書 政 shuzheng

Introduction

Malaysia has wasted too much time going after Najib Razak with the truncheon named 1MDB. Not that getting rid of Najib is unimportant but because past results from expending the effort have been limited and often counter-productive.

Out of USD15 bn that 1MDB borrowed (see other entries in these pages), about USD10 bn was raised offshore and in US bank notes. Of this 10 bn, no more than 2 bn would have ‘genuinely’ been used by Malaysia, paradoxically, to buy its own assets. The remaining sums were, plainly said, looted.

Getting back the remaining USD8 bn is not a lost cause because, think about it, how much can a man spent in a day or a year or ten years: give 1 bn to Jho Low, 1 bn to Najib, 1 bn  to Arabs & others, plus expenses. Eight bn less 3 is 5 bn lying around, but where, what form, and in whose name?

Because of sheer numbers, any high cost of recovery still makes the effort worthwhile. Even in Low’s hands or in Najib’s, much of the money can be recovered because those sums are lodged in individuals, companies and assets such as subscriptions in funds. The efforts may take time but the financial rewards are worth it especially since USD1 buys MYR4.50 today compared to MYR3.20 six, seven years ago. Therein is already a forex profit.

The US could directly trace USD1.5 bn to many types of assets which are recoverable because of its forfeiture laws. It is a starting point but not good enough because Singapore is making no such attempts. Nor the Swiss, it appears. For example, between Yak Yew Chee and Yeo Jiawei they creamed off more than USD40 million and this sum have to exist; you name it, cash or non-cash assets? These assets, Singapore says, will be forfeited (it has such a law for it) but to who does the money go eventually, or where and when? It doesn’t say, that rascal of a state.

The money belongs to Malaysia and must be return to us. Similarly, hundreds of millions in USD lodged by Low in funds also belong to Malaysia and so, too, Najib’s money dissipated to various parties, whether in Malaysia or out it doesn’t matter. Those Arabs, princes and scammers combined, have our money as well and they must be made to cough it out.

A full accounting of 1MDB assets, their whereabouts and so on would need to be carried out but independent of government and Najib. This is possible.

To begin this process of accounting and recovery, Malaysia must first step off from looking at and dealing with 1MDB as a truncheon for use against Najib. Zaid Ibrahim, Mahathir Mohamad and Tony Pua have many times treated it as such. The reality is not so, and some of the reasons are spelled out below. Furthermore, if the political parties are serious about saving Malaysia they should be, for many good reasons, the first to step off the block in this recovery process.

Getting back USD10 bn, or even just USD1 bn, will invariably affect Najib. But this process cannot even begin if Malaysia does not or cannot disabuse itself of the notion that 1MDB is a victim of fraud. It is the fraud. As financiers would say, a special purpose vehicle (SPV) for fraud that the world has never before seen — and probably ever.

To disabuse ourselves of that notion, begin with understanding things: the background and the drivers in 1MDB’s creation, the mechanics of setting it up, its influences, why and how, the financial system, why most of the cash are lodged in Singapore and Switzerland but not the US. We, too, must understand the international laws related thereto: why is Singapore and the US doing different things to 1MDB. Also understand why Jho Low used private banks for much of 1MDB transactions and not, say, HSBC or Citibank. The answers are below.

Malaysia rely too much on newspaper reports to formulate ideas, make resolutions and pass judgment. This is dangerous: Example, the like of Bloomberg and Reuters have endlessly referred to 1MDB as a sovereign wealth fund, even now, and this long-standing, prestige badge once tied to 1MDB have been deceitful and most disadvantageous. It prompted worldwide subscriptions to 1MDB’s USD bond issuance not once but three times! It helped 1MDB get away with raising billions more in bank debt then squirreling away the money. Being a sovereign wealth fund, backed by Malaysia state power, have prompted no less than eight international banks, in Singapore alone, to aid 1MDB in its fraud by transferring money around the world and by acquiring other financial assets. All eight banks have since been penalized by Singapore.

The time has come for Malaysia to stand up and say stop, no more going around in circles: We want our money back! The posting below is the first stab at this effort.

*

*

Why Singapore?

Private banking developed in Europe, Switzerland in particular, from commercial or industrial or retail banks during the tumultuous decades between World War I and WWII when they helped many families and individuals preserved their wealth which, otherwise, might have fallen into the hands of governments, the Nazis especially.

The 140-year-old Swiss bank BSI (now defunct and renamed EFG) in Singapore is such an exclusive private bank. Exclusive because some commercial banks like HSBC offers private banking from within its range of businesses; they are the Johnny-come-lately. Also exclusive because, to open a private bank account in Hong Kong, requires satisfying certain conditions, such as personal background checks and USD1 million in minimum deposit which must be maintained.

Private banks are almost non-existent in — dare we say — third rate cities such as KL. But, as Singapore’s economy grew and wealth accumulated, a need for it grew, especially involving privacy, personal service, speed, and informality. Jho Low could toss around USD1 bn in a matter of days. (To appreciate this fact, try remitting USD1,000 from KL to Singapore via Maybank.) Falcon Bank which belongs to IPIC (remember Falcon? remember IPIC?) was an attempt to imitate this facet of banking; too many rich towel heads, you see.

