Thursday, July 19, 2012

The Musa Aman Connection: HSBC’s Money-Laundering Scandal


The Musa Aman Connection: HSBC’s Money-Laundering Scandal

Written by  Sarawak Report

Thursday, 19 July 2012 10:56

As HSBC’s Global Head of Compliance resigned in disgrace yesterday, acknowledging the bank had turned a blind eye to a staggering $38 trillian dollars’ of suspect transactions, thoughts in Sabah will have returned to the financial affairs of their Chief Minister, Musa Aman.
The Malaysian Anti-Corruption Commission (MACC) report into timber kickbacks (a case described by Najib Razak as being “linked to Musa Aman”) contains a great deal of information about HSBC’s involvement in processing the millions of dollars that ended up in Musa’s bank accounts.
Likewise, Sarawak Report has exposed detailed information about a series of HSBC accounts linked to Musa, which were eventually closed in 2006.
So, no surprise that the US Senate’s Committee on Homeland Security has reported that in the period 2006-2010 the HSBC facilitated international money-laundering on a gigantic scale for drug gangs, terrorists and rogue nations, shunting the suspicious funds between offshore branches, the United States, Switzerland and elsewhere.
Sarawak Report’s own extensive dossier on Musa Aman makes clear that the proceeds of Malaysian timber corruption should be added to this shameful list!
Timber corruption
What international banks have helped Musa and his cronies to achieve
The victims of this multi-billion dollar racket include the indigenous people of Sabah, who have been deprived of their native lands and hunting grounds; the taxpayers of Sabah, from whom vast revenues have been stolen and honest businesses, which have been exploited by this criminal corruption.
Meanwhile, the consequences of this crime have included the wanton destruction of one of the most precious remaining environments on our planet – which till recently comprised the world’s oldest and most bio-diverse area of remaining rainforest.
Countless species of plants and animals have been wiped out in an orgy of preventable greed over just the last decade alone.
In the past days Musa has once again unwisely attempted to deny all the evidence that has piled up against him.  Likewise the Speaker of the Sabah Assembly refused to allow a motion of no confidence to be put to the vote – a desperate measure that plainly undermined the democratic process.
There have even been attempts to suggest that Musa has now acknowledged the millions that were passed into his Swiss bank accounts, but that he told the MACC that he was merely holding them as a nominee for his political party UMNO and his boss the PM Najib Razak!
Even if this unlikely scenario was true, do Musa’s defenders really believe this would somehow make him innocent of the criminal looting of his country’s wealth?  Because if Najib and Musa were in this together then they are both equally guilty!
The role played by banks like HSBC and UBS in the looting of Borneo’s resources
Over the last decade, as the dwindling forests of Sabah have started to run out entirely, Musa Aman has continued to licence formerly protected areas and steep hillsides to be stripped bare of timber by his cronies.
His greed has completed the destruction of Sabah in the same way that Taib’s obsessive greed has felled the once magnificent jungles of Sarawak.
Two Chief Ministers, Taib and Musa - both wallowing in the wealth stolen of their people
And as we have demonstrated in close detail over the past weeks, Musa’s cronies have in return paid him tens of millions of dollars in kickbacks via his known nominees, including his “middleman”, Michael Chia.
It is thanks to the blind eye turned by Singapore and Hong Kong branches of two global banks, HSBC and UBS that Musa Aman and Chia have then been able to launder this money and funnel it, as we have demonstrated, through a series of off-shore accounts into Musa’s own Zurich bank account.
Chia - the dandy who turned out to be cack-handed at money-laundering
On numerous counts the manner in which first HSBC and then UBS have handled the millions of US, Singapore and Australian dollars sloshing around in Chia’s accounts, breached the rules of compliance that banks are supposed to abide by to prevent money-laundering.
Both banks should be thoroughly investigated on this matter and held to account, and prosecutors in Switzerland and the environment NGO Bruno Manser Fund have this week taken further action to ensure that just such an investigation will take place.
This week Bruno Manser Fund issued letters of complaint to the two major regulatory bodies of Singapore, the Monetary Authority and the Financial Investigation Division to alert them to the behaviour of UBS bank and HSBC in their conduct of the Musa Aman-linked accounts in Singapore.
These complaints cannot be ignored in the light of the fact that The Swiss Federal Attorney General’s Office has also in the past few days announced that it has now formally opened its investigations with relation to UBS, following the receipt of Sarawak Report’s dossier of evidence.
That case will have been further informed by the extensive information provided to the Swiss by the Hong Kong authorities, who originally arrested Michael Chia in possession of $16million dollars back in 2008.
Even, Malaysia’s own authorities have also been forced to at last acknowledge what other countries have long been investigating. Each day that now passes raises further questions as to why the Attorney General (Musa’s relative by marriage) has failed to act on the dossier on Musa that Prime Minister Najib Razak has confirmed in on his desk.
Compliance
Nowhere to hide - is Musa Aman's best excuse now that he was merely a 'nominee' for UMNO?!
Because, even if Malaysia does nothing in this case, the truth will surely come out as these beleaguered banks come under international pressure  to own up to their part in this affair.
Key to Musa’s ability to siphon nearly a hundred million dollars of stolen money out of Sabah has been the willingness of banks like HSBC to turn a blind eye and to break basic rules on compliance (the very fault that will now result in multi-million dollar fines for that bank in other parts of the world).
These rules demand that accounts linked to politically exposed persons and accounts that take receipt of large lump sums of money should be fully scrutinised and accounted for.
The accounts run by Michael Chia, a known associate of Musa, who then passed on these sums to Musa Aman himself and provided income for Musa’s two sons, were clearly top targets for such scrutiny on both counts.
However, both HSBC and UBS failed to do so, preferring to continue to handle transactions on millions of dollars of kickback income.
In 2006 HSBC did finally close down Michael Chia’s accounts, but in a manner that raises even more questions over compliance. A series of cashier orders amounting to some $20 million were handed over to Chia in order to clean out his accounts.
Hard to trace - by issuing huge cashier orders HSBC was helping Chia break the chain of transactions and thus conceal the source of his millions of dollars
Chia used these cash orders to open his new accounts at UBS in Singapore, thus providing him with a complete break in the chain of transactions, whereby millions in kickback money had travelled from the accounts of Sabah based logging companies into Musa Aman’s Zurich bank accounts!
Equally questionable was UBS Singapore’s own willingness to accept these cash orders to open Chia’s new accounts. This completed the laundering of Sabah’s dirty timber money.
There are no secrets left in these transactions. Our dossiers are already with the authorities.
So since this is the time for confessions and apologies, HSBC and UBS should spare further time and public money and come clean on their dealings with Musa Aman as well as all the other misdeeds revealed by the US Senate Committee.
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 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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Nailed! Musa’s Lies Are Countered By Swiss UBS Bank In Court Evidence!

Posted Sunday, June 10th, 2012
This post is also available in: Iban, Malay

End of Sabah's Vampire Bat?
Sabah Chief Minister, Musa Aman, branded Sarawak Report maliciously motivated liars and implied we were master forgers, after we revealed financial documents showing that his nominee, Michael Chia, had laundered nearly a hundred million US dollars of timber kickbacks on his behalf.
However, we now challenge him to name the Swiss bank UBS AG liars as well, because their submissions to a current court case in Singapore confirm our evidence!
In a sworn statement UBS AG declares that money was indeed paid to Musa Aman’s own sons from a series of accounts that had received huge sums from logging concerns.
The bank names the very accounts and payments that we referred to in our original reports, proving that the documents in our possession are not forgeries.  Rather they are genuine bank statements.

