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Saturday, January 19, 2019

Goldman Sachs must follow up on its apology with US$7.5bil compensation in 1MDB scandal

https://youtu.be/XxwX8CRvSks

Goldman Sachs Group Inc should follow up on its apology to Malaysia with a payment of US$7.5bil (RM30.86bil), says Lim Guan Eng.

The Finance Minister said a mere apology from the investment bank over the scandal-ridden 1Malaysia Development Bhd (1MDB) is not enough, unless they pay reparations and compensation.

Lim said Goldman Sachs should understand the agony and trauma suffered by Malaysians as a result of the scandal.

“An apology is not enough.

“An apology with US$7.5bil is what matters.

“At least he (Goldman Sachs CEO David Solomon) accepted that they have to bear and shoulder some responsibility but that is insufficient.

“They have made provisions of around US$561mil (RM2.3bil) but that is not adequate.

“We are seeking US$7.5bil,” he told a press conference here yesterday after announcing the names of the joint lead arrangers for the Samurai bond.

On Thursday, Solomon apologised to Malaysians for former banker Tim Leissner’s role in 1MDB.

Solomon also said it was very clear that Malaysians were defrauded by many individuals, including the highest members of the previous administration.

Asked if Malaysia would drop charges against Goldman Sachs with the US$7.5bil payment, Lim quipped: “US$7.5bil ... then we can discuss lah”.

Lim added that it was very clear who the top government official Solomon was referring to as there could only be one person.

“You worked hand in hand, and there has to be accountability. It also involved a breach in fiduciary duty, and I think the banking industry has this obligation to make good the losses that we suffered.

“I think this is at least an admission.

“If not for the change of government, do you think Goldman will apologise? We’re dealing with the largest investment bank in the world,” he said.

Lim added that he found it distressing that Datuk Seri Najib Tun Razak still refused to admit there was something wrong with 1MDB and the entire exercise.

He also lambasted the former premier for passing the buck to Goldman Sachs, and for being in a state of denial for refusing to admit that Malaysians suffered huge losses due to the scandal.

By Royce Tan The Star

Goldman Sachs CEO apologises for ex-banker’s role in 1MDB scandal

NEW YORK: Goldman Sachs Group Inc chief executive officer David Solomon (pic) has apologised to the Malaysian people for former banker Tim Leissner’s role in 1Malaysia Development Bhd (1MDB) scandal, but said the bank had conducted due diligence before every transaction.

Goldman is being investigated by Malaysian authorities and the US Department of Justice (DOJ) for its role as underwriter and arranger of three bond sales that raised US$6.5bil (RM26.7bil) for the sovereign wealth fund.

US prosecutors last year charged two former Goldman bankers for the theft of billions of dollars from 1MDB. Leissner, a former partner for Goldman Sachs in Asia, pleaded guilty to conspiracy to launder money and violate the Foreign Corrupt Practices Act.

“It’s very clear that the people of Malaysia were defrauded by many individuals, including the highest members of the prior government,” Solomon said on conference call discussing the bank’s fourth-quarter results in a report by Reuters.

Solomon said Leissner denied the involvement of any of Goldman’s intermediaries in transactions with 1MDB.

An attorney representing Leissner did not immediately respond to a request for comment.

Roger Ng, the other charged former Goldman banker, was arrested in Malaysia at the request of US authorities and is expected to be extradited, according to John Marzulli, a spokesman for the prosecution.

The DOJ has said that US$4.5bil (RM18.5bil) was allegedly misappropriated by high-level officials of the fund and their associates between 2009 and 2014.

As part of Goldman’s due diligence efforts, Solomon said the bank sought and received written assurances from 1MDB and International Petroleum Investment Co (IPIC) that no third parties were involved in the first two bond sales.

Abu Dhabi’s IPIC had co-guaranteed the 1MDB bonds when they were issued in 2012.

In the final offering, the Malaysian government itself, along with 1MDB, represented that no intermediaries were involved, he said.

