GST : Why Najib is Laughing

Prime Minister Najib Razak, reluctantly, has announced a revised Budget 2016. Clearly, it was a tough job to further decorate the budget so that it doesn’t sound too gloomy. When Budget 2016 was unveiled in Parliament last October, the crude oil price was at US$48 (RM199) per barrel. Today, it stands at US$35 (RM145), after a rebound from US$27 a barrel.

When Najib unveiled the Budget 2016 last October, he trumpeted lots of goodies – a growing GDP, reduced fiscal deficit, reduction of poverty, lower unemployment, more free money through BR1M and whatnot. But even then, the national budget was a problematic one because the “Operational Expenditure” of RM215.2 billion constituted 80.5% of overall budget.

What this means is for every RM100 of revenue collected, a disturbing RM80.50 goes to running the government such as salary, rental, maintenance, utilities bill, travel expenses and the list goes on. After getting used to lavish spending and cuts in the initial Budget 2016, there was little room for Najib to get anymore money, lest he wished to cut government servants’ wages.

In the latest budget revision, PM Najib Razak who holds a second job as the Malaysian Finance Minister has presented 11-calibration. Out of them, only 2 recalibrated measures should interest you – EPF and GST. The notorious 6% GST has been retained, for obvious reason. Since its introduction on 1 April, 2015, a staggering RM51 billion was collected.

Naturally, Najib can afford to smile and grin from ear to ear because without this new cash-cow, his government would have collapsed. And he took the opportunity to remind (or rather threaten) the Malaysian’s 1.6-million civil servants, majority of whom support Najib’s UMNO political party, that they can keep their jobs because of GST.

But was it true that the 1.6-million government servants would be jobless had the GST not implemented? Petronas said it will pay RM16 billion in dividend to the government this year (2016), down from RM26 billion in 2015 and RM29 billion in 2014. In his 2016 Budget, PM Najib estimated Malaysia’s oil related revenue at RM31.7 billion this year compared with RM44 billion in 2015.

In other words, the government would collect RM12 billion less from Petronas, including dividend, taxes and export duties this year. Big deal!! But Najib regime is pocketing RM24 billion every year, thanks to the abolishment of fuel subsidy. The RM24 billion in saving is more than enough to cover the RM12 billion temporary losses from Petronas.

This also means even without the RM51 billion in GST collection, there’s no reason to cut any of the 1.6-million government servants if the money is prudently spent. Essentially, the money collected from 6% GST is extra money “forced” from the 30-million reluctant Malaysians. But hey, RM51 billion in government’s pocket is better than in peoples’ pocket.

In a family of five, Najib administration has squeezed at least RM8,500 from each family in 2015 alone. And whenever the finance minister likes, he can increase GST’s rate further. That’s precisely why the 6% GST remains in the 2016 budget revision. GST is an extremely lucrative cash-cow for Najib’s own survival because he can use it to give “gifts” to 191 UMNO division chiefs (*grin*).
Najib Razak - Laughing - GST Collection RM51 Billion.

The smartest move in his budget recalibration was the 3% reduction in EPF contribution by employees. It would be great if employees pay 3% less but the same quantum is offset by the government. But that was not the case. EPF contributors are forced to spend their retirement fund in “advance” so that the government doesn’t have to find money to make ends meet.

By Najib’s own estimation, the reduced EPF contribution would boost spending by RM8 billion. It was a clever move because the government would have the opportunity to slap 6% GST on the RM8 billion to make additional RM480 million. It was like a bank forcing you to take “cash advance” on your credit card so that they can charge you processing fee.

EPF contributors would have 3% less in their saving – every month – from March 2016 until December 2017. Therefore before one applause and get excited about having extra cash to spend every month, one has to realize that the so-called extra cash was yours in the first place. Because financial wizard Najib Razak didn’t know how to get money, he has chosen to squeeze it from your retirement fund.

Actually, the government is broke. Allocation to the Poor Students’ Trust Fund (Kumpulan Wang Amanah Pelajar Miskin) was cut from RM200 million to merely RM10 million. Higher Education Ministry’s budget was reduced by RM2.4 billion to RM13.378 billion. Plantation Industries and Commodities Ministry saw a 60.76% reduction to its budget from RM1.659 billion to RM651 million.

The Transport Ministry saw a budget reduction of RM648 million. Energy, Green Technology, and Water Ministry was short by RM605 million. Defence Ministry saw its budget cut by RM459 million. These budget cuts, announced during 2016 Budget last October, would save RM5.3 billion. But Najib wanted RM8 billion more of your EPF money.

Najib's Submarine Scorpene is Coming!