'Adopted son' - party boy Michael Chia is the son of Musa's long-term business crony Chia Niet Foh, who has received barging monopolies worth tens of millions of ringgit.
Michael Chia was the front man
Chia Tien Foh (Michael Chia) gives sworn testimony in the  same Singapore court case, which also confirms our reports that he was Musa’s front man for this entire money-laundering operation.
Chia, who was arrested trying to smuggle SG$16million out of Hong Kong in 2008, alleges before the court that he was the real controller of these accounts, even though they were held in the name of a so-called nominee.
This claim confirms his direct financial links to Musa Aman – links that the Chief Minister has been desperately attempting to deny:
I wish to put it on record once again that I have no business association whatsoever with an individual named Michael Chia”[Musa Aman statement 12/11/12]
As we have detailed in previous exposes, an investigation by Hong Kong’s Independent Commission Against

Two front men for Musa - Michael Chia and the Sabah lawyer Richard Christopher Barnes
Corruption (ICAC) has already concluded that the money from this web of UBS AG bank accounts was eventually channelled via Musa Aman’s lawyer, Richard Christopher Barnes, into a master account in Zurich, held in the name of Musa Aman himself.
According to the ICAC’s own chart (below) the operation contains the hallmarks of a classic money-laundering exercise.
The millions of dollars were passing through layers of ownership, designed to conceal the real beneficiary of the kickbacks paid for logging concessions handed out by Yayasan Sabah.
We can confirm that beneficiary was Musa Aman, the man who makes the ultimate decision over who gets those concessions, in his capacity as Chairman of Yayasan’s Board of Trustees.

As investigated by the ICAC - the web of accounts run by UBS AG went through 'layers' of ownership - finally arriving at Musa Aman's Zurich account
When conspirators fall out …
The Singapore case, which should prove the undoing of Musa and also cause huge problems and embarrassment for UBS Bank, has been launched by a former associate of Chia.
The timber trader, who was the registered owner of a number of these suspect accounts, complains that he was illegitimately ignored when UBS followed instructions to empty two of them and transfer the money directly into another account in the name of Michael Chia’s wife.

In open court - the evidence that shows up Musa is available to the public
The trader is demanding compensation from UBS AG and from Chia’s wife Yap Loo Mien, who received all the proceeds from the Hong Kong accounts of two British Virgin Island (BVI) companies, Blisstop Corporation and Zenique Investments Ltd, which were emptied after Chia’s arrest by the Hong Kong police.
Some $USD2 million were in the bank accounts at the time and statements in our possession show that some $USD15 million had been channelled through them in the course of two years.
Much of that money had already been transferred directly into the accounts of a BVI company controlled directly by Michael Chia himself, called CTF International Ltd (standing for Chia Tien Foh) and to another BVI company called Angel Face Consultancy, which is known to belong to another known key nominee of Musa Aman.
An Example: A half million dollar payment comes in from Innoprise’s Papua New Guinea contractor, Gleaming Group and then goes out to Michael Chia’s CTF International

The money went from the Chia company ICT International to lawyer Richard Christopher Barnes who held it in trust for Musa Aman, before transferring it to Aman's UBS AG Zurich account
According to the chart drawn up by Hong Kong’s ICAC, the money from CTF International Ltd can then be traced flowing into another UBS AG account (A/C 231117) run by the lawyer Christopher Barnes.
This account was specifically held in trust for Musa Aman and the money from it was being transferred directly into Musa’s Zurich account N/A21010109!
Piggy-bank for Musa’s boys!
However, in the meantime, bank statements show that Musa’s two sons (who were studying in Australia) were able to draw on the Zenique Investments Ltd account for their own needs.
We have already demonstrated in earlier reports that they were drawing on other accounts run by Chia and his associates as part of the same money-laundering operation.

Transfer to Musa's son from one of the disputed accounts. Numerous payments were made to Musa's sons from Chia's network of accounts
Payments to Mohd Daud Tampokong came out of same accounts!
Damningly, another fat payment was also debited from the Zenique Investments Ltd account in favour of a key Yayasan employee, who has been identified as interface between the Board of Trustees and timber traders, Mohd Daud Tampokong.
Tampokong, who has been cited in a separate prosecution as the man who informed timber traders that permissions for Yayasan licences must be negotiated through “middleman” Michael Chia, received US$85,000!
USD$85,000 for trusty Yayasan employee Mohd Daud Tampokong! Something that needs to be explained.
Sabah timber tycoon, Agus Hassan, sparked the prosecution after he denounced Michael Chia for using his position as “middle man” at Yayasan Sabah to blackmail extra kickbacks for himself on top of the sweeteners that have to be paid to Musa Aman himself to get logging licences.
A letter from Hassan, the owner of the logging company Peluamas, now forms part of the prosecution case.  It makes clear that Tampokong had told Hassan that he needed to negotiate with Chia as the “middleman” for Yayasan.  Could this be how he earned the $85,000USD?
Tampokong told timber tycoon that he had to negotiate with Yayasan through “middleman” Michael Chia. Was that why he was paid $85,000USD?
That case continues, however this latest court action against UBS AG and Mrs Chia in Singapore takes the evidence still further in implicating Musa Aman directly.  In the course of fighting with each other, the former conspirators and UBS AG bank have released evidence that lets the cat out the bag about what was really going on.
“Deposit for logging concession”
For example, a number of the transfers that were made into the Zenique account give the game away quite clearly. The credits are labelled by the payee, who is a major Sabah timber tycoon, as “Deposit for logging concession”!
There were several transfers like this – why was money sent as a “Deposit for logging concession” by a Sabah tycoon to a company whose account has now been emptied into the bank account of Michael Chia’s wife?
As the Chairman of Yayasan Sabah, the body that issues logging concessions in the state, Musa Aman is going to have to publicly explain, immediately, how it was that millions of dollars for “logging concessions” were being paid to a shady BVI company, operated by two Sabah timber merchants, including Michael Chia who was known to be extremely close to him.
Likewise, he must explain why this network of Chia-controlled accounts were paying out money to Musa’s sons and their Guardian, Imbarine bin Bujang.
The payments to Musa’s sons
It is UBS’s testimony regarding these payments to Musa’s sons that give Musa the hardest questions to answer.
The bank has been trying (unwisely) to defend its actions in clearing out the two BVI company accounts. They did so, they claim, merely on the evidence of a telephone call and then a scribbled note, supposedly made by the formal beneficiary of the accounts.
Scruffy note – UBS AG have submitted this as evidence they were authorised to remove USD$2million from the accounts
However that trader denies he made the call or wrote the note. Normally authorisations for such payments would always backed up by a signed fax and by a formal recorded telephone call.
Nevertheless, to back its case, the bank has produced evidence as part of its sworn statements, claiming that a number of other payments were made from this network of accounts  in a similar way. The bank cites transfers to Musa Aman’s sons as examples of such payments!
UBS AG’s own statements in its defence cites previous payments to Musa’s sons and Guardian, Imbarine bin Bujang, from linked accounts as the reason why they accepted an oral instruction
This admission backs the numerous bank statements in our possession, which also demonstrate that several payments were made from accounts controlled by Chia to Musa’s sons, who were studying in Australia and it proves that our documents are not forgeries (see our previous coverage under Sabah Scandal)
The UBS AG bank confirmation of these payments nails the lie that Musa had nothing to do with the bank accounts being managed by Chia.  In fact his sons were using them as a regular piggy bank to pay for their expenses!
It leaves only one inevitable conclusion, which is that the ultimate beneficiary of these BVI companies and all the other accounts linked to Michael Chia, was Musa Aman himself.
After all, it is Musa Aman, the Chief Minister of Sabah and Chairman of Yayasan, who possesses the power to grant logging concessions in the state.  It is Musa Aman who possesses the power to name Michael Chia as the “middleman”.  So, why would anyone pay a “deposit for logging concession” to anyone else?
UBS AG also cites these other payments, confirming our earlier reports of payments to Chia himself and CTF International from the account network
Chia testimony shows how nominees were operating
The Chia family have a long association with the Chief Minister, despite Musa Aman’s recent statements denying any business connections. Chia’s father has received lucrative barging monopolies under Musa’s management and the son has received logging concessions.  Michael Chia has let it be widely known that Musa refers to him as his ‘adopted son’.
However, the testimony of Michael Chia and his wife makes the situation all the worse for Musa in this case.
While UBS AG bank are still hanging on to the defence that they made the transfers into Yap Loo Mien’s accounts, because they were under the impression they had received a verbal instruction from the named account holder, Chia together with his wife are telling a conflicting story.
These accounts were really controlled by me, claims Chia!
In their own sworn statements to the court Chia and his wife claim that they were the rightful beneficial owner of these companies and accounts all along and that the named account holder was merely a nominee!
The registered owner of the accounts was just my nominee – was UBS AG in on the deciet?
Chia’ss assertion is that UBS emptied the accounts on his instructions, because the bank knew that he was the real man in charge and that the registered owner was just a front!  His wife in her testimony backs up this version of events, along with another business partner. Sabah timber trader Chong Siak Nyen, further undermining UBS AG’s case before the court.
My husband was the real owner
Were UBS complicit ?
Such claims by Chia and his wife and partner Chong Siak Nyen (recipient of timber concessions from Yayasan Sabah) leave the finger pointing dangerously at the major Swiss bank UBS AG.
The bank is claiming that it moved the money from the accounts only because it believed it had verbal instructions to do so from the official, registered owner of the accounts.
We were instructed not by Chia, but by the registered account holder
However, Chia says the instruction came from him, as the secret owner of the account.