Then something happened — 9-11 in 2001 — so that in this Era of International Terror a slew of tougher conditions grew for handling money, especially private wealth. These tougher conditions, collectively known as Compliance, issued under UN auspices, were especially placed on banks’ internal processes when handling large sums of monies. For the Compliance to be binding, laws were passed or were updated stringent so that being a banker might not be as fashionable as you once assumed. Before, when you fuck up you are fired. Today, you go to jail, on top of your criminal record. Yvonne Seah who once worked as deputy to Yak Yew Chee, BSI managing director, therefore taking his instructions, is one such casualty.

All the above is by way of background that drives Singapore’s jailing of its four bankers, its penalty fines imposed on eight banks, and closure of two, BSI and Falcon. Singapore, however, didn’t shut down Standard Chartered nor was its MD hauled before the court although, on behalf of the fraudulent company named Blackstone, it moved around more than half of the USD790 million that left 1MDB. It didn’t fine Goldman Sachs through which, and within 12 months, 1MDB got USD6.5 bn. It merely banned Tim Leissner from working there.

There are valid legal and expedient reasons for what Singapore did. In particular, it’s too faraway from the explosions in New York or London or Syria or Afghanistan to feel the compunction or the necessity to be so stringent. There is also an overriding reason to explain Singapore’s actions that we shall return to. For the moment, the purpose of mentioning the above is for a perspective so that you don’t place too much faith — or hope or bets — on reports (from Malaysiakini or Straits Times or blogger Syed Akbar Ali) that, because of Singapore, there’s even a “noose” tightening around the neck of Najib Razak. This ‘noose’ thing may be useful for political or electoral purposes but that’s it.

Illustrating the point above is Yeo Jiawei who is probably the last of the Singapore bankers to be jailed. Of five convictions of its bankers who handled 1MDB money, only Yeo was the most closely connected to Jho Low. His convictions also got the most jail time, total 7 years:

• 30 months for witness tampering, December 2016;
• 24 months for cheating BSI, July 12, 2017; and
• 30 months for ‘money laundering’, also July 12, 2017.

Only the last one appears directly related to 1MDB, but the connection is doubtful. This doubt can be seen in the Yaw Yew Chee case (he got 18 weeks last November, which means he’s out today). There money laundering fell under the law Corruption, Drug Trafficking and Other Serious Crimes and under which Serious Crimes affected (i) ‘Cross Border Movements of Physical Currency and Bearer Negotiable Instruments, Regulations 2007’ and (ii) ‘Cash Transaction Reports 2014’. Money laundering is, therefore, a generic term that newspapers and their reporters conveniently employ but never bother to specify. The US defined it, briefly, as ‘placing “dirty” money in a service company, where it is layered with legitimate income and then integrated into the flow of money‘. It is this ‘layering’ that is illegitimate which meant that, although the operative word is “dirty” — which covers extortion, insider trading, drug trafficking, and illegal gambling — whether the money being ‘layered’ into the system was originally dirty or not dirty becomes irrelevant.

Singapore’s convictions were for failure to legally comply with preventive methods of laundering; in another word, Compliance.

Why only bankers?

Looked at in this way, Singapore’s money laundering affected only people in finance (bankers, insurers, stock brokers) because only they could be involved in the ‘layering’. Jho Low, on the other hand, doesn’t work in a bank and, therefore, doesn’t have the power nor, therefore, the liability involved. Once Singapore didn’t care for whether the money is dirty or clean, then many of its financial employees could easily have landed in court. Example: In October 2012, almost immediately after 1MDB’s USD1.75 bn bond issuance via Goldman Sachs, Jho Low used USD790 mn of it for subscription-purchases into:

• the Christenique Investment Fund, USD291 million;
• the SHS Enterprise Emerging Market Fund, USD76 million.

(Note: Not widely seen in Malaysia, these ‘Funds’ are so named to designate money pooled from various places and sources around the world then used by its managers to, in turn, buy equity or shares or bonds, private or government. EPF is such a manager of pooled funds, except it doesn’t directly operate such funds but passes its workers’ savings into these funds. Profit (but not losses) from these funds are shared between the fund manager and the subscriber such as EPF or Jho Low, who may be operating on behalf of 1MDB. The KL stock market typically receives buy-sell orders from these funds.)

If BSI and other banks were guilty of money laundering, regardless of whether money is ‘dirty’ or clean then, technically, these fund managers are equally liable in the laundering process of ‘layering’. Yet, lawyers for the bankers never offered this defense — that there was nothing illicit in the money — and this is because people like Yak and Yvonne were charged with offenses like forgery and cheating. Yak, for instance, drew up a BSI letter vouching for Jho Low as to the USD110 million — which is a part of 1MDB’s USD790 million received in October 2012 — deposited in his Selune company account with the Swiss Rothschild Bank. (This is the Compliance part of the receiving bank). There were several things wrong with the letter to the Rothschild CEO (again, don’t think highly of bankers, they can be pretty stupid): it required two signatories but only Yak signed; it has to be issued on a template, it wasn’t; it had to be cleared by the bank’s legal department, it wasn’t.

