Panel calls for probe of Mahathir, Anwar and Nor Mohamed over BNM forex losses

A panel formed to look into the foreign exchange losses suffered by Bank Negara Malaysia (BNM) in the 1990s has called for a probe of three former officials to assess their involvement and liability.

They are former prime minister Tun Dr Mahathir Mohamad, ex-Bank Negara advisor Tan Sri Nor Mohamed Yakcop and former finance minister Datuk Seri Anwar Ibrahim.

In a 534-page report, the Royal Commission of Inquiry also named Tun Daim Zainuddin, who was finance minister from July 14, 1984 to March 15, 1991, for having aided and abetted Nor Mohamed by leaving BNM “to its own devices”, reported The Star.

Nor Mohamed was also named as being “principally liable for criminal breach of trust”.

In the report, the commission said that the Cabinet in the 1990s was not given a full picture by Anwar on the forex losses, which amounted to RM31.5 billion ($7.7 billion), and that he had “deliberately concealed facts and information and made misleading statements”.

The losses were said to have been hidden using “unconventional accounting treatments” such as booking losses to reserves in the balance sheet and the absorption of the remaining losses by the transfer of shares from the Government to BNM.

The report said: “All actions to conceal the losses were discussed and approved by the board of directors before the accounts were signed off by the Auditor-General.”

“No further action was taken by the Finance Minister and Treasury secretary-general (as a board member) despite being informed by the Auditor-General on the losses and the unusual accounting treatments.”

Citing analysts, The Malaysian Insight reported that Barison Nasional will be inviting backlash if Dr Mahathir is prosecuted because the “public consensus is that the inquiry into the affair was politically motivated”.

They say that the inquiry was initiated after Dr Mahathir became a fierce critic of Prime Minister Najib Razak, whose administration has been slow to react to the billions lost in the 1Malaysia Development Bhd (1MDB) scandal which erupted two years ago.