UBS is Switzerland's biggest bank - is its reputation suffering from its association with Musa Aman?
If UBS AG knew Chia was the real owner of the account, then they were sanctioning a highly irregular arrangement for an individual known to have close links to a politically exposed person, Musa Aman.  Not only that, regular payments were being made from these accounts to Musa Aman’s sons by the bank’s own admission.
Under Swiss law banks should be extremely wary of running high value accounts linked to politically exposed persons, who have no visible legitimate means for getting the money. But, instead of investigating their role in possible money-laundering, the bank appears to have chosen to defend its role and to deny possible wrong doing in this case.
This, despite the fact that the ICAC investigation, backed up by documents in our possession, shows that Musa Aman was receiving unaccountable millions into his UBS AG Zurich bank account, through a network of UBS AG managed accounts and companies set up by UBS AG, that benefitted from payments for “logging concessions” worth millions of dollars.
What UBS knew

Yap Loo Mien (Mrs Michael Chia) - USD$2million better off!
The evidence submitted to the Singapore court case clearly indicates that the UBS ‘wealth management advisor’, Denis Chua, who handled all these accounts linked to Chia, Barnes and Musa knew exactly what was going on.
Documents and emails placed before the court confirm our evidence that it was Chua who did all the administrative work in setting up the two BVI companies, Zenique and Blisstop and then opened their Hong Kong bank accounts.
UBS AG staff member Denis Chua was also involved in every ‘layer’ of the money-laundering network and he clearly understood the key role played by Michael Chia as Musa’s pivotal nominee.
Indeed papers show that Michael Chia was personally present at the meeting with Chua to set up the two Hong Kong bank accounts for Zenique and Blisstop in somebody else’s name.  Chua also managed the account for CTF International, owned by Chia, where most of this money flowed.  And he managed teh lawyer Richard Barnes’ account, into which the money flowed from CTF International.
Sarawak Report therefore requests that UBS AG acknowledge whether the letter identified by Hong Kong’s ICAC, which stated that the money in Barnes’ account was “held in trust for Musa Aman” was also drawn up by their own employee, Denis Chua?
The Client”
Chua’s own emails, submitted to the court, also provide devastating evidence supporting Michael Chia’s crooked contentions that he was the secret controller of the accounts.
During a series of email discussions between Chua and UBS AG staff about the closre of the accounts, Chua made this damning satement:
“The client has asked to transfer the money to his wife’s account.  The money will be staying within the bank”
This is clear evidence that Chua, the UBS AG wealth management advisor in charge of the account, regarded Chia as the real ‘client’.  Because it was to Chia’s wife that the money went!
Key email that shows that Chua was taking orders from Chia, not the official account holder
 This crucial email fatally undermines UBS AG’s argument that it was instructed by the named account-holder all along.  It is now that named account-holder who is suing UBS AG for accepting an instruction from a 3rd party and suing Yap Loo Mien for taking the cash!
Case to answer UBS and Musa Aman
How is UBS AG to explain such evidence and how is Musa Aman going to explain the evidence produced by UBS confirming our own earlier evidence that his children were receiving money from bank accounts managed by his ‘adopted son’, Michael Chia?
Musa will also have to explain why “deposits for logging concessions” were being paid into these very accounts from which his sons were receiving regular payments.
Attorney General caught up in the cover-up

Time the Attorney General did his job? - Abdul Gani Patail has refused to prosecute despite mounds of evidence
And it is not only Musa who must speak out step down.  The Attorney General, Abdul Gani Patail, must now act and bring charges against Musa Aman, or step aside as well.
He cannot legitimately ignore such compelling evidence of Musa’s involvement in timber kickback accounts, verified by Switzerland’s largest bank.
Abdul Gani Patail has already been heavily criticised for refusing to act on this case.  The MACC took full statements from Chia, Barnes and many others, when they originally investigated the case after Chia’s arrest in Hong Kong. They worked closely with the Hong Kong authorities and their investigations are believed to have resulted in a recommendation that no less than 40 criminal charges should be pressed against the Chief Minister. So far Patail has refused to allow the case to be prosecuted.
The fact that Musa is his family relative and that both Musa and his brother, Anifah Aman, the Foreign Minister, are key BN players, makes it all the more vital that the Attorney General shows himself not to be biased in their favour.
Only the most corrupted and criminal regime could continue to attempt to ignore the weight of evidence now, sitting so squarely in the public arena. Unless of course, UBS bank is to be added to the growing list of ‘liars’, who are pointing the finger at Sabah’s Chief Minister, the man who has been responsible for a shocking acceleration of deforestation in the State since snatching office in 2003.
End of Sabah’s Vampire Bat? – Cartoonist Zunar’s take on our expose!




















 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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Barging Into Profit – The Chia Family Sue Yayasan Sabah For RM84.4million In Monopoly Row!

Posted Thursday, April 19th, 2012
This post is also available in: Malay

Clearing out the Borneo Jungle - more profit for Musa Aman?
A court case, lodged in the High Court of Sabah in Sandakan in February, raises further questions over the business relationship between the Chief Minister, Musa Aman, and the family of Michael Chia, as well as the lawyer Richard Christopher Barnes.
Aman has denied that Michael Chia was his favoured ‘adopted son’ or that he has had any business relations with him.
Yet the court case now reveals that Chia’s father, a barging contractor named Chia Nyet Min, was granted a monopoly over the transportation of logs for Yayasan Sabah during the time that Musa Aman was its Chief Executive in 1997.
Chia’s companies, Kini Abadi Sdn Bhd and Imej Berlian Sdn Bhd, have enjoyed that monopoly ever since, but Chia is now suing for damages of RM84.4 million, because it says Yayasan broke the terms of the monopoly agreement by allowing another contractor to take over some areas of work since 2005.

