Praveen Nagappan calls on Australian authorities to investigate Malaysian officials allegedly involved in money laundering and bribery schemes.
Last week The Age newspaper, published a major investigative story alleging that a Malaysian Government Agency, Majlis Amanah Rakyat (MARA), created in 1965 to help the rural poor, had utilised shelf companies registered in different countries, including tax haven the British Virgin Islands, to purchase a property in Melbourne, Australia.
The Age reported that a top MARA officer, senior official and former politician had spent government funds to buy the Dudley International House apartment block in East Caulfield at a price inflated in the millions.
The building houses MARA students who are studying at Monash University.
The trio are alleged to have overpaid A$ 4.75 million (RM 13.8million) for the five-storey apartment block as part of a global money laundering and bribery scheme engineered by greedy local developers and powerful officials overseas. These officials pocketed the extra money from the deal as kick-backs. It goes to show how far MARA has strayed from its core values.
If proven, these corrupt officials and their dirty money would have contributed to driving up Australian property prices. This supports the Australian Federal Treasurer, Joe Hockey’s concern about foreign funds flowing into an already overheated property market. Mr Hockey called for stricter investigations into foreign property investors earlier this year.
The ease with which dirty money is being moved into and out of Australia should be ringing alarm bells at the Reserve Bank of Australia, the Australian Taxation Office and Foreign Investment Review Board (FIRB) offices.
The FIRB should investigate how its foreign ownership threshold was circumvented and the Reserve Bank should investigate how monies alleged to be bribes in the millions was remitted overseas with such ease.
To this end, with the support of the Centre to Combat Corruption and Cronyism (C4) in Malaysia, SABM Australia will lodge complaints with the relevant authorities here in Australia to prompt investigation.
Investigation by Australian authorities is crucial as Malaysian authorities appear to be disinterested in investigating these serious allegations of misconduct and corrupt practices. The Inspector-General of the Royal Malaysian Police has stated that the police will not be involved in investigations as elements of criminal breach of trust were not present.
This is surprising as the act is not merely a question of criminal breach of trust. The parties involved are clearly being accused of having contravened anti money laundering legislation. It is astounding that the Malaysian police are in haste to declare that they will not be involved in investigations without first looking at the money laundering angle.
However, it is widely perceived that even if Malaysian authorities were to investigate these allegations, the effectiveness of these investigations would be questionable as the MARA chairperson Annuar Musa originally hinted at the Malaysian Prime Minister, Datuk Seri Najib Razak’s involvement in approving the purchase.
The following day, Mr Musa conflicted himself by stating that Mr Razak had opposed the purchase. Mr Musa’s contradicting statements have further muddied the waters and cast doubt on MARA’s due diligence procedures. (Editor’s note: Najib Razak has announced a government investigation into the alleged scandal).
This corruption scandal has come hot on the heels of ongoing investigations in relation to involvement of government agencies and public institutions such as the Employees Provident Fund and the Hajj Pilgrims Fund in purchasing assets overpriced in the billions from Malaysia’s debt-ridden strategic development fund , 1Malaysia Development Berhad (1MDB). These have been made to help pay down 1MDB’s debt pile of A$ 14.5 billion (RM 42 billion) which has been invested in assets alleged to have been purchased at premium prices.
The scandal has cast Malaysians in Australia in poor light, with the Malaysian image already taking a battering in Australia in recent times, especially since the authorities’ handling of the Malaysian Airlines tragedies last year.
We do not need corrupt officials to erode what’s left of our image.
Left unchecked, Tourism Malaysia’s sloganeering, “Malaysia Truly Asia”, may soon paint a completely different picture of what the region has to offer.
Praveen Nagappan is chairperson of Saya Anak Bangsa Malaysia in Australia, a group of Malaysians based in Australia who advocate for enhanced governance in Malaysia.