Although written about as a money laundering case, none of these facts presented in court that got conviction had any bearing on money laundering of money, especially if it is illicit. It was, simply, a failure in Compliance. With these bank convictions, you can see why the DOJ didn’t follow Singapore’s criminal prosecutions in the US. On top of combing through millions of emails and hundreds of thousands of correspondence pages, there is especially the difficulty, no, near impossibility, of:

• (a) proving 1MDB money itself was originally obtained from illicit activities, which it was not; it was a bond issue gotten via Goldman Sachs;
• (b) proving ‘layering’, that is, money in, money out, and routed through various channels to disguise the source of illicit money; which was not because the 1MDB money left for Singapore and Switzerland as soon as bond proceeds turned up in 1MDB’s US bank accounts;
• (c) proving there was, as in the Singapore’s cases, forgery and non-Compliance conduct but these had little opportunity to happen because most transactions happened outside.

In the US, the next best thing to do was forfeiture, on the grounds that the 1MDB money, or a large portion of it, didn’t go to its intended purpose. Those are examples of fraudulent conduct, not money laundering. The Swiss has the best description for 1MDB: it is a ponzi scheme (ponzi definition here). This meant that 1MDB itself is a ponzi company and not a victim that Singapore has begun to paint it.

A Singapore-Najib Conspiracy?

We now return to Yeo Jiawei and Jho Low both of who have been accused by Singapore of looting 1MDB like it were a hapless ‘victim‘. This line of argument is highly presumptuous as if Low alone influenced the project and loan decisions, Low secured money for 1MDB, Low instructed 1MDB officers, including Najib, where to send the monies. In short, Low is more powerful than Najib.

Ignore for a moment these absurdities but to say 1MDB is the victim of Jho Low is as good as suggesting that the company along with its officers, namely Sharol Halmi, Casey Tang, Jasmine Loo et al are innocent of any complicity in the fraud, direct and indirect. Singapore’s assertion isn’t just false but also contradictory because some 1MDB senior officers have disappeared while Casey and Jasmine were, at one time, wanted by Bank Negara. In Singapore, Yeo is on trial but it was Low who, out of the blue, was singled out by prosecutors as if he was on trial, and that’s without even charging him for any crime. This is clearly an abuse of law.

The greater, sinister part is this: By declaring 1MDB as victim, Najib is exonerated, in exactly the same fashion as Apandi Ali had exonerated him. Being victim, Najib didn’t ask for any of this, money comes and go, he knows nothing, and all this is a conspiracy to topple him.

The inference of victim is this: Pity 1MDB, looted to the hilt, not once but repeatedly, and it didn’t suspect a thing. Poor fella.

Singapore could’ve just gone on cleaning up its own house, clearing it of its rogue bankers, redeem its clean reputation, and leave it at that. Instead it has deliberately gotten itself into the 1MDB dragnet, stepping right into it. Question, therefore: Has Singapore made a deal with Najib not only to get him out from under the pincers of worldwide investigations, but especially to declare him innocent of all alleged offenses? If so, what is in it for Singapore?

In contrast to Singapore, the DOJ depositions not only made clear that Najib Razak received financial benefits from the 1MDB scam, but  Jho Low was only one of numerous players. He couldn’t have succeeded without the support of financing, of numerous bankers, of Goldman Sachs, of Arabs, of Saudi Arabia and UAE and of two top IPIC executives, indeed the whole world and the entire financial system in which Singapore was representative. The scam didn’t just take place once, in a single strike, but went on and on for five years.

The claim that 1MDB is the victim is also mischievous because, if Singapore is right, then it is like saying Low received those monies in the exact same, mysterious manner as the MYR42 mn going into Najib’s AmBank account: 1MDB didn’t give it to me; I don’t know who the fuck left it there, or why?

How the Ponzi scheme?

Farther below is a table which details, step-by-step, the first 1MDB fraud involving the company and the Arab PetroSaudi International Ltd (PSI), creating 1MDB-PSI. In the table are salient features of the fraud, which goes to show Singapore is absolutely wrong to exonerate 1MDB in the way it did.

1MDB, and not Good Star, is the key, or central, to unlocking monies that were borrowed then taken out.

Good Star was the first big recipient of the outward transfers of MYR5 bn raised via AmBank with ‘Islamic’ bonds. After Good Star, the money was redistributed to various parties on a modus operandi that ran like this: 1MDB transfers to > Recipient company #1 > Other companies, #2 to #n then to > Individuals (including Najib, Jho Low et al).

This same method was repeated in every fraud that followed 2009, in 2012, in 2013 and 2014. Aabar BVI simply replaced Good Star as the primary Recipient company #1. The MYR5 bn Islamic bond issued through AmBank in 2009 was replaced by USD6.5 bn borrowed via the Goldman Sachs in 2011 and 2012.