Mysterious? - The Chia family, owners of Kini Abadi Sdn Bhd and Imej Berlian Sdn Bhd, are now suing Sabah Berjaya Sdn Bhd, a subsidiary of Yayasan Sabah, headed by their old friend the Chief Minister Musa Aman!
So, have the Chia family and Musa Aman now fallen out, or is this matter a little more complicated and devious?
Damages of RM84.4 million!
The fact that the damages for an infringement of this barging contract are being set at the enormous sum of RM84.4 million, gives a clear picture of the extreme value of the monopoly that Musa Aman’s Yayasan Subsidiary, Sabah Berjaya Sdn Bhd, awarded to Chia’s company.
It begs the question why did Musa Aman decide, as Chief Executive of Yayasan in 1997, to avoid open market competition for barging contractors and hand a state-backed monopoly to just one family?
Is it a coincidence that this company, Kini Abadi Sdn Bhd, just happens to be owned by the father of Michael Chia, the man the Chief Minister has now gone on public record to disown?

Shareholder - Michael Chia's father Chia Nyet Min
After all, until his arrest for suspected money laundering in 2008, Michael Chia used to publicly call himself the ‘adopted son’ of Musa Aman and presented himself as the go-between for the Chief Minister and timber tycoons seeking concessions from Yayasan.

Chia Nyet Min - father of Michael Chia and the winner of an exclusive contract to hold the monopoly over the barging of logs from Yayasan Sabah's timber concessions.
Documents presented in previous court cases testify to this fact, including letters written by the timber dealer Agus Hassan of Peluamas Sdn Bhd, describing Michael Chia as the go-between in negotiations for getting timber contracts [see previous coverage].
Denials
Now, however, the Chief Minister is denying the association with Chia.  This is despite the fact that we have presented bank statements showing that Michael Chia was sending standing payments to Musa Aman’s sons in Australia to fund their education expenses!
The denial also ignores the fact that both Michael Chia and his father have been given numerous timber concessions by Musa, through Yayasan Sabah.
And it flies in the face of the new information that we are now able to make public, which is that Musa had also even granted the Chia family the monopoly over the barging of all the logs transported for Yayasan in the Sandakan region of Sabah!

From our leaked MACC document - the Chia family's dealings with Yayasan Sabah - no business contacts?
How can Musa deny that he has had a business relationship with Michael Chia and his father Chia Nyet Min when there are so many documented ties between this family and Yayasan Sabah, which he has so long been in charge of?
Background to a relationship – Musa and Chia family
Aman’s fortunes in life began to rise after he achieved the position of Party Treasurer for the West Malaysia-backed UMNO party in Sabah in 1992.  This was just before the party achieved its political take-over of the State.
UMNO lost the election in 1993, but then staged its coup by bribing enough ‘frog’ assemblymen from the winning party, in order to get the majority in the State Assembly and to wrest control from the lawful winners of the election.  They have kept tight control of Sabah ever since.
Soon after the UMNO take over, Musa Aman was parachuted in as Chief Executive of Yayasan Sabah.  After all Yayasan Sabah is the trustee of the state’s rich timber resources.  His was clearly a politically motivated appointment to ensure the party had control over this valuable sector.
Aman kept this position until he moved on to win a State Assembly seat himself and then to take over as Chief Minister – at which point he also returned as Chairman of the Board of Trustees for Yayasan Sabah!

Back in charge at Yayasan - Musa Aman combines control of Sabah's richest resource with his role as Chief Minister!
Despite his job at Yayasan of supposedly protecting Sabah’s forest reserves for its people and for future generations, Musa appears, instead, to have started cutting the whole lot down as fast as he could, while diverting millions into his own bank accounts (see our previous coverage).
And by further creating a barging monopoly for Chia’s Kini Abadi Sdn Bhd and Imej Berlian Sdn Bhd, Musa Aman also made sure that no one else could benefit from the transportation business and squeezed out local people from potential employment and profit.  Instead all the profit went to Chia’s company.
Timber traders and competitors were soon complaining that the monopoly meant bad service, higher prices and the loss of jobs for local people.  So why would Musa Aman insist on supporting it?
Another kickback opportunity?
Perhaps the Chief Minister would care to deny our inside information that the Chias were paying him RM5 in cash per m3 of logs transported under this monopoly?
After all this would make a real incentive for his awarding of the monopoly, which is otherwise hard to explain.

The latest agreement giving rights to Kini Abadi

Exclusive rights to transport wood
The contract between Kini Abadi and Yayasan’s subsidiary Sabah Berjaya Sdn Bhd, was renewed a number of times.
However, after a protracted row with timber traders, in particular the tycoon Andrew Lim, who complained to Yayasan bitterly over claims of bad service, Yayasan Sabah allowed some other contractors to come in.
This was the basis for the court case by Chia, since he claimed his agreed monopoly was being transgressed.
Chia’s deposition before the court (of which we have a copy) shows just how much the contract was worth. In his complaint he describes his company as having been appointed as the “exclusive agent” for barging wood extracted by Yayasan Sabah and then details how much timber was involved (below)
Extract from the court deposition by Kini Abadi Sdn Bhd - it shows the huge volume of timber to be transported, growing year on year!
The rates the Chias were allowed to charge for this transportation were laid out in the 2006 agreement, of which we also have a copy (below).

Lucrative - millions of m3 of wood to be charged these rates for transportation - how much was the kickback?
When Andrew Lim’s companies were allowed to start to use alternative barging contractors Chia claimed that the losses to his company amounted to the sum he is now demanding in damages RM84.4million.  He lays out his calculated losses in his deposition to the court (below).

RM84.494,948million to be precise! Chia calculates his losses from the partial loss of his monopoly that he has enjoyed for years, thanks to the good offices of Musa Aman!
Business partners fallen out, or just a new way to make money out of Yayasan’s resources?

Transporting Sabah's logs
On the surface, it would appear that the once cosy relationship between Chia and Musa (which Musa now denies) has gone sour.  The businessman is suing the organisation which Musa heads and which had for years offered Chia such a very valuable monopoly.
On the other hand, insiders have pointed out that the Chia family would “never go against Musa”, from whom they have made millions and from whom they hold numerous valuable timber monopolies.
So, is this just another way to extract money from Yayasan Sabah?  After all this is only money from poor taxpayers, not from Musa himself.  The Chia’s, if they win the case, will walk off with RM84.4million of public money – no problem for Musa!
Barnes connection

Richard Christopher Barnes just happens to be the lawyer often used by Yayasan Sabah when it comes to such things as taking advice on the barging monopoly!
It is also surely noteworthy that the legal advisor to Yayasan Sabah on this matter of the monopoly has been none other than a firm called Shelley Yap.
The Chief lawyer at Shelly Yap is Richard Christopher Barnes, another individual from whom the Chief Minister is now trying to distance himself.
It was Barnes, who was arrested by the authorities along with Michael Chia over the alleged laundering of millions of US dollars worth of timber kickbacks from Sabah.
As we have demonstrated in earlier reports, Hong Kong investigators have shown that Barnes was receiving money from HSBC and UBS accounts managed by Michael Chia and then forwarding it into an account in the name of Musa Aman in Zurich.
The Chief Minister has been actively denying his links to these two men ever since.  Yet how can he deny the fact that he has worked with both of them closely over many years through his dealings with them at Yayasan Sabah?
It is a matter of record!

