KUALA LUMPUR, March 24 – Bank Negara Malaysia (BNM) Governor, Tan Sri Dr Zeti Akhtar Aziz, says she will pursue administrative action against 1Malaysia Development Bhd (1MDB) during her remaining 38 days in the bank. She said BNM would like to see the rules and regulations complied with not only by 1MDB but other companies doing business in the country.
“I want to put a close to the 1MDB issue so that the next person will not need to deal with the matter. I want to hand over a clean slate. BNM would submit recommendations for administrative action to be taken against 1MDB due to the non-compliance with the rules regarding their investments abroad,” she told a press conference in conjunction with the release of BNM’s 2015 Annual Report here Wednesday.
Zeti pointed out that the submission would be made to the Attorney-General (AG)’s Office. The Governor also said 1MDB had missed BNM’s deadline to provide supporting documents to show its overseas finances had been used to repay foreign debts and for restructuring programme.
“At this stage we have not received documentary evidence and within a certain timeline that has been stipulated to them. As we assess that they have not fully complied with our direction, we are pursuing appropriate administrative enforcement action as allowed by laws,” she said.
In the meantime, on Oct 19, 2015, BNM, in a statement, said it could take enforcement actions, also known as administrative actions, on parties that were found to have transgressed or have not complied with rules and regulations issued under the Financial Services Act.
“These actions may be taken concurrently with, and are separate and also distinct from, criminal proceedings that are under the sole purview of the AG. Therefore, this is to ensure the integrity of, and confidence, in the financial system,” said the central bank.
To recap, on Oct 9, 2015, BNM announced that it has revoked three permissions granted to 1MDB under the Exchange Control Act 1953 (ECA) for its US$1.83 billion investments abroad. The central bank had also issued a directive to 1MDB under the Financial Services Act to repatriate the amount back to Malaysia and submit a plan to the central bank for this purpose.
It concluded that after investigations 1MDB had obtained permission for its investments with inaccurate information or incomplete disclosure of material information. The statement referred to the decision of the AG’s Chambers, which found that 1MDB officials investigated under the ECA did not make any false statements and cleared it of any wrong-doing. It said the decision “relates to the bank’s recommendation to initiate criminal prosecution against 1MDB for breaches under the ECA.