In all cases, connivance, forgery, false representation and plain lying started from the top and in the heart of 1MDB:

• As late as 2016, Sharol Halmi and 1MDB board continued to say PSI owned Good Star although this was later discovered by the Parliament’s PAC as false.
• 1MDB continued to give money to PSI, USD2 bn in 2010 and 2011, although by then PSI had next to nothing to show other than what it produced on paper, and the 1MDB-PSI jv was turning belly up. That is, PSI had been talked up all along.
• Between 2015 and 2016, Arul Kanda continued to deal with Aabar BVI and al-Husseiny, accepting every word of the latter, in spite of the suspicious circumstances of the company’s set-up.

*

1MDB Ponzi Distribution Model

Below is the proto-model of the 1MDB ponzi scheme; it was actually launched (officially) by Najib Razak no less:

• Fraud #1: 1MDB-PetroSaudi International
• Total amount: USD1 bn from 1MDB to and for PetroSaudi JV.
• 1MDB source of fund: AmBank bond issue, MYR5 bn, Aug 2009

Remittance instruction date	Approving 1MDB officer	(Ostensible) Purpose of Remittance	Remitting account/bank	Recipient account/bank	Remitted amount	Final destinations
2009/09/30	Tan Keng Chee ED & Sharol Halmi CEO	Payment, 1MDB to PSI	Deutsche MY	1MDB-PSI/JP Morgan, Swiss	USD300mn	Tarek Obaid, ‘Prince’ Turkey, others
2009/09/30 – 10/02	Tan Keng Chee & Sharol Halmi	Payment, 1MDB to PSI (which owns Good Star)	Deutsche MY	Good Star/RBS Coutts, Zurich	USD700mn	Jho Low, Najib, others
2011 May – Oct	(Unspecified)	Muradbaha financing (2010)	Deutsche MY	Good Star/RBS Coutts, Zurich	USD330mn	(Undetermined)
Total outward remittance amount by 1MDB					USD1,030mn

*

Postscript: The Dao of Finance

The penultimate point in the essay which didn’t make clear or specific is borrowed from Li Lin Seet, Jho Low’s man in Singapore: it is called ‘gaming the system‘. That is, if Najib Razak and Low can, at our expense, make a fortune from loopholes within the system without getting caught, then so can we in the reverse.

Call it the Dao of Finance: the high and low define each other, the winners and the losers cause each other.

Restated, it means we can make a fortune with some or all of the money the two men took and, in the process, impoverish both and turning them into dogs and paupers. We fail in getting back the money, Malaysia loses, and this admits they are smarter than us, even collectively as a nation. Instead of beating our chest and shouting curses at the two men, it is better to act — only the will is require — because it can be done.

***

River flows … and never returns. Never.

 

 

A split down the middle.

Yeo Jiawei, this is your brother, Ah Jho. I’m writing to warn you: don’t you rat on me! Do you know who you’re dealing with, you piece of Singapore Hokkein shit!

If 1MDB is ‘victim’ then so must be Najib Razak

If victim, therefore innocent…

For Singapore to label Jho Low as something of a mastermind who has ‘gone missing’, and then, in the same breath, declare 1MDB innocent — a ‘victim’, it says — is astonishing in the Singapore cases against its bankers. Such a statement means a lot. It means, in particular, a turning point, one for Najib Razak to go one way, another for Jho Low to go another — jail.

From Singapore:

Prosecutors in Singapore said that Malaysian financier Low Taek Jho is the central figure in probes linked to 1Malaysia Development Bhd. and that he used money traceable to the state fund for his own benefit.

Low received “huge” sums of money, the prosecutors said in court filings made public on Wednesday. About $1 billion that 1MDB was purported to invest in a joint venture with PetroSaudi International Ltd. was diverted to a bank account beneficially owned by Low, according to the filings.

“The main victim in this case is 1MDB,” prosecutor Nathaniel Khng said in a Singapore state court. “Jho Low has gone missing from the public eye.”

***

Yes and noted, Ah Jibgor.

Peeling the Onion

Jho Low-Najib Reaches a Turning Point

*

Recall that there is nothing like this — ever — in the history of world finance: the government of Malaysia registers a shell company and, with it, borrows more than USD10 bn that most countries will have trouble raising even half, then empties the company, and the whole thing vanishes, from the existence of the board of directors down to Arul Kanda’s office furniture and toilet bowl.

For an investigator of this fraud, where then to begin especially since you are not lodged in Malaysia and you are from outside looking in?

In this circumstance, think therefore of 1MDB as onion with which you peel, starting from the outside. Naturally.

The first encounters would be people at the periphery, namely Yak Yew Chee of BSI Singapore, his subordinate Yvonne Seah and, separately Jens Sturzenegger of Falcon Bank. It is through these people that money is received on Jho Low’s behalf and then remitted. Or, the money may be received by Falcon, by other banks, and also remitted.