The Chief lawyer at Shelley Yap, who advises Yayasan Sabah on its monopoly? - Richard Christopher Barnes!
Barnes’ opinion on the subject of granting separate transportation licences to other companies was given to Yayasan Sabah in 2010.  He stated that this would be a breach of the monopoly handed to Kini Abadi and that legally they would be entitled to sue.
This is exactly the outcome that Yayasan now faces with the RM84.4million ringgit suit now tabled against them in the Court in Sandakan!


























 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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HSBC used by 'drug kingpins', says US Senate

Senator Carl Levin: "HSBC's chief compliance officer knew what was going on"

Related Stories

HSBC provided a conduit for "drug kingpins and rogue nations", according to a US Senate committee investigating money laundering claims at the bank.
Its report said suspicious funds from countries including Mexico, Iran and Syria had passed through the bank.
The president and chief executive of HSBC Bank USA, Irene Dorner, apologised to the committee for the behaviour which she said deeply regretted.
Earlier, HSBC's head of compliance, David Bagley, resigned at the hearing.
Ms Dorner apologised "for the fact that HSBC did not live up to the expectations of our regulators, our customers, our employees, and the general public".

“Start Quote

Some of the things I found frankly took my breath away”
Paul Thurston HSBC executive
She said she had worked hard to change the culture at the bank.
The bank also said it was in the process of closing 20,000 accounts in the Cayman Islands as a result of the investigation.
The US Department of Justice said it is conducting a criminal investigation into HSBC's operations.
Dangerous environment Senator Carl Levin said HSBC's lack of controls at its US and overseas units had been "a recipe for trouble".
Mr Levin is chairman of the Senate Permanent Subcommittee on Investigations, which looked into HSBC's activities.
Mr Levin said an audit had found that: "From 2001 to 2007, HSBC affiliates sent almost 25,000 transactions involving Iran worth over $19bn dollars through HBUS and other US accounts, while concealing any link with Iran in 85% of the transactions."
HSBC senior executives in London knew what was going on, he said, but allowed the "deceptive conduct" to continue. Key HBUS officials were also informed early on, he said.

US government rules prohibit financial transactions with Iran and certain other countries, the committee said the bank's actions in getting round these had in some cases assisted terrorism.
According to the Senate committee, HSBC accepted more than $15bn in cash from subsidiaries in Mexico, Russia and other countries at high risk of money laundering but failed to conduct any monitoring of these bulk cash transactions between mid-2006 and mid-2009.
The report also found that HSBC knew of lax anti-money laundering practices at its Mexican subsidiary HBMX, which had dated back to its purchase in 2002.
HBMX was warned, on at least two occasions, by Mexican authorities that drug money was probably being laundered through HBMX accounts.
The hearing comes at a time when the standing of banks is already at rock bottom, says BBC New York business correspondent, Michelle Fleury.
She says: "The scandal over the manipulation of the Libor inter-bank lending rate hasn't exactly inspired confidence and has also been under scrutiny in Congress on the same day. The idea though that one of the world's biggest banks would be facilitating violent crime threatens to cast an even darker shadow over banks and bankers."
'Painful and embarrassing' One HSBC executive, Paul Thurston, who was head of retail banking and wealth management, said the bank had taken wrongdoing seriously, and had taken action on many occasions, including dismissing staff.
"Now is the appropriate time for someone new to head group compliance"
He told the hearing of the difficulties of working in Mexico, which, he said, was a dangerous environment where kidnapping of bank staff was widespread and employees came under pressure from criminals who would attempt to corrupt them.
Mr Thurston referred to substandard record-keeping and the difficulty of knowing who the bank's clients were. He said: "Some of the things I found frankly took my breath away."
Before the hearing began, HSBC said in a statement, that it expected to be held accountable for what went wrong.
"We will apologise, acknowledge these mistakes, answer for our actions and give our absolute commitment to fixing what went wrong," HSBC said.
Senator Levin spoke of a "polluted" system that allowed black-market funds to move through the US banking system.
"In an age of international terrorism, drug violence in our streets and on our borders, and organised crime, stopping illicit money flows that support those atrocities is a national security imperative," said Mr Levin.
The report also concludes that the US bank regulator, the Office of the Comptroller of the Currency, failed to properly monitor HSBC.
Many of HSBC's breaches of US anti-money laundering relate to its use of bearer share accounts. Under the rules for these accounts, ownership of shares and the income they incur can be passed from person to person in secrecy.
HSBC's US subsidiary HBUS had opened more than 2,550 accounts for bearer share corporations.
These businesses are commonly set up in tax havens such as the British Virgin Islands.



































Barclays




Barclays scandal sends shockwaves through global finance

Sunday, July 8, 2012           Barclays
  • clays
British and US regulators fined Barclays US$452 million just over a week ago for attempted manipulation of interbank interest rates between 2005 and 2009.
LONDON: The Barclays rate-rigging scandal is sending shockwaves through world finance, putting ethics and regulation under scrutiny, and raising the prospect of criminal charges in a sector-wide global probe.

Britain's Serious Fraud Office said Friday it will investigate the interbank rate manipulation scandal which has engulfed Barclays, forced three top resignations, tainted the City of London and sparked a political firestorm.

Barclays was fined £290 million by British and US regulators just over one week ago, for attempted manipulation of Libor and Euribor interbank interest rates between 2005 and 2009.

Barclays became the first bank to be fined as part of a global probe into suspected manipulation of the twin interest rates that are crucial to the operation of short-term financing and global markets.

British lawmakers voted on Thursday to hold a parliamentary investigation into the scandal, instead of a full judicial inquiry.

"This is a multi-bank issue -- albeit evidence and fines for other culpable banks will probably dribble out over a period of many months or years," said Ian Gordon, banking sector analyst at Investec.

"In broad terms, the issue itself and the associated fallout are damaging for the financial sector, both in reputational terms, the costs of investigation and fines -- and any potential redress.

"Moreover, the issue helps to distract from and hence damage any initiatives to increase the flow of lending to the economy, with obvious negative consequences," Gordon said.

BNP Paribas analysts agreed that the crisis had the potential to engulf other lenders.

"As far as we are aware, the regulators have so far not disclosed a full list of banks being investigated," they said in a research note to clients.

They added that "additional fines ... cannot be ruled out, although it's impossible to assess the exact exposures".

Libor (London Interbank Offered Rate) is a flagship instrument used all over the world, affecting what banks, businesses and individuals pay to borrow money. Euribor is the eurozone equivalent.

The Libor rate is calculated daily by data provider Thomson Reuters, on behalf of industry body the British Bankers' Association, using estimates from banks of their own interbank rates.

Euribor is provided by the Brussels-based European Banking Federation, using data from 43 international banks.

Barclays has admitted that its traders had routinely submitted false readings, as they attempted to benefit their own lucrative derivatives deals.

The lender also posted lower Libor values from 2008 to prevent speculation that it would require a government bailout such as rival groups Lloyds and the Royal Bank of Scotland.

"Barclays attempted to manipulate and made false reports concerning two global benchmark interest rates, Libor and Euribor, on numerous occasions and sometimes on a daily basis over a four-year period, commencing as early as 2005," the Commodity Futures Trading Commission (CFTC) said on June 27.

The US watchdog added that employees at Barclays and its investment bank arm Barclays Capital had sought to boost trading positions to increase profits or minimise losses.

"In addition, the attempts to manipulate included Barclays' traders asking other banks to assist in manipulating Euribor, as well as Barclays aiding attempts by other banks to manipulate US Dollar Libor and Euribor."