“All these representations to Goldman Sachs have proven to be false,” Solomon said.

Goldman Sachs did not disclose any other information about its involvement with 1MDB, but said the impact on its client franchise had been de minimis. Shares of the bank, which reported strong fourth-quarter results earlier in the day, have fallen over 25% in the last three months, after headlines about its involvement with the sovereign wealth fund emerged.

The Malaysian government said in December it was seeking up to US$7.5bil (RM30.8bil) in reparations from Goldman over its dealings with 1MDB. – Reuters

In an immediate reaction yesterday, former Prime Minister Datuk Seri Najib Tun Razak said Goldman Sachs had to take responsibility because they were appointed and paid by 1MDB to take care of Malaysian’s interests.

“We put up a system, the system was there to take care of our interests, you see.

“So if they fail, then they have to take responsibility, because they were appointed and paid by 1MDB to take care of our interests,” Najib said.- The Star

Related:

Goldman Sachs CEO David Solomon apologises for ex-banker's role in 1MDB scandal

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Rightways - Sowing the seeds of Success: Think Global, Act Local; Change & Grow Rich; Sow as You Reap & Soar High! Richard Tan MBA(UK), BCA(NZ), AMA(USA),MMIM

Goldman Sachs must follow up on its apology with US$7.5bil compensation in 1MDB scandal

https://youtu.be/XxwX8CRvSks

Goldman Sachs CEO David Solomon apologises for ex-banker's role in 1MDB scandal

righways

Rightways - Sowing the seeds of Success: Think Global, Act Local; Change & Grow Rich; Sow as You Reap & Soar High! Richard Tan MBA(UK), BCA(NZ), AMA(USA),MMIM

Friday, January 18, 2019

Clean up the graft and power abuse at Human Resource Training & Development provider HRDF

https://youtu.be/fuk3xC6M0ow https://youtu.be/JrJ0V3TIskc https://youtu.be/CT8dgpCh_2w

Scandal-hit: The clean-up at HRDF appears to be far from over.

Questions over HRDF Bangsar South property

PETALING JAYA: The clean-up at scandal-hit Human Resources Development Fund (HRDF) appears to be far from over.

In fact, to add to its woes, details have recently emerged about the possible mishandling of a multi-million ringgit property acquisition.

The HRDF management has made police reports claiming there was misconduct or abuse of power in the purchase of part of a building in Bangsar South, Kuala Lumpur, four years ago, because it was done without the knowledge of the board of directors and the investment panel.

HRDF bought six floors of a “landmark skyscraper” for RM154mil, including goods and services tax (GST). It has been alleged that some RM40mil was paid even before the issuance of the tax invoice.

But the bigger issue, according to sources, was that the HRDF’s board of directors had actually approved the purchase of a different piece of property – another building, also in Bangsar South, for RM141mil before GST.

It was learnt that the investment panel was only informed of the switch five months after the first tranche of RM15.4mil had been paid.

The sources confirmed that the HRDF has gone to the police and investigations are underway.

An agency under the Human Resources Ministry, the HRDF manages a fund comprising contributions from employers for the purpose of training and development.

In November last year, minister M. Kulasegaran said staff and management personnel were running HRDF as if it was their own company and that the management had in some instances exceeded authority and approved projects beyond its approval limits.

This latest accusation regarding the Bangsar South purchase reflects the same governance problems.

“The board was also informed that the minister (at that time) approved the change of the property to be acquired,” said a source. “The sale and purchase agreement was signed by the chief executive officer prior to the approval of the investment panel and the board.”

The first RM40mil of the purchase price was paid in eight tranches.

The source said under the Pembangunan Sumber Manusia Bhd Act 2001, the minister could only direct the board on matters and was not empowered to approve or consent to entering into agreements.

The remaining RM114mil was paid after the signing of the agreement. The six floors of the Bangsar South building were handed over to the HRDF in March 2017.

Documents sighted by The Star showed that the investment panel voiced its intention to invest in property in a meeting at the end of 2014.

