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Published On: Fri, Oct 13th, 2017

Bank Negara’s Forex Losses to be Presented to King

Bank Negara’s findings will be presented to the king tomorrow. The bank has been under investigation by the Royal Commission of Inquiry (RCI) for forex trading losses between the 1980s and 1990s. Mohd Sidek Hassan, RCI chairman, will submit a report at 5pm at Istana Negara to Yang Di-Pertuan Agong.

photo/ См. ниже via wikimedia commons

Suhaimi Ibrahim, RCI chief conducting officer, states, “The report will be made public only with the consent of Yang Di-Pertuan Agong.”

Bank Negara’s scandal began under Dr. Mahathir Mohamad’s reign as the country’s prime minister in the 1980s. The RCI held a nine-day hearing on the matter, with 25 witnesses testifying during the span. Anwar Ibrahim, former opposition leader and finance minister also had to testify.

Bank Negara had forex losses of $10 billion between 1991 and 1993.

The substantial losses led to the RCI investigating the matter to uncover what happened to the money. The RCI also investigated 42 documents, including some documents that were part of the Official Secrets Act (OSA).

The documents have not been made public at this time.

The RCI is investigating whether or not the losses, which occurred between the 1980s through 1994, broke any laws. Dr. Mahathir states that the investigation is “politically motivated.” Opposition to the investigation suggests that the goal of the investigation is to tarnish Pakatan Harapan’s reputation, opposition leader.

Dr. Mahathir states that the losses were nowhere near as high as the $10 billion the RCI claims. He states that his knowledge of the losses comes from audited reports.

Former assistant governor Murad claims that the losses were much higher than the $3 billion claimed. The claim, told to the New Straits Times, led to the formation of a Special Task Force.

Lawyers last submitted their submissions on September 21 and have not commented further on the matter. Dr. Mahathir’s lawyers state that lawyers had not been allowed access to audit reports and documents, which would allow for greater insight into the central bank’s trading.

“The chairman did not make any ruling and yet opined that the RCI was not bound by the Official Secrets Act, which is a major error in law,” he said.

Anwar’s lawyers state that the $10 billion in losses figure could not be verified.

Witnesses testified that the central bank started to pursue forex trading at a time when there was very relaxed trading rules in place. The witnesses also claim that there was a lack of administrative oversight during the time of the losses.

Staffers claim that they never knew the extent of the losses and only learned of the losses when it was too late. The staffers state that they operated fully within their job scope. The culture of the central bank, according to testimony, indicates that the issues within the bank never went beyond supervisors.

Witnesses, many of which are now in their 70s and 80s, also demonstrated poor memory of the events that happened 23 years ago and prior. Names, figures and dates often seemed unclear during the testimony, according to the RCI.

Witnesses also have differing stories as to when Dr. Mahathir and Anwar learned of the total losses.

Author: Jacob Maslow

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