As the onion approaches the core center, you come to Yeo Jiawei, also of BSI. How does one know that Yeo is an important catch? Simply because, of the five persons convicted of 1MDB-related offenses, only Yeo travels in Jho Low’s private jet and spends time in the man’s house. These are not acts of an ordinary bank-client relationship although Yeo speaks of Low in the third person — ‘boss’, he calls him.

Although he take instructions, although he might map a plan or carry it out, Low can’t be the core because 1MDB is sovereignty and the sums are too big (for a boy his size). He might be the layer over the core, where there is one man and he only, not a pair or three-some.

At Yeo, you can establish the connective tissue between he and Low, and this is the 1MDB money. Now, here is the investigator’s dilemma: do you go on peeling or do you stop? If stop, where? At Yeo? Low or beyond?

The answer is probably, ‘Yes, stop’, because at the point of Yeo (and certainly at Low) the crime of money laundering reaches its limit. For example, it was not illegal for Low to remit money to Malaysia since it wasn’t illegal to receive it (from 1MDB or whoever).

Beyond Low what’s left of the money trail? Any money still with Low, if it has not already left Singapore (for, say, AmBank in Malaysia or Rothschild in Switzerland), it would have gone into fund investments, or to buy love, buy diamonds, condos, and so on.

Once the onion stops to be stripped, how is one to establish a connection between Low and Najib Razak? Money, specifically 1MDB money, is the only link, just as it was assumed that love was the connection between Low and Miranda Kerr.

Establishing the Low-Najib connection is vital because of about USD10 bn borrowed between 2009 and 2013 by 1MDB, at least USD8 bn was raised outside Malaysia and these, once taken out of 1MDB circulation, have to be parked somewhere, in some banks, before they are spent. Singapore has said nothing about how much in 1MDB’s money was passed through its banks; a good bet is USD2-3 bn. In Switzerland it is officially estimated at USD4 bn; in the US, 5 bn. (There are cases of overlap, of course.)

Assume USD5-7 bn (of 10 bn raised) were taken out of 1MDB’s circulation and control. That’s the theft. Remittances from Singapore to Najib’s personal bank account is about 700 million, that’s around 20 percent of 1MDB’s money parked at Singapore banks but is no more than 10 percent of grand total theft.

The Singapore trail-end of 1MDB’s money circulation is sketchy at best. Its investigators haven’t provided the robustness of evidence and clarity of transmission that one reads about in the DOJ court documents. Why?

Even Singapore’s five convictions so far don’t tie together as neatly as the connections that were strung among various people in the US. It is as if, in the convictions, each banker was an autonomous conduit. Singapore especially don’t detail a big picture view: how the money trail started, the sums involved at each stage of transmission, how these were spirited out of 1MDB, how they entered Singapore, who were the players, their relationships, the conduits, their respective roles, and, finally, where the monies ended up.

Quiet plainly, Singapore’s entire investigation and judicial process is a fucking PR exercise.

Even its central bank admitted as much: the entire show was designed to redeem Singapore’s reputation as a clean place. In other words, law and judicial enforcement wasn’t aimed at rooting out the thieves, the people at the core of the 1MDB web, but simply to clean house and to clear out the intermediaries, the facilitators, the fences, and not the looters. The result? Only bankers got it so far.

On the other hand, where it concerns Najib and the entire 1MDB board and management, there is next to nothing, with the consequence that they could still whistle away as they dress up each morning and drive to their offices.

Then, this week, out of the blue and for no explicable reason, something else happened with Yeo’s conviction: Jho Low was made to stand out of the pack.

Which is to say, criminality has now been presented at Low’s door step, which is an accusation that resulted primarily from Yeo’s testimonies. But, what exactly is Singapore’s charge against Low? Money laundering? Against a man who doesn’t work in the laundry, that is, the bank? Suppose it comes to that, getting to a formal charge, there appears so far only the evidences of Yeo’s to go with, which is the ‘boss’ and the underling relationship.

This isn’t the only predicament at Singapore (which, really, is their own fault because those guys were either incompetent or halfhearted in their jobs or both).

Another predicament: For Singapore to find some sort of criminality with Low, the money derived in his accounts has to be illegitimate. This means going backwards in the investigations, as opposed to the series of convictions so far which traced the money, first from having come out of nowhere seemingly, and then going forward one step at a time from account to account.

But, backward or forward, the complete 1MDB money transmission trail always starts and end outside Singapore, unlike the cases pending in the US. This then means that, where the prosecution of Low is concerned, the trail in Singapore has to stop somewhere in the middle. If so, so must the investigations and the prosecutions. (Najib remains out of the picture because the latter is not known to have accounts in Singapore where multiple 1MDB fund transactions took place.)