In February 2015, the board of directors approved a proposal to set up a reserve fund and an allocation of RM250mil.

It was stated by the CEO then that the property would be for HRDF’s use.

Another approval came two months later for the RM141mil property.

In May that year, the first payment of RM15.4mil was made, but for the property that cost RM154mil. This was also when the agreement was inked, said the sources.

Five months after receiving the keys in 2017, the investment panel decided to rent out the office floors. The board agreed with this move.

In May last year, the HRDF began paying service charges of RM66,670 per month for its Bangsar South property. Only one floor out the six has been rented out, giving a monthly income of RM115,168.

Surprisingly, the board of directors agreed in March last year to purchase two additional floors in the same building to be used as HRDF’s office.

Kulasegaran had previously said that high-ranking staff of the HRDF misappropriated about RM100mil, around a third of the fund’s RM300mil coffers.

He also said certain management staff members were overpaid with high salaries and bonuses and there was collusion between managerial staff and external parties to award contracts.

When contacted about the Bangsar South acquisition, former HRDF CEO Datuk C.M. Vignaesvaran Jeyandran said the board of directors had given approval before any property was bought.

On the claims that the property purchased was not the one which the board had approved originally, he clarified that it was part of a better building by the same developer and was adjacent to the first building.

“Everything was done according to the appropriate procedures, that’s for sure. There’s no such thing as buying before getting board approval.

“It went through our legal adviser, the investment committee and the audit committee. When we bought the six floors in the other building from the same developer, we also went back to the board and rectified it,” he said.

Asked on the purpose of the acquisition, Vignaesvaran said when he stepped down on June 21 last year, it was still an ongoing discussion at the board level whether the property was to be used as HRDF’s office or for investment purposes.

Bukit Aman Commercial Crimes Investigation Department acting director Deputy Comm Datuk Saiful Azly Kamaruddin said the department received two reports on this matter.

“We have since referred the case to the Malaysian Anti-Corruption Commission as it is under their purview,” he said.

At the time of the Bangsar South property purchase, the HRDF chairman was Datuk Dr Abdul Razak Abdul, who also chaired the investment panel.

Datuk Seri Richard Riot was the then human resources minister.

By royce tan The Star

Panel set up for HRDF clean-up

Datuk Noor Farida Mohd Ariffin

The Human Resources Development Fund is to undergo a complete overhaul. A committee has been set up to ensure the fund is rid of weaknesses and misuse of power among senior staff members as well as a promise by its new chairman to personally deal with allegations of graft.

The HRDF will also have the Malaysian Anti-Corruption Commission seconding one of its officers to the organisation.

Its chairman Datuk Noor Farida Mohd Ariffin said this was so that the MACC could establish the proper rules and regulations in the HRDF governance’s clean-up.

“HRDF has sought and received the support of the MACC in implementing rules, regulations and procedures to prevent any further misuse or abuse of employers’ money.

“MACC has agreed to second one of its officers to HRDF to beef up the unit and to expedite this process,” she said in a statement to The Star yesterday.

Last month, the HRDF set up an ad hoc Compliance and Governance Unit to implement the recommendations made by the Governance Oversight Committee (GOC) for the HRDF and to assist in investigations by various law enforcement agencies, said Noor Farida.

This came about after Human Resources Minister M. Kulasegaran formed the five-member GOC in June 2018 to review and investigate allegations that RM100mil had been misappropriated under the previous HRDF’s administration.

Key findings and recommendations by the GOC were finalised and published publicly on the HRDF website, said Noor Farida, who was appointed as its chairman on Jan 1 by Prime Minister Tun Dr Mahathir Mohamad.

Top on the list of GOC recommendations was to stop the segregation of 30% of employers’ human resources development levy towards the Consolidated (Pool) Fund, which was set aside for special projects.

“This was made effective from Nov 1, 2018. No funds have since been allocated or spent on special projects,” she said.