The very day after Najib Razak’s own appointed Attorney General refused to press the charges recommended by the Malaysian Anti Corruption Commission against the Prime Minster, France opened its own court case …. into further corruption by Najib!

The case relates, of course, to the long-running scandal over the blatant kick-backs paid by the French defence contractors Thales to secure the Scorpene submarine contract when Najib was Malaysian Minister of Defence.

The details of the case and the huge sum of 114 million euros, which were paid to a shell company Perimekar owned by Najib’s personal negotiator in the case, Razak Baginda, have been widely exposed in both Malaysia and France.

And yet it is only in France that action has at last been taken. Why?

"The case of French submarines sold to Malaysia in 2002 surfaced in court: a first indictment was issued against the former boss of an international subsidiary of Thales, suspected of having corrupted the present Prime Malaysian minister..." Le Point
“The case of French submarines sold to Malaysia in 2002 surfaced in court: a first indictment was issued against the former boss of an international subsidiary of Thales, suspected of having corrupted the present Prime Malaysian minister...” Le Point

After all, it is the Malaysian public who paid for all this graft and so are the principle victims in this case.  Why are the forces of law and order in Malaysia turning a blind eye, therefore, to the purchase of three lousy second hand submarines, which have proved entirely unfit for purpose, to the tune of billions of ringgit, in combination with a massive kickback to the assistant of the key decision-maker in the deal, who was Najib Razak?

Malaysians of course know why and with the case now finally coming before the courts in France, with their own Prime Minister Najib Razak cited at the top of the official prosecutor’s charge sheet as the named recipient of these bribes, their national shame is complete.

Not just corruption but murder

Azilah Hadri the senior officer in the murder team has applied for a royal pardon – the grounds are believed to have been approved by Najib

Of course, as widespread evidence and public coverage has also amply informed the world at large, there was another shocking victim of this Scorpene affair, which makes it a case not only of financial corruption, but of murder.

Altantuya Shaaribbuu was the pretty interpreter used by Najib and Baginda in these dealings and as copious court documents and sworn statements have shown, she was threatening to expose these French bribes unless she got a US$500,000 payment to help her with a pregnancy she had incurred in the process.

She had taken to shouting her woes, supported by a group of close girlfriends from Mongolia, outside of Baginda’s house and it was from here that in 2006 she was abducted by two bodyguards who were working directly for Najib Razak and driven to a lonely spot and shot.

Weapons grade C4 explosive (only accessible through a signed authorisation from the Minister of Defence) was then wrapped around her offending midriff and she was blown to smithereens.

Unfortunately for the murderers, a local fishermen heard the explosion and called the police who detected the remote bomb-site.

Fellow murderer Sirul Azah Umar  has been represented by Najib's lawyers while detained on the run in Australia. He too is expecting his freedom soon.

Fellow murderer Sirul Azah Umar has been represented by UMNO party lawyers while detained on the run in Australia. He too is expecting his freedom soon.

They also detected the cellphone trails of the two bodyguards leading to the spot and obtained witnesses to the kidnap and eventually the signed confessions of both men. A good job by the Royal Malaysia Police force that could not easily be swept under the carpet.

The bodyguards were convicted and sentenced to death, but their subsequent attempts to gain release and the stories of what happened to various other witnesses in the case have kept Malaysian’s gripped by the story ever since.

Suffice it to say that the bodyguards have claimed that they were scapegoats, but represented as they are by Najib’s own UMNO party lawyers, they have declined to explain why they murdered a woman they didn’t know in such a way.

Both men now have pleas for clemency before the King.  It is believed that they will receive this clemency in return for their silence and a fat pay off.  Indeed, texts from Sirul to his lawyers obtained by Al Jazeera have revealed blackmail threats from the bodyguard demanding cash and freedom to be negotiated with the Australians in return for his silence.

“This way I won’t bring down the PM”, texted Sirul.

So, it seems that Malaysia has become a place where billions can go missing from public funds; where hundreds of millions can turn up in the Prime Minister’s bank accounts (many directly traced to public funds) and where murderers get let off if they worked for the Prime Minister.

In short, it is on the brink of becoming a nasty dictatorship, as anyone who has tried criticising Najib in the face of  his brand new media, defamation and ‘anti-terrorism’ laws well knows.

Najib’s eventual problem may turn out to be that other countries retain the rule of law and that his reputation can no longer be covered up merely by appointing his own officials to “clear” him in Malaysia.

Najib Used Funds for Lavish Spending: Report

The indebted state fund 1Malaysia Development Berhad on Thursday challenged an American newspaper report alleging that money linked to 1MDB went into Prime Minister Najib Razak’s spending on lavish holidays, shopping and jewelry.