Dan Wilsher, senior law lecturer at the City Law School, City University London, told AFP that the scandal raised serious questions over the conduct of some financial sector workers.

"The Libor scandal reveals a lack of honesty amongst dozens of employees -- not just at Barclays -- when the financial rewards are so big for cheating the system, the chances of getting caught slim and the pressure from management is very great," Wilsher said.

"The government will try to make it a crime to give wrong Libor figures but that will be a small step.

"We have not had a broad enquiry into the 'culture' of banking. At the moment the Leveson inquiry is looking at the ethics of the press following numerous scandals. People say we need the same for banking."

The government-appointed Independent Commission on Banking ruled last year that British banks should separate their retail and investment arms to avoid a repeat of the global financial crisis, blamed in part on highly speculative trading practices.

The ICB also recommended that banks substantially increase their capital buffers.

"We have just completed a big ICB review, whose findings the government largely accepted and will pass laws to implement," Wilsher noted.

"This was a technical report on how to protect taxpayers and avoid another crash like that of 2008. It did not address the wider culture in detail but there are many different actions on this front.

"The EU restrictions on bonus payments are an important step in this direction. These need to be adopted globally. The US has introduced bans on trading activities by banks.

"Most importantly, banks need to hold much more capital and become much more risk averse. Hedge funds should take the risks and bear the consequences, not taxpayers."




Barclays

















 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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HSBC Exposed: Drug Money Banking, Terror Dealings - By RT (19/7/12)
RT   
Thursday, 19 July 2012 11:45
International banking giant HSBC may have financed terrorist groups and funneled Mexican drug money into the US economy through its lax policies, a damning Senate report reveals. The bank’s bosses have apologized for the misconduct.

David Bagley, HSBC’s Head of Group Compliance, admitted during a Senate subcommittee hearing that the company had made a number of lapses, adding that he planned to resign.

“I recognize that there have been some significant areas of failure,” Bagley told the US Senate Permanent Subcommittee on Investigation. “I have said before and I will say again: despite the best efforts and intentions of many dedicated professionals, HSBC has fallen short of our own expectations and the expectations of our regulators.”

Irene Dorner, CEO and President of the bank's American operation (HBUS), told the panel that HSBC deeply regrets the lapses in oversight, apologizing for the company's mistakes.

Senator Carl Levin, the chairman of the subcommittee, gave details of one such intricate scheme to launder cash between 2006 and 2009. 

“Because our tough AML (anti-money laundering) laws in the United States have made it hard for drug cartels to find a US bank willing to accept huge unexplained deposits of cash, they now smuggle US dollars across the border into Mexico and look for a Mexican bank, or ‘casa de cambio’ to take the cash.,” Levin noted. “Some of those casas de cambio had accounts at HB Mexico, which, in turn, took all the physical dollars that it got, transported them by armored car or aircraft back across the border to HBUS for deposit in its US Banknotes account, completing the laundering cycle.”

The Senator welcomed HSBC’s apologies, but said it also had to be held accountable. He called on the bank to consider shutting down its Mexican affiliate, as well as other banks suspected of providing funding for terrorists.

Earlier, Levin said “the culture at HSBC was pervasively polluted for a long time.”

The findings are the results of a year-long Senate probe into HSBC’s activities, highlighting systemic negligence throughout the bank’s international structure. The probe was published in a 340-page report in Washington on Tuesday.
­
Financing terror and flouting the rules

HSBC’s activities in Saudi Arabia were brought into question in the report, specifically referencing banking with Al Rajhi Bank. The investigation claims the Saudi bank has links to financing terrorism based on evidence gathered after the September 11 attacks.

Information collated by investigators suggests one of Al Rajhi’s founders was an “early financial benefactor of al-Qaeda.”

HSBC forbade its affiliates from doing business with the Saudi bank in 2005, but this policy was overturned only a few months later when the banks resumed dealings.

In addition, the report cites dealings with two Bangladeshi banks thought to have links with terrorist organizations.

"From an oversight perspective, the failure of accountability here is dramatic," Senator Levin commented.

The probe also details how the bank bypassed US safeguards that protect against transactions potentially involving terrorists, drug lords, and rogue regimes. The investigations committee alludes to almost 25,000 transactions to Iran amounting to over $19 billion conducted through the bank's US office over a period of seven years. The bank did not disclose that the funds were being sent to Iran.
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Narco-banking

The reports cities HSBC’s activities in Mexico, highlighting the fact that the country was treated as a long-risk client despite being a known hub for drug trafficking and money laundering.

It gives reference to the banking conglomerate’s Mexican affiliate transporting a total of $7 billion in hard cash to HBUS from 2007 to 2008. The sheer quantity of capital transferred raised concerns that some of it came from illegal drugs sales in the US.

The report also implicates the Office of the Comptroller of the Currency (OCC), a US financial regulator, for failing to regulate HSBC’s activities.

The OCC reported multiple failings on the part of HSBC in 2010 to implement anti-money laundering measures, namely its failure to monitor $60 trillion in bank transfers and 17,000 account alerts detailing suspicious activity.

The Senate report lays the blame for HSBC’s negligence over the past six years partly at the feet of the OCC for its lack of action in spite of consistent evidence of the banks money laundering issues.

"We have learned a great deal working with the subcommittee on this case history and also working with US regulatory authorities, and recognize that our controls could and should have been stronger and more effective in order to spot and deal with unacceptable behavior,” HSBC said in a statement. The bank also emphasize that they had already taken “concrete steps” to address the issues including drastic changes to “strengthen compliance, risk management and culture."


The new report comes after the UK’s largest bank revealed it would have to pay a $1 billion fine to US authorities for money laundering offenses committed between 2004 and 2010.

‘HSBC report pushes West to rethink alliance with Saudi Arabia’

By RT

A US Senate subcommittee has discovered that British banking giant HSBC gave money to a Saudi bank with suspected links to terrorist organizations such as al-Qaeda. Saudi Arabia has not responded to the findings.













 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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Anarchy in the Financial Markets