Low make a statement almost immediately after Yeo Jiawei was jailed 54 months (news item on top). This is uncharacteristic of Low who, after all, by his own account, as well as 1MDB’s, was never involved in 1MDB affairs or in its decision-making. Here, below is verbatim from an unnamed spokesperson for Low, probably some public relations (PR) agent:

This (the claim of victim-hood) is an example of overreach with a politically motivated act and selectively chosen narrative alleging 1MDB as a ‘victim’, when it has been clearly stated by the Malaysian authorities that there has been no misappropriation of 1MDB funds.

No wrongdoing has been proved in any jurisdiction relating to the alleged misappropriation of 1MDB funds, and this development in Singapore does not change that.

Mr Low is confident that any impartial party presented with the complete facts will see that the allegations are flawed, biased and create an inaccurate picture.

To say that 1MDB is the victim (and not the perpetrator) is to say someone victimized it. Going over the text, you can see how Low panicked after the Singapore accusation, thereby incriminating himself: ‘If you have nothing or little to do with 1MDB, why are you speaking for it? Because the only authority on 1MDB’s behalf is Najib.’

Now, toss the same, above arguments around: Four people in jail over 1MDB isn’t because the money they handled was illegitimate but because they violated Compliance rules and committed such acts as forgery and false representation. That’s also to say, the victim isn’t 1MDB or its money — indeed there’s no victim but merely breaches of Singapore’s financial regulations.

To now say there is a victim, and the victim is 1MDB, is to say, not only had there been looting going around but especially that the proceeds of the 1MDB’s funds raised (the USD10 bn) were all intended for a legitimate purpose. 1MDB, to repeat, is the victim after all. All this shifts the entire ground on which 1MDB has operated, especially when compared to the DOJ deposition that paints 1MDB as a vehicle in which various persons connected to it, persons in and out, committed mass thieving, deception and so on. In fact, it upends the DOJ’s accusation.

Until Yeo’s conviction, Low was named in court papers as simply, a ‘person of interest’. In defining him now as ‘central’ in the prosecution cases, and in calling 1MDB the victim, Singapore is very plainly suggesting Low is a swindler.

What’s shocking from Singapore, however, isn’t Low. It is this instead: to say 1MDB is a victim, then Najib, sitting in the onion core, is also a victim. That is, he is innocent of any and all losses resulting from the looting at 1MDB even though the company’s structural set-up, its conduct, transactions and deals, done through him and other officers, were from Day One deliberately false, misrepresentative, conniving and fraudulent. This included the purchases of land and power plants, and especially its fund raising and the deals made with the Arabs. Simply restated, 1MDB has been a front for fraud.

Two matters are in Low’s advantage.

• One, 1MDB isn’t run by him, a fact easily established both by inference and by evidence or absence thereof.
• Two, which is an extension of the first, says that if he has no control over 1MDB how could he have influence over it? Because, the flip side argument says that if Low cheated 1MDB, it describes a situation wherein one individual has actually taken on a sovereign power. A whole country!

Singapore court cases have only so far showed that monies transacted through its banks were done in highly questionable and in plainly illegal manners (forgery, false representation and so on). But, these cases say nothing about the legality or illegality in how the monies came to Jho Low. Indeed, it is on record that money went from 1MDB to Low’s accounts in an open, transparent fashion. This can’t be illegal.

More important for the purpose of rooting out the thieves of 1MDB is that Singapore has neither reveal nor has it establish who let out the monies and who then authorized their transfers to Low. Even in the DOJ, this crucial element is missing. If, however, such transfers are beyond Singapore’s powers to act or if there is nothing illegal in them then how is it to find anything wrong with Low’s accounts?

Hence, Low’s complaint that Singapore had ‘over-reached’. On this, he has a point and Najib is proof: “Mr Low Taek Jho has never worked for 1MDB and all decisions and dealings of 1MDB was done by the management and board of directors,” Najib had said in a written parliamentary reply to Wangsa Maju MP Tan Kee Kwong in 2015.

Why then did Singapore switched Low’s status — which the latter terms as, ‘this development‘ — from ‘person of interest’ to scammer? And, in so doing, not only painted 1MDB as an innocent party but ignored and then threw out its entire history of fraudulent conduct made repeatedly over six years?

Once 1MDB is declared a ‘victim’, a line is drawn the sand, with only one way to look at its looting: those outside and those inside. Inside is good, outside is evil. Those inside are clean and innocent; those outside, such as Low, are the predators, the swindlers and the fraudsters, their thieving conduct greased by greedy bankers. Those outside have nothing to do with those inside and there is, therefore, no relationship, financial or otherwise, between the like of Low and the like of Najib.

But, this Singapore denouement is not how things appear from Malaysia.

Where Malaysia’s interests are concerned, its singular focus is at the opposite end, the receiving end, in the causal chain of transactions that goes from 1. monies raised > 2. monies in 1MDB > 3. monies pass through bank systems > 4. monies in Najib.

Stage 4 is the thing to nail Najib.

Singapore sits at Stage 3 and now says that there is no Stage 4 (again, see news item at the top of this post). Everything stops at Stage 3. Simply, it is saying that 1MDB, the victim, was defrauded and Low made off with the money, ruining Singapore’s clean reputation in the process.