The Wall Street Journal (WSJ) on Thursday reported that Najib spent up to U.S. $15 million (58.1 million ringgit) on holidays and luxury goods at stores in the United States, Malaysia, Italy and elsewhere, based on a probe into his personal banking records.

“1MDB has consistently maintained that it has not paid any funds to the personal accounts of the Prime Minister,” 1MDB said in a statement responding to Thursday’s article in the Journal.

The state fund has been tied to financial scandals surrounding the prime minister. These have led to calls for his resignation since the Wall Street Journal first broke the story in July 2015 that nearly $700 million in 1MDB-linked money was deposited into Najib’s private bank accounts.

As of late Thursday (Kuala Lumpur time), the Prime Minister’s Office had not issued a statement in response to the article.

The money spent on holidays and shopping came out of private bank accounts in Najib’s name, into which, investigators believe, hundreds of millions of dollars were deposited since 2009 – much of it money originating from 1MDB – the Journal reported in its latest article, citing official investigative documents.

The Journal claimed Najib spent U.S. $130,625 (506,238 ringgits) at Chanel in Honolulu two days before a Christmas Eve golf match with U.S. President Barack Obama in 2014.

“The transaction in the Chanel store was paid for with a Visa card in Najib’s name, according to the Malaysian investigation documents. At first, the transaction didn’t go through and Najib, who was present, had to call his bank to approve the charge, said one of the people aware of the shopping trip,” the Journal reported.

According to its article, the money came from SRC International, a former unit of 1MDB, which Najib chairs.

“On the day Najib played golf with Obama, SRC International transferred a further U.S. $9 million (34.8 million ringgits) to the account via 1MDB’s corporate social responsibility arm. The money arrived the day after Christmas.”

In addition, the WSJ reported, documents showed that Malaysian luxury clothing retailer Jakel Trading Berhad received more than U.S. $14 million (54.2 million ringgit) from Najib between 2011 and 2014. Documents also showed a purchase U.S. $56,000 (216,834 ringgit) at a high-end car dealership in Kuala Lumpur on June 28, 2011.

Report names Najib’s brother

The WSJ report also claimed that Najib’s younger brother, CIMB Bank Chairman Nazir Razak, received U.S. $7 million (27.1 million ringgit) to be distributed among politicians ahead of Malaysia’s general election in 2013.

Nazir confirmed in a written statement that he did receive the sum, which was disbursed by the bank staff officials of the United Malays National Organization (UMNO) – the party that heads Malaysia’s ruling coalition – according to instructions from party leaders.

However, Nazir told WSJ, he believed the money was from donations that he helped raise from Malaysian corporations and individuals for the elections, but he was not sure of any other funding source.

“I had no knowledge whatsoever that these funds may have originated from any other source(s),” the WSJ report quoted Nazir as saying.

Najib maintains innocence

In January, Malaysian Attorney General Mohamed Apandi Ali announced that his office was closing investigations into the 1MDB-linked corruption scandals facing Najib, particularly one involving a deposit of U.S. $681 million into his private bank accounts before the 2013 election – as reported by the Journal in July.

Apandi said no criminal offense had been committed, that most of the money had been returned, and that it was a “personal donation” from Saudi Arabia’s royal family.

Najib has maintained he never took any of the money for private gain. But soon after news of the scandal broke in July, he sacked Abdul Gani Patail, the attorney general at the time who was heading an inter-agency task force probing that and other scandals associated with 1MDB.

On Thursday, 1MDB took a hard line against the latest Wall Street Journal report. Apart from repeating earlier denials that 1MDB never paid any money into Najib’s accounts, officials reiterated their earlier claim that the money came from Saudi Arabia.

“‪Despite this, the Wall Street Journal continues to repeat the same allegations, without providing any concrete evidence to justify these claims,” 1MDB said in a news release.

Najib's Scandalous Goldman Sachs Connection under Investigation

The Financial Times reported more breaking news of Najib's widening worldwide scandal:

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Goldman Sachs hired the daughter of a key ally of Malaysia’s prime minister at a time when the US bank was seeking to expand its business in the country, it emerged on Thursday.

The bank made the appointment as Tim Leissner, then Goldman’s co-president for Southeast Asia, was working to forge closer business ties in Malaysia, where it would later win valuable business with the government’s 1MDB investment fund.

Investigators are probing allegations of misconduct and the suspected misappropriation of state funds in relation to 1MDB, whose advisory board is chaired by Najib Razak, Malaysia’s prime minister.
Goldman was granted a licence to operate in Malaysia in December 2009 and began pitching for business. Mr Leissner later played a key role in controversial bond sales for the fund.