Noor Farida noted that the move was not received well by certain quarters, including training providers, training institutions and trainers, who claimed that their incomes were affected.

The human capital development agency faced heavy public scrutiny following reports of alleged wrongdoings that had taken place under the previous administration.

In November last year, Kulasegaran revealed that high-ranking staff members of HRDF misappropriated about RM100mil out of the RM300mil that was in the fund.

He also highlighted several wrongdoings such as abuse of power, criminal breach of trust and arriving at decisions without reporting to the board of directors.

The Star, in an exclusive report on Jan 9, also highlighted the purchase of a RM154mil property in Bangsar South, also conducted without the approval of the directors and investment panel.

The new HRDF management lodged two police reports. The police have since referred the cases to the MACC.

Meanwhile, it was reported by an online portal that police would be questioning former HRDF chief executive officer Datuk C.M. Vignaesvaran Jeyandran over the “missing” RM100mil.

“On behalf of the HRDF board of directors, I want to reiterate that the board is fully supportive of the actions being taken against the wrongdoers by the HRDF,” said Noor Farida.

She said she would look into these allegations personally and urged those with any complaints or allegations to email her directly at anoorfarida@hrdf.com.my by Jan 31 so that she could initiate an independent investigation.

“If any further information is forthcoming from time to time, it will certainly be investigated,” she added.

The findings would also be published over the HRDF website, said Noor Farida.

By clarissa chung and fatimah zainal The Star

Related:

Report: HRDF possibly mishandled multi-million buy by swapping ...

Kula: 30% contribution by employers to HRDF to stop from Nov 15

HRDF chief Vignaesvaran resigns amidst allegations - Nation

Ex-CEO: No comment on HRDF scandal - Nation

Malaysia's Human Resource Development Fund (HRDF) a 'personal piggy bank of sr managers!

Clean up the graft and power abuse at Human Resource Training & Development provider HRDF

https://youtu.be/fuk3xC6M0ow https://youtu.be/JrJ0V3TIskc https://youtu.be/CT8dgpCh_2w

Scandal-hit: The clean-up at HRDF appears to be far from over.

Questions over HRDF Bangsar South property

Panel set up for HRDF clean-up

Datuk Noor Farida Mohd Ariffin

Report: HRDF possibly mishandled multi-million buy by swapping ...

Kula: 30% contribution by employers to HRDF to stop from Nov 15

HRDF chief Vignaesvaran resigns amidst allegations - Nation

Ex-CEO: No comment on HRDF scandal - Nation

Malaysia's Human Resource Development Fund (HRDF) a 'personal piggy bank of sr managers!

Thursday, January 17, 2019

Huawei’s founder Ren Zhengfei breaks years of silence amid continued US attacks on Chinese tech giant

Ren Zhengfei, founder and chief executive officer of Huawei Technologies Co., speaks during an interview at the company's headquarters in Shenzhen, China, on Tuesday, Jan. 15, 2019. Ren, the billionaire telecom mogul, broke a years-long silence as his technology empire faces its biggest crisis over three decades of existence. Photographer: Qilai Shen/Bloomberg https://youtu.be/YNkfddyDEkk https://youtu.be/TUqg4yrs-Po

Ren Zhengfei, the billionaire founder of Huawei Technologies, broke years of silence on Tuesday as his business empire faces its biggest crisis in more than three decades amid continued pressure from the US that its networking gear may pose a security threat.

The telecoms mogul called Donald Trump “a great president” and said he would take a wait-and-see approach to whether the US leader will intervene in the case of his eldest daughter and Huawei finance chief Meng Wanzhou.

Meng is in Canada facing extradition to the US, where authorities have accused her of fraudulently representing Huawei to evade US sanctions on Iran. She has denied any wrongdoing and said that she will contest the allegations if surrendered to the US.

The emergence of the reclusive Ren, who last spoke with foreign media in 2015, underscores the depth of the attacks on Huawei, the largest symbol of China’s growing technological might.