With this inference, you can see why Low must have been so incensed that he quickly dashes off a statement and, in it, talked of ‘political motivations’ (a Najib-Singapore deal?) and then reasserted the repeated claim that nothing had been misappropriated from 1MDB. This line of defense is not mere regurgitation of Salleh Keruak or Apandi Ali.

The force in his legal reasoning lay in this: If there’s no misappropriation, then there’s nothing illegal about the money in his accounts. He could even say, these are gifts from Malaysia. Low is saying to Singapore thus:

All you have are some guys who broke banking and Compliance rules. On me, personally, you have nothing. But to call me a swindler where is the proof? Or, have you made a deal with Najib to sacrifice me because I want to remind you — and Malaysia — this, ‘If there is no misappropriation, if there’s no fraud, how can there be a victim’?

In a sense, Low is also warning Najib about the political motivations: ‘don’t fuck around behind my back’. In popular parlance: you aren’t going to throw me under the bus and get away with it.

The Chinese say, Joey is pointing to the plum tree while scolding the apricot.

Even so, for Singapore to take this extraordinary step — to make ‘this development‘ — suggests that Low might be done in. Or, at the minimum, there is going to be a parting of ways between thieves.

*

Details in image below. Also see, charge sheet.

The diagram above shows just one of five transactions (another is here, in 2013, USD3 bn, involving the usual cast of characters with Tanore replacing Blackstone.) It started with USD790 million on a October day 2012. Two weeks later when it arrived at Low’s Selune account in Switzerland there was still USD110 million in spare change.

Holy Jesus shit! Even the Swiss authorities noticed and that began the process of a cover up, including forgery and false representation. Enter, thus, Yak Yew Chee.

With that sort of money lying around, you could hear them scream: “I want in!” Seeing USD790 million, people like Yeo Jiawei would have spent nights just working out his share and how to cream it off. “The earth moved under my feet,” sang and tweeted Li Lin Seet (below, or is it Seet Li Lin?), Low’s underling and assistant operator.

With money like this, backed by a sovereign power, Singapore’s laundering role becomes inevitable: All very human for its bankers. That, after all, was how they were taught and trained to think at Wharton, in MBA classes, and once they are indoctrinated into the finance world, the Anglophile material culture. In all Yak made off with USD18 odd million (mostly forfeited since).

In the diagram above, note two things: (a) the prevalence of the name Low Taek Jho, whose ghost name is Tan Kim Loong, also Eric Tan, and (b) Blackstone, which was the funnel for some petty cash from Singapore to Najib’s private AmBank account. That’s another story, though.

What’s pertinent is this, and it is from the courts:

This masking and circular flow of funds from Jho Low (vide the ADKMIC BSI Account) to his father and back to Jho Low was described by an officer from BSI Compliance on 6 November 2012 as “nebulous to say the least and not acceptable in Compliance’s view”. Subsequently, Jho Low declared via e-mail on 7 November 2013 to BSI (enclosed and marked “H”) that he had decided to give to his father wealth which he had generated “as a matter of cultural respect and good fortune that arises from respect”, and his father had decided to accept a token sum and to give the rest back to him. Inexplicably, these pass-through flows were eventually processed after a senior BSI officer commented that “intra family transfers are not always going to be logical”.

That is, bankers will made exceptions to Compliance rules once ‘family’, ‘culture’ and almost certainly when ‘religion’ or ‘god’ or ‘royalty’ are invoked. But even that’s not the point about the Yak case.

The point is this instead, Najib Razak invoked an identical excuse on the USD681 million transferred from Tanore, after which Apandi Ali exonerated him as a ‘royal gift’, provided in the name of Allah, with which Najib then kept ‘a token sum and returned the rest’. That is, in the paraphrasing of the senior BSI officer, the money back and forth was an “intra-family transfer” affair.

Both Hisham and Najib have often referred to the Saudi towel heads as ‘Brothers‘, with a capital B. Bingo! No case.

Hey, my ‘Captain’ Brother Ahi: Singapore mess up on 1MDB, did you say? Mess up: You want to suck my dick, Brother?

And Joey boy: Is that what they teach you at Wharton’s? Culture, god and respect? You’re outdated, Brother! Don’t you know? God is dead! Dead for a 100 years already. And we are free…. Imagine, free to do as we like!

*

***

On paper, above, it looks easy; it goes by linear progression and the point of the investigations in Singapore and the US centered primarily on the middle process — the money laundering — linking 1MDB in the beginning and MO1 in the end. But looking for money misappropriated from 1MDB is like looking for your own eye in the face. You’ll have to use a mirror and even there it is just an allusion, not reality.

When 1MDB is also MO1, you will have to call on the victim who’s simultaneously the thief, a contradiction. This is the crux of Low’s contention in his rebuttal to Singapore. The victim (1MDB), he adds, has repeatedly said so, nothing is missing from the house.

Singapore’s latest prosecution and conviction of Yeo Jiawei concerns the ‘October 2012 Aabar/BVI Phase‘. This is the second tranche of USD3.5 bn raised by Goldman Sachs for 1MDB in 2012.

