Former 1Malaysia Development Berhad's (1MDB) subsidiary, SRC International Sdn Bhd denies allegations that it misappropriated a RM4 billion loan from Retirement Fund Incorporated (KWAP). – The Malaysian Insider filepic, October 21, 2015. Former 1Malaysia Development Berhad's (1MDB) subsidiary, SRC International Sdn Bhd today denied allegations that it has misappropriated a RM4 billion loan from Retirement Fund Incorporated (KWAP).
In its first statement to the media, the Finance Ministry-owned firm said it strongly rejected the allegations, which resulted in negative financial and reputational repercussions for its business, and the government in an attempt to politically undermine it.
"We call on those quarters who are engaged in efforts to overthrow the government to desist from involving SRC in their political campaign and to avoid making false and unsubstantiated allegations against us," SRC said.
The statement was in response to reports carried by news portal MalaysiaKini and whistleblower site Sarawak Report that had published an alleged charge sheet against Prime Minister Datuk Seri Najib Razak and a diagram of alleged fund flows into his accounts – claiming that a RM4 billion loan obtained by SRC International from KWAP had been misappropriated.
SRC said it conducted an internal investigation and believed that the claims were based on fabricated documents, representing a deliberate attempt to mislead the public.
The company said the RM4 billion loan from the government pension fund was accounted for on its balance sheet in accordance with standard accounting and governance practices, and stressed that none of it was misappropriated "as claimed by those with malicious intent".
"In the interests of full disclosure, we ask the good office of the Attorney-General to conduct a full investigation into these claims and the alleged charge sheet published by Sarawak Report and fund flow diagram published by Malaysiakini.
"We ask that the parties responsible for these fabrications be identified, given that their authenticity was denied by the Malaysian Anti-Corruption Commission on August 3, 2015," SRC said.
It also explained its corporate social responsibility (CSR) activities, saying that any expenditure by the company on social programmes was derived from cash income generated from its investments.
"Over the years, this has amounted to approximately RM500 million excluding other non-cash items, providing us with strong income to use for such purposes," it added.
This is not the first time questions were raised about the RM4 billion loan.
On October 16 last year, DAP lawmaker Tony Pua also questioned what had happened to the RM4 billion secured Islamic loan from KWAP, and which was guaranteed by the federal government.
The loan was disbursed in two tranches in August 2011 and March 2012. – October 21, 2015.
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