1MDB reiterates no cover up on investigations

1Malaysia Development Bhd (1MDB) has reiterated that there is no cover up over ongoing investigations into the sovereign wealth fund. President and group executive director Arul Kanda Kandasamy said there was no possibility of such an action, as the company had undergone extensive investigations by both domestic and foreign regulatory authorities.

"I am pleased to say on the back of an earlier investigation by Bank Negara Malaysia, the Auditor-General determined that no offences had been committed," he said in an hour-long interview with radio station, BFM89.9, earlier today.

During the talk show, Arul Kanda shared his side of the story in addressing criticisms, concerns and controversies levelled against him and 1MDB.

He said 1MDB has not been contacted by any of the foreign authorities for their investigations. However, he noted that the Swiss had been in touch with the Malaysian Attorney-General, on its own investigation.

Asked if there was room for non-compliance with Bank Negara's requirements, Arul Kanda said: "The central bank has the authority to demand certain action.

"Now, whether such action can be complied with or otherwise, is a function of the facts of the situation. We fully respect the law and the authority of Bank Negara to impose any such action as it may deem necessary."

He noted that 1MDB had always cooperated to the extent possible with the relevant authorities, and maintained that if any wrongdoing was found, then action must be taken under the law.

Asked about allegations that assets in its Petrosaudi joint venture were worthless, Arul Kanda said: "We can't stop people making allegations nor stop them from telling lies.

"What we can do is say, should anyone have any facts or evidence, then do submit it to the relevant authorities."

On the US$1.83 billion in funds which was ordered to be repatriated by Bank Negara, he explained that it was ultimately converted and ended up as fund units as of March 31, 2014, while worth US$2.33 billion.

From this, US$1.44 billion was redeemed in cash and paid out for various purposes, while the balance of US$940 million in fund units was designated for a "debt for asset" swap with Abu Dhabi's International Petroleum Investment Co (IPIC).

To a question as to what had landed 1MDB into the current situation, he stressed that the company was facing a business challenge and that the issue had been highly politicised.

"When politicians jumped onto the bandwagon, they use sound bites without reference to the facts, and when they make allegations without proof...that is sexy and the press laps it up, reporting it as such," he said.

He said 1MDB's current challenge is to ensure it can explain its position.

"I fully accept that things could have been done better, from a communications perspective," he added.

As to how highly involved Prime Minister Datuk Seri Najib Tun Razak - as chairman of 1MDB's board of advisors - is on the company's rationalisation, Arul Kanda said communication is through the Finance Ministry as the shareholder.

He added that there is a specific committee comprising various professionals in the Finance Ministry that the company worked with to implement the rationalisation plan, with Najib not part of it.

"I am sure that everyone will understand that 1MDB is but one of hundreds, if not thousands of companies owned by the government. We have clear governance procedures, particularly when the rationalisation plan is implemented," Arul Kanda said.