“I love my country, I support the Communist Party. But I will not do anything to harm the world,” the 74-year-old Ren told a select round table briefing, only his third formal chat with foreign reporters. “I don’t see a close connection between my personal political beliefs and the businesses of Huawei.”

The US has banned government use of Huawei’s technology products and services because of security concerns. US security experts have warned of a range of potential security risks, including but not limited to the capacity to control telecommunications infrastructure and even conduct undetected espionage. It has pressed its allies to follow suit.

Japan has excluded Huawei from public procurement and Australia and New Zealand have effectively blocked Huawei from the roll-out of their 5G network infrastructure. The UK and Canada are also weighing the possible security risks posed by Huawei — along with a growing list of other European countries.

Huawei has consistently denied any connections with the military, saying that it is a private company part-owned by its employees and that governments need to ensure there is an objective basis for choosing technology vendors.

“Ren Zhengfei doesn’t give many interviews, but his decision to speak publicly seems like a smart move,” said Brock Silvers, Shanghai-based managing director of Kaiyuan Capital. “The threat to Huawei’s European business is real and it is understandably responding to it. Ren’s public comments today show how seriously he views the situation.”

Developing markets like Huawei gear as it is cheap, reliable

Ren, who joined the Communist Party after leaving the People’s Liberation Army, stressed the potential for cooperation with the US. He played down Huawei’s role in current trade tensions between Washington and Beijing, which have rattled investors and corporations worldwide.

“Huawei is only a sesame seed in the trade conflict between China and the US,” Ren said from the company’s newest campus in the industrial city of Dongguan.

“Trump is a great president. He dares to massively cut tax, which will benefit the business. But you have to treat well the companies and countries so that they will be willing to invest in the US and the government will be able to collect enough tax.”

Meanwhile, China's Foreign Ministry on Tuesday urged Canada to release Meng immediately, saying the case was an abuse of legal procedure. Ministry spokeswoman Hua Chunying made the comment at a daily news briefing in Beijing.

Meng was released on bail five weeks ago and is living under restrictions in her multimillion-dollar Vancouver home while awaiting extradition proceedings.

The arrest in Poland last week of a sales executive accused of spying may have helped prompt Ren to personally marshal Huawei’s global response. The employee in Poland was subsequently fired by Huawei, which said the individual had brought the company into disrepute.

Why Huawei and its CFO Meng Wanzhou are caught up in the US-China trade war

Ren expressed hope that Huawei could find a way forward with the US.

“Huawei is not a public company, we don’t need a beautiful earnings report,” Ren said. “If they don’t want Huawei to be in some markets, we can scale down a bit. As long as we can survive and feed our employees, there’s a future for us.”

Ren is a legendary figure in China’s business world and moves in the highest government circles. The self-made billionaire is the son of schoolteachers and grew up in a mountainous town in China’s poorest province, Guizhou.

Huawei founder and CEO Ren Zhengfei survived a famine, but can he weather President Trump?

A survivor of China's great famine between 1958 and 1961, Ren graduated from the Chongqing Institute of Civil Engineering and Architecture. He worked in the civil engineering industry until 1974 when he joined the PLA as an engineer – a connection that still provokes questions in the West about Huawei’s ties to the Chinese army and government.

Source: Bloomberg Iris Deng

This article appeared in the South China Morning Post print edition as: Huawei founder breaks silence amid US attacks

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Saturday, January 19, 2019

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Friday, January 18, 2019

Questions over HRDF Bangsar South property

Panel set up for HRDF clean-up

HRDF chief Vignaesvaran resigns amidst allegations - Nation

Ex-CEO: No comment on HRDF scandal - Nation

Related post:

Questions over HRDF Bangsar South property

Panel set up for HRDF clean-up

HRDF chief Vignaesvaran resigns amidst allegations - Nation

Ex-CEO: No comment on HRDF scandal - Nation

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Thursday, January 17, 2019

Rightways: Sowing the seeds of Success!