by P. Gunasegaram
THE lawlessness that pervades the international banking industry and especially the large Western banks must raise serious questions as to what perpetuates such barbarous behaviour among the custodians of people’s money.
A big part of it is that the banking industry operates on greed – rewarding its key employees via commissions for businesses brought in, deals made, and products sold even if they were dubious in the first place.
This encourages among the industry a bunch of highly dishonest salesman who shield themselves behind a veil of professionalism to dupe and seduce customers into believing their products are good and their processes are strong, secure and fair.
And they are aided by ineffectual regulators who parrot the trite phrase that free markets should not be overly regulated but turn a blind eye when the biggest financial institutions amass massive positions to fix markets and deceive customers, making a mockery of market freedom.
The integrity of free markets was compromised because big players could affect the direction of markets, making the markets way less than perfect. Free markets basically became unfettered freedom to make money even at the expense of the market and the potential collapse of the world’s financial system.
They did it yet again – or to be more accurate they did it earlier but their misdeeds surfaced once more recently. UK’s Barclays Bank made a US$453million settlement with regulatory authorities in the United Kingdom and the United States for fixing the London interbank offered rate (Libor).
Now, it turns out that Barclays may not be the only one. According to a Reuter’s report, other major banks are likely to be involved and may try and go for a group settlement with regulators, the US’ Commodities Futures Trading Commission and the UK’s Financial Services Authority.
The banks being investigated include top names such as Citigroup, HSBC, Deutsche Bank and JPMorgan Chase. They all declined to comment to Reuters.
And one of these banks, Europe’s biggest – HSBC, has been found laundering billion of dollars for drug cartels, terrorists and so-called pariah states, in a scandal which almost overshadows the Barclays’ one. That leads to the question of whether other banks were involved as well.
If they jointly fixed the Libor, the world’s most used reference rate for borrowings and derivatives with an estimated US$550 trillion, yes trillion, of assets and derivatives tied to the rate, it will be a scandal of epic proportions and may result in settlements of an estimated US$20billion-US$40billion.
That settlement will only scratch the surface. Just 0.1% of US$550 trillion is US$550bil. That implies that if banks had been able to fraudulently fix Libor so that it was just 0.1 percentage points higher, customers throughout the world would have had to pay US$550bil more in interest charges in a year.
In March this year, five US banks, including Bank of America, Citigroup and JP Morgan Chase, made a landmark US$25bil settlement with the US government for foreclosure abuses.
Even so, only a small fraction of affected house buyers are expected to benefit from this. Many other banks, however, are relatively unaffected and have not been fully called to account for their role in the US subprime crisis, which could have caused a collapse of the world’s financial system.
Banks which bundled together risky housing loans into credit derivative products and passed them off as those with higher credit rating than their individual ratings, aided by ratings agencies, got off scot free. No one was called to account.
That the financial system is still vulnerable and that all gaps have still not been closed is JP Morgan’s recent loss of up to US$4bil from rogue trading by a London trader going by the name of The Whale.
There needs to be a new set of rules, regulations and behaviour – one based on ethics, honesty, competency and checks and balances. Custodians of public money should be required to be above all else honest first and foremost.
They should be consummate professionals whose first duty should be to protect the deposits of customers and the bank’s capital. They should not do anything which puts the bank at undue risk.
The insidious habit of rewarding those who bring in revenue with hefty commissions have to be stopped so that bankers do not take risks which put their banks at undue risk which will eventually require trillion of dollars in rescue from governments.
Regulators should again make clear demarcations between those financial institutions who are custodians of public money and those who are not and hold the former to much higher standards of accountability and integrity.
Shareholders of financial institutions who are custodians of public money should be led to expect a lower rate of return on their investments but they should also be led to expect a lower corresponding rate of risk befitting that of major institutions which are so vital for the proper functioning of the economy.
Enforcers should focus on bringing individuals responsible for these losses to book and throwing criminal charges at them which will put them behind bars for long periods of time, befitting their severity. Society at large tends to treat white-collar criminals with kid gloves.
When derivatives trading and deception brought major Wall Street firms such as Enron and WorldCom to their knees and eventual collapse in the early 2000s, enforcers brought to book key executives who are spending time behind bars.
But despite the near collapse of the world’s financial system, despite fraudulent behaviour, despite misrepresentation and deception, despite selling structured products of dubious value and then promptly taking positions against them, despite fixing of reference interest rates, despite money laundering and despite many other crimes still to be unearthed, no one has been brought to account.
Fining institutions leaves those individuals responsible free. In fact, settlements made come with the agreement that there will be no prosecution of individual bank staff and gives major incentive for others to do the same.
They are safe in the belief that the institution will pay the price and they will go free in the event things turn wrong. Otherwise, they will end up millionaires and even billionaires. How convenient an arrangement!
There is anarchy in the financial markets and a state of lawlessness which encourages heists of unimaginable proportions without risk of punishment. If we don’t watch it, the losses will do the world economy and all of us in.

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 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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HSBC scandal erupts as British bank sector faces shake-up

July 22, 2012
Analysts warned that the problems erupting at major British banks could further rock Britain's recession-hit economy.
ANALYSIS
LONDON: A scandal erupting at Europe’s biggest bank HSBC has added to concerns over the state of Britain’s financial sector amid the Barclays rate-rigging affair and as the industry faces a major shake-up.
HSBC last week apologised and its head of compliance David Bagley resigned after US lawmakers accused the London-based bank of failing to apply anti-laundering rules, benefiting Iran, terrorists and drug dealers.
The HSBC affair follows hot on the heels of the Libor interest rate rigging scandal that has brought down top executives at Britain’s Barclays bank — most notably its chief executive Bob Diamond and chairman Marcus Agius.
Regulators are reportedly investigating HSBC, as well as Credit Agricole, Deutsche Bank and Societe Generale, over alleged manipulation of the Libor rate after Barclays was recently fined £290 million over the affair.
Britain’s financial regulator the Financial Services Authority (FSA) has said its Libor probe is looking at seven groups, which are not only British institutions.
Bank of England governor Mervyn King has meanwhile proposed that central bank governors and regulators discuss Libor reform at their upcoming meeting in Basel, Switzerland, on September 9.
Barclays has admitted attempting to manipulate the Libor and Euribor rates between 2005 and 2009.
Libor (London Interbank Offered Rate) is a flagship London instrument used as an interest benchmark throughout the world, while Euribor is the eurozone equivalent.
The rates play a key role in global markets, affecting what banks, businesses and individuals pay to borrow money.
Investec analyst Ian Gordon believes that the Libor affair will have a far greater impact on the global banking landscape than the HSBC affair.
“Libor will, I think, be seen to be a sector-wide issue and with us for many years to come,” Gordon told AFP.
“The only good thing I can say about HSBC/money laundering etc is that it will be seen as a legacy issue, hence the fine — when it comes — will be a one-off rather than the prelude to civil litigation risk.”
Also last week, Britain’s state-rescued Lloyds Banking Group (LBG) agreed to sell 632 branches at a loss to The Co-operative Group after a European Union competition ruling.
LBG, which is 40-percent owned by the British government, was ordered by the EU to offload a sizeable chunk of its branches in exchange for a huge state bailout following the 2008 financial crisis.
The Co-operative Group’s purchase is the latest step in the reshaping of Britain’s banking sector, as the government seeks to separate retail bank activities from investment divisions.
Affecting British economy

The Independent Commission on Banking last year ruled that British lenders should split their operations to avoid a repeat of the global financial crisis, blamed in part on highly speculative trading practices.
At the height of the financial crisis, Britain was forced to nationalise lender Northern Rock and also pump billions of taxpayers’ cash into LBG and Royal Bank of Scotland.
A US Senate report has meanwhile found that HSBC had allowed affiliates in countries such as Mexico, Saudi Arabia and Bangladesh to move billions of dollars in suspect funds into the United States without adequate controls.
Lawmakers said money laundered through HSBC-linked accounts benefited Mexican drug lords and terrorist networks, and skirted US sanctions on Iran.
Analysts warned that the problems erupting at major British banks could further rock Britain’s recession-hit economy.
“The biggest concern following the recent problems is whether declining consumer and market confidence will weigh heavily on what is a crucial sector for UK economic growth,” said Currencies Direct senior analyst Phil McHugh.
“If so, long run UK economic activity will be further subdued with the prospect of additional and continual stimulus from the Bank Of England being required to sustain the economy.
“Equally, the UK’s AAA credit rating will be jeopardised by a shrinking financial sector,” he added.
- AFP













 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

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CORRUPTION : M'sian Foreign Minister named in MACC probe into Sabah Timber

 

 

 

 

 

 

 

 

CORRUPTION WITHIN CORRUPTION - CHAPTER 4 RETRACING BACK THE STEPS

 

 

 

 

 

 

 

 

The Corruption of Mahathir?

 

 

 

 

 

 

 

 

Whistleblower: Muslim scholar on the take?

 

 

 

 

 

 

 

 

Malaysia minister's husband charged with corruption

 

 

 

 

 

 

 

By now, Umno-BN the most corrupt regime in ASEAN with largest stash of illicit outflows

 

 

 

 

 

 

 

 

 HSBC’s Money-Laundering Scandal : The Musa Aman Connection

Please scroll all the way down page to READ article!

 

 

 

 

 

 

 

 

 

Corruption and inflation – how they affect the economy

 

 

 

 

 


Skeletons in Sabah’s closet

FMT Staff | June 23, 2012
Already reeling from a spate of scandals, the revelation that foreign authorities have been scrutinising the bank accounts of some well-connected Malaysians adds a new twist to the power struggle in the country.
KUALA LUMPUR:  The spotlight on large sums of unaccountable money linked to Chief Minister Musa Aman going in and out of bank accounts overseas is threatening to crack open the Barisan Nasional’s “fixed deposit” state of Sabah.
Allegations and investigations of shady timber deals and money laundering may be the proverbial ‘last straw’ to shatter the ruling coalition’s hopes of hanging on to power.
Prime Minister Najib Tun Razak has announced that investigations into the alleged money laundering by Sabah timber tycoon Michael Chia has been completed and handed to the Attorney-General’s Chambers.
“The Malaysian Anti-Corruption Commission has conducted investigations into the Michael Chia case which is linked to the Sabah chief minister.
“It has been completed and presented to the AGC for study and a decision,” Najib said in a written reply in parliament this week, adding that the anti-graft body received full co-operation from its Hong Kong counterparts, the Independent Commission Against Corruption (ICAC), which triggered the investigation in 2008.
But Sabahans are not holding their breath on whether action will be taken by AG Abdul Gani Patail.
When Swiss global financial services giant, UBS Ag confirmed that large sums of money were channeled into the bank accounts of family members of Musa and his cronies, Sabah Umno members and their BN coalition colleagues began to squirm.
Already reeling from a spate of other scandals, a stagnating economy as well as being under fire for cracking down harshly on rallies demanding free and fair elections, the revelation that foreign authorities have been scrutinising the bank accounts of some well-connected Malaysians adds a new twist to the power struggle taking shape in the country.
Scandal not new
The ‘funny money’ allegedly comes from kickbacks from the illegal flow of timber out of Sabah.
That, not all of the state’s enormous wealth is accounted for has long been suspected.
That some of it is being siphoned out to line certain pockets has enraged many especially after a World Bank report showed that the state remains the poorest in the country.
The money-laundering scandal is not new. It has simmered since late 2008 after Chia, was arrested in Hong Kong as he was about to board a flight with a bagful of cash said to total SG$16 million.
Chia was immediately linked to Musa but the Chief Minister denied knowing the man, denied any wrongdoing and, it appeared after a period of silence, the trail of shady deals and international money-laundering at the highest levels was buried.
That is until about two months ago.
It resurfaced with a vengeance with the release of new documents by online news portal Sarawak Report again fingering Musa and again forcing him to deny any involvement in the controversy.
He branded the reports a fabrication and implied the supporting documents and receipts uploaded by the news portal were forgeries.
The news portal earlier this month revealed documents which were tendered by UBS Ag in submissions during a current court case in Singapore relating to the series of deals.
These documents, it said, supported their earlier report of questionable timber deals originating out of Sabah.
No prosecutions so far
The documents included a sworn statement by the bank that money was indeed paid to Musa’s sons from a series of accounts that had received huge sums from logging concerns for “logging concessions”.
Named were accounts and payments that were leaked in Sarawak Report’s earlier exposé which the portal said proved its documents were not forgeries but “genuine bank statements” which needed to be clarified by Musa as they were compelling enough for further investigation by Malaysian authorities.
Gani has already been heavily criticised for refusing to act on the case.
MACC took full statements from Chia, Sabah lawyer Richard Christopher Barnes and many others, when they originally investigated the case after Chia’s arrest in Hong Kong.
The commission worked closely with the Hong Kong authorities and their investigations are believed to have resulted in a recommendation that no less than 40 criminal charges be pressed against Musa.
However, no prosecutions have been made thus far by Malaysian authorities.
The fact that Gani is related to the Aman family and that both Musa and his brother, Anifah, the Foreign Minister, are high-profile figures in government, troubles many within the Umno who fear unanswered accusations against them may damage the party.
Musa made a show this week of being confident that Sabah will remain a BN stronghold.
He said the people were aware that development in Sabah could only be attributed to the BN government.
“Godwilling, Sabah will continue to be a BN stronghold in the upcoming election. The Sabah people are more mature in evaluating the BN government’s track record,” he told reporters  after the last of his meet-the-community-leaders session involving Tuaran, Kota Belud and Ranau districts.
In the last general election in 2008, Sabah BN almost made a clean sweep of the 25 parliamentary seats and 60 state seats, conceding only the Kota Kinabalu parliamentary seat and Sri Tanjung state seat to DAP.
But many are beginning to wonder that with the weight of evidence of possible improper state management now sitting squarely in the public arena a change of government in Sabah may not be so far fetched.

 

 

 

 

 

Corruption and inflation – how they affect the economy

 

 

 

 

 

 

 

 

 

 

 

 

 

 





Saturday, 23 June 2012 10:17

Musa Aman and Swiss bank feel the heat: Cashier orders worth MILLIONS of dollars!

Written by Sarawak Report

The complaint in Switzerland against UBS AG, for banking timber kickbacks on behalf Sabah Chief Minister Musa Aman, has been transferred from the Zurich public prosecutor to the office of the Attorney General.
This raises the matter to a federal level, indicating the potential seriousness of the case.
It has prompted the country’s weekly business magazine ”Handelszeitung” to reveal further details on the scandal, which is starting to prove highly embarrassing for Switzerland’s leading bank and extremely dangerous for Musa Aman.
Cashier orders worth millions of dollars
One of the key matters now raising eyebrows is the revelation that Michael Chia (Chia Tien Foh) used a series of cashier orders worth millions of dollars each to open his various bank accounts with the UBS branch in Singapore back in 2006.
Altogether, he deposited over $20million in mixed Singapore and US dollar cashier orders, all made out on the same day, April 10th 2006.  The orders, some of which were worth over $5 million, were all issued by HSBC in Singapore and then signed for and accepted by UBS AG’s new ‘Wealth Management Advisor’, Denis Chua, who supervised Chia’s new accounts.
Accepted by UBS advisor Denis Chua - made out by HSBC
Experts have expressed astonishment to Handelszeitung writers that a major bank would have accepted these sorts of cash transfers in such a fashion, without questioning their origin.
Jean-Pierre Méan, Chairman of Transparency International Siwtzerland, is quoted as saying:
“To accept cash cheques in such amounts is highly suspicious and calls for an explanation in every case.”
Likewise, the highly renowned former public prosecutor, Paolo Bernasconi,comments:
“If this is true, it’s an incredible story. Within UBS, the same standards should have been applied worldwide. In 2006, this should never have been possible.”
Meanwhile, Monika Roth, the professor of law who is prosecuting the case of behalf of the Bruno Manser Fund, is adamant that in doing so UBS:
“accepted a money-laundering risk, which is unacceptable and sheds a bad light both on HSBC and UBS as members of the Wolfsberg group”.
HSBC also open to serious criticism
SNG 5million 'only' - the size of the cashier orders which Michael Chia used to open his UBS AG bank accounts in 2006
The reference to the bank HSBC opens a new line of enquiry in this matter that threatens to drag another major international bank into the heart of this scandal.
The series of Cashier’s Orders referred to by the Swiss publication were all signed off by the Chief Cashier of HSBC Singapore on 10th April 2006.
We have established that this was the day that Michael Chia closed down a series of accