its related companies.”

(22) On 9 August 2015, the IGP announced that the investigation into the MACC has been temporarily postponed to avoid “various assumptions that were made that had altered public perception”, and the MACC has recently announced that it is still investigating the “donation” as well as the funds transferred from SRC into the prime minister’s personal bank accounts.

(23) On 13 August 2015, the IGP stated that PDRM had questioned seven BNM officers under the Financial Services Act 2013 over the leak of confidential information/documents. He had earlier said that PDRM would haul up several officers from BNM and other commercial banks for questioning in its investigation into the leaking of confidential information/documents. PDRM have also taken action against the officers of BNM.

(24) On 13 August 2015, Zeti stated that BNM had completed its investigation, which were relating to transactions by 1MDB, and had submitted its investigation papers to the attorney general with the recommendations for the appropriate enforcement action. She also said, “I have to be very careful with what I say that it has to be within the confines of the law. Otherwise, the moment I step out ofthis door, I will face arrest for talking about an individual account. I am sure you don’t want that to happen.”

(24A) Also on 13 August 2015, Zeti is reported to have said that investigating RM2.6bn in donations to the prime minister’s personal bank accounts is not within BNM’s purview.

(25) Subsequent to the replacement of the director of the Special Branch on 28 July 2015, the deputy director of the Special Branch of the PDRM, Abdul Hamid Bador, was abruptly transferred out of the Special Branch on 19 August 2015 to the prime minister’s department. He has since alleged that there was a secret “Hang Tuah” gang behind moves to hide information and witnesses relating to 1MDB, and that his transfer to the prime minister’s department was to put him in “cold storage” in a post that was “nonexistent”. He has also alleged that witnesses are hiding abroad with the help of certain parties. He has since been issued with a show-cause letter.

(25A) On 20 August 2015, it was reported that the AGC had terminated the services of Jessica Gurmeet Kaur, and there were subsequently issues concerning the revocation of her permanent residency status in Malaysia.

(26) In an interview to the press on 16 August 2015, the Urban Wellbeing, Housing and Local Government Minister, Abdul Rahman Dahlan, appeared to imply that the prime minister had interfered in the MACC’s investigation into the deposit of funds from SRC and the transfer of RM2.6bn into the prime minister’s personal bank accounts.

(27) In the said interview, Abdul Rahman Dahlan spoke of an alleged deliberate attempt to “criminalise” the prime minister and force him out of office. It was also reported that he had stated that “drastic action” was needed to “take these people out first”, and there was a “… flurry of action taken by the Prime Minister”.

(28) On 30 August 2015, former prime minister Dr Mahathir Mohamad held a press conference, where he is reported to have said, “… He (the prime minister) had no proof so to tackle the PAC, Public Accounts Committee, he offered them jobs to become deputy minister. This is a kind of bribery. And now the PAC is not functioning. The other agencies also cannot work because whenever you make a report, the police will not take action. And the new AG will not take action. So, he has undermined the constitution and the legal system of this country. There is no more rule of law … He created 1MDB to borrow money and then the money disappeared. And suddenly RM2.6bn appeared in his account. Not in Umno but in his account. He is using this money to bribe people. So, we want to ask, why did you stop the investigation on your RM2.6bn. Where did this money come from? Don’t tell lies about Arabs giving RM2.6bn. No Arab will give to anybody that kind of money. Nobody will give a lot of money to anybody, not that amount, RM2.6bn. So, where does the money come from? The only money that can come maybe through 1MDB.”

(29) The categorisation of the funds as a “donation” raises more questions than answers. There has been further varying and contradictory accounts or explanations as to the origin and purpose of the “donation”, as seen in Appendix B. Questions also abound as to why a substantial part of the funds were subsequently remitted out of the country to Singapore. The prime minister’s personal bank account was then closed.

(30) The series of events since the disclosure by WSJ and SR have given rise to the inference that there has been interference in, and obstruction of, the investigation to the point where investigation has been compromised.

(31) The drastic, oppressive and chilling measures taken since 28 July 2015 appear to have derailed, hindered or obstructed the investigations or inquiries into 1MDB, the remittance of RM2.6bn and the remittance of RM42m by SRC into the personal bank accounts of the prime minister.

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(32) The far-reaching actions taken since 28 July 2015 have been an assault on the independence of the special task force that had been investigating the allegations made by WSJ and SR that implicated the prime minister, and these actions have further impaired or compromised the integrity of the investigation by the special task force.

(32A) The abovementioned measures and actions have been attributed to the prime minister, the government, and/or agencies under the government.

(33) The manner in which the PAC has been crippled and its investigation stymied gives rise to serious questions about the ongoing proceedings of the PAC and the ability of the Legislature to act as an effective check and balance on the activities of the Executive.

(34) The action taken by PDRM against the MACC was intimidatory and oppressive, and is widely seen as having interfered with, and obstructed, MACC’s investigation into the transfer of funds into the prime minister’s personal bank accounts as well as an attack on the independence of the MACC and its emasculation as a corruption-combating agency.

(35) The abrupt and unexplained disbanding of the special task force, which was established to solely focus on investigating the allegations of funds transferred to the prime minister’s personal bank accounts and issues relating to 1MDB before the completion of its tasks casts doubt on the sincerity and commitment on the part of the government to investigate the said allegations. The announcement by Apandi that the individual agencies that were represented in the special task force would continue carrying out their individual investigations within their respective purview detracts from the original focus and coordinated collaboration between the heads of the agencies of the special task force.

(36) In light of the action taken against officers of BNM and the statements made by Zeti, there are serious concerns raised as to whether the investigation by BNM, as a member of the special task force, has been thwarted and compromised. Further it is inexplicable that BNM has concluded that the “donation” of RM2.6bn is not within its remit, despite the relevant provisions in the Central Bank of Malaysia Act 1958; Financial Services Act 2013; Exchange Control Act 1953; Capital Markets and Services Act 2007; and Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.

(37) The replacement of the director of the Special Branch and now the transfer of the deputy director of the Special Branch suggest that there has also been interference with, and obstruction of, the investigation conducted by the Special Branch of the PDRM.

(38) Abdul Rahman Dahlan’s statements in reference to the pre-emptive measures taken by the prime minister appear to validate the already pervasive public perception that there had been active and deliberate steps taken by the prime minister or the authorities to interfere, impede and derail the investigation to mask wrongdoings and exculpate wrongdoers.

(39) In light of Abdul Rahman Dahlan’s statements, it can be inferred that the prime minister or the authorities — under his instruction or the instruction of his subordinates — have undermined and subverted the investigation into the transfer of funds into the prime minister’s personal bank accounts.

(40) There appears to be a concerted effort to weaken and compromise various institutions involved in the investigation into the transfer of funds into the prime minister’s personal bank accounts.

(41) There are grave concerns that there would be a cover-up or whitewash of wrongdoing and the exoneration or exculpation of wrongdoers.

(42) In light of the above, and the tremendously grave concerns that have arisen and recalling the objects of the Malaysian Bar as set out in Section 42(1) of the Legal Profession Act 1976, and in particular:

Section 42(1)(a): to uphold the cause of justice without regard to its own interests or that of its members, uninfluenced by fear or favour; …

Section 42(1)(d): where requested so to do, to express its view on matters affecting legislation and the administration and practice of the law in Malaysia; …

Section 42(1)(g): to protect and assist the public in all matters touching ancillary or incidental to the law;

therefore, it is hereby resolved that:

(a) The Malaysian Bar condemns the interference with, and the subversion of, the cause and administration of justice, and the investigation and inquiry into the allegations of financial impropriety concerning 1MDB and its related companies, and the transfer of RM2.6bn and the flow of RM42m from SRC, both into the prime minister’s personal bank accounts;

(b) The Malaysian Bar condemns the abrupt removal of Gani; the crippling of the PAC; and the harassment, intimidation and oppression of investigating officers or personnel of the AGC, MACC, BNM, and the Special Branch of the PDRM;

(c) The Malaysian Bar demands that the Malaysian government immediately advises the Yang di-Pertuan Agong to establish a royal commission of inquiry (RCI), that should comprise members who are independent, impartial and of unimpeachable integrity, to inquire into and investigate:

(i) the allegations of financial impropriety concerning 1MDB and its related companies;

(ii) the transfer of RM2.6bn into the prime minister’s personal bank accounts; and

(iii) the flow of RM42m from SRC into the prime minister’s personal bank accounts; and to report on, and make public, its findings and recommendations, including any further action that needs to be taken.

(d) The Malaysian Bar notes that several members of the administration are advocates and solicitors of the High Court of Malaya, and the Malaysian Bar reminds such members of the administration that, whether in active practice or not, all advocates and solicitors are expected at all times to protect and further the rule of law and to uphold justice. The Malaysian Bar further reminds such members of the administration that the failure to maintain the core values of the legal profession would render them liable to disciplinary action under the Legal Profession Act 1976.

(e) The Malaysian Bar mandates the Bar Council to take any and all steps that it deems appropriate in order to affirm and preserve the rule of law, to uphold the Federal Constitution, and to protect the administration of justice, including but not limited to, instituting a legal suit(s) against any person(s) responsible for the interference with, impediment to, or obstruction or perversion of, the administration of justice, and the investigation into:

(i) the allegations of financial impropriety concerning 1MDB and its related companies;

(ii) the transfer of RM2.6bn into the prime minister’s personal bank accounts; and

(iii) the flow of RM42m from SRC into the prime minister’s personal bank accounts.

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