In 2010, Goldman hired Anis Jamaludin, daughter of Jamaluddin Jarjis, a Malaysian politician and close confidant of Mr Najib. She worked for the bank as an analyst for months, a person familiar with the matter said.

According to a LinkedIn page in her name, Ms Anis worked for Goldman as an investment banking analyst in Singapore from July to November 2010. Ms Anis could not immediately be reached for comment.

Goldman declined to comment. Neither the bank nor Mr Leissner is accused of wrongdoing.
Western banks have come under scrutiny for their hiring practices in other parts of Asia, notably China. The hiring of friends and relatives of Chinese officials is perceived as a way to win regulatory approval and business from state-owned enterprises.

Jarjis, a senior member of the ruling UMNO party and former Malaysian ambassador to the US, died in a helicopter crash last year. A key adviser and fixer for Mr Najib, his death was viewed as a blow to the prime minister. After his death, Mr Najib described Jarjis as a “friend of many years”.
The Big Read

Mr Leissner was named chairman of the bank’s Southeast Asia division in 2014. He went on leave in January and resigned last month. His departure is connected with an unauthorised personal reference he wrote on behalf of another individual, according to people familiar with the matter.

The financier was central to Goldman’s involvement in capital raising for 1MDB. The US bank arranged three bond sales for 1MDB in 2012 and 2013, which raised $6.5bn.

The Monetary Authority of Singapore said in a statement this week that it was “co-operating actively” with several jurisdictions over the 1MDB affair. The Singapore regulator said Mr Leissner was based in Singapore from 2002 to 2011 and moved to Hong Kong in November 2011.

The MAS said Mr Leissner “was not based in Singapore when his alleged involvement in the 1MDB deals took place”.

While Goldman said in July 2014 that Mr Leissner would be relocating back to Singapore, the city-state’s authorities said this relocation did not materialise.

The 1MDB affair has rocked Malaysia, with Mr Najib coming under pressure to explain $680m that flowed into his personal bank accounts. Mr Najib denies wrongdoing, saying the money was a political donation, while 1MDB denies its funds have been misappropriated.

The hiring of Ms Anis by Goldman was first reported by The Wall Street Journal.
Mr Leissner’s lawyer could not immediately be reached for comment.

More than US$1 billion was transferred into Najib's accounts from 2011 to 2013: WSJ

As suspected by all human beings with some brains, deposits into Malaysian Prime Minister Najib Razak's bank accounts ran to hundreds of millions of dollars more than previously identified by probes into state fund 1Malaysia Development Berhad, the Wall Street Journal reported on Monday.

Citing two unnamed people familiar with flows into Najib's accounts and a person familiar with one overseas investigation, the report said that more than $1 billion was deposited from 2011 to 2013, far more than the $681 million earlier identified.

The paper said global investigators believe much of the $1 billion originated with the state fund, known as 1MDB, but did not specify where the extra money came from or what happened to it.

The report contradicts a conclusion reached recently by Malaysia's chief law officer.

Attorney-General Mohamed Apandi Ali cleared Najib in January of any corruption or criminal offences, saying the $681 million transferred into Najib's account was a gift from a member of Saudi Arabia's royal family and that most of it was returned.

A government spokesman said Malaysian authorities had gone to Saudi Arabia to "examine documentation" and interviewed members of the royal family and officials who handled the donations.

"As stated by the attorney-general of Malaysia, the funds received were a donation from Saudi Arabia," the spokesman said in a statement in response to the latest report.

Najib has been buffeted for months by allegations of graft and financial mismanagement at debt-burdened 1MDB and in particular by revelations of the transfer of around $681 million into his account in 2013.

He has denied wrongdoing, saying the funds were a legal political donation and he did not take any money for personal gain.

The Wall Street Journal report said money beyond the $681 million arrived in Najib's account in 2011 and 2012.

It said investigators in two countries believed funds originated from 1MDB and moved through a complex web of transactions. Najib is chairman of the board of advisors to IMDB, a fund set up in 2009, when he came to office, to invest in projects of national importance.

In response to the WSJ report, 1MDB said it has consistently maintained that it has not paid any funds to the personal accounts of the Prime Minister.

"This has been reiterated by multiple lawful authorities including the Malaysian Anti-Corruption Commission, the Malaysian Attorney General, and various reputable international publications, who have confirmed that these funds came from Saudi Arabia," it said in an email response.

Probes into the fund's finances have been opened in Malaysia, the United States, Switzerland, Hong Kong, Singapore and Abu Dhabi, the Wall Street Journal said.