***

Joey & Miranda (continued)

Jho’s Double Tragedy: Ditched Once, Ditched a Second Time.

Jho Low, the man everybody loves to hate. Cut him some slack, wil’ya!

He has already lost a girlfriend and now those Singapore assholes call him… mastermind, a runaway, ‘missing from the public eye’ as if he has the pubics of the world under his thumb. What pubic? What eye?’

Fuck the public! They worry for a White girl and diamonds more than for a poor Chinaman who have done so much for the kids and for the sick. What a racist world! And now the only person in the world who can save him is also going to ditch him. Sigh….

In despair, Low dashes off a message to Old Flame:

‘Miranda, you must have read the news. But stop smirking. Keep the love I gave you, it’s eternal, but give me back my diamonds! Don’t you see, it’s all I have left. They have taken everything, my paintings, my house, my hotel, my money, my friends — everything! They took especially you, my darling love… have you any idea how it pains me? Those Singapore Anglo and Yankee motherfuckers.

***

Safe journey, Joey 相思的債

(Can you read hanzi?)

***

Why Najib Couldn’t Be Evil…

But if all the readers of Malaysiakini thought Najib is evil then they are so as well — equally evil, absolutely evil. All of them, including Steven Gan, Clare Rewcastle Brown, Mahathir Mohamad, but who couldn’t see their own evil unless it’s projected in the person named Najib Razak.

By what standards, therefore, you judge Najib?

Najib is beyond evil, just as manure is the contribution to the smell of the rose. Don’t understand, dear Anglo Mkini reader? Then fuck off.

***

Think, Tong Anglo Chinaman

The Thoughts of Liew Chin Tong

Chin Tong in Malaysiakini:

Fortunes built from decades of hard work and proceeds from currency speculation in the 1990s were wiped out within months, if not days, in the first major contagious regional crisis in recent memory, before the far greater global crisis in 2008.

Our generation was not supposed to start off our adulthood this way.

Whose fortunes? How were these fortunes made? Other countries near and far (from Singapore to Hong Kong and South Korea) have equally made fortunes, those weren’t wiped out. Why? If “our generation” wasn’t “suppose to start off… this way” then how was it suppose to start out? With a silver spoon inside your ass?

Chin Tong again:

Between the 1990 and 1997, after defeating the opposition, Mahathir totally transformed the perception towards him through a bold proclamation of the national objective to become a developed nation in 2020 and the need to provide for a common destiny in a multiethnic society – Bangsa Malaysia – and delivered massive growth hitherto unheard of. It was the era of trickle-down economics.

The 1997 Asian Financial Crisis shattered those dreams….

Mahathir transformed the perception? What was the perception before that? How is a perception ‘transformed’ by a single proclamation? Or even a series of proclamations? Which is the greater or are they the same: the perception of transformation or the transformation or the proclamation itself? How do you create, or in Chin Tong’s word, “provide a destiny”? Does he mean to say, a multi-ethnic society had different destinies to begin with? What is this destiny? How is a Bangsa Malaysia a fucking destiny? Is that supposed to be your shattered dream?

Chin Tong, for the third time:

I read history with a sigh. Had Anwar challenged Mahathir in June 1998, he could have won. Or at least he would not have been isolated. But what had happened cannot be reversed. While the nation stagnated economically and Malaysians became less hopeful, Malaysia saw tremendous change politically in the intervening years.

I would not have entered full-time politics at such a young age if not for the inspiration from Anwar’s Reformasi movement.

You read history, really? Why sigh, Mr Liew? Because history wasn’t your version of it? What kind history would fit your liking? Is it this kind of history: Anwar challenges Mahathir, Anwar win? How do you know? “What has happened cannot be reversed” — is that supposed to be some mystic guru profoundness we don’t know about? “Stagnated economically” is what? GDP growth a year at 5 percent instead of 8? Is that some new economics we know nothing about? “Less hopeful” is because of what: you seem to think it’s economics, Yes? Mahathir boom years, therefore hopeful. Stagnating years, therefore less hopeful? Tremendous political change? What had changed? Better yet, what changed fundamentally? The inspiration from Reformasi? What reformasi? What do you reform on the reformed? Mahathir was supposed to be the reformation, No? And what do you want out of the reformation of the reforms?

You see, Mr Liew, you are virtually the flip side of this man named Tan Keng Liang. Both of you think the same fallacies, made the same stupidities, repeat the same myths, only they come from the opposite directions concerning transformation, reform, politics, economics, inspiration, change, both as inane as is their language and as insipid as is their speech made of air, all very woolly, full of fluff amounting to nothing. It reads nice, like a pillow even comforting, and like Anwar full of reformasi words, of promises, of change. That’s the history, No? But that’s it.

And then you talk about ‘redemption’. What’s that? This is some fucking Jesus business? We, our generation, as you say, had enough, so, please, piss off….

You are a fucking joke.

***

来呀来个酒啊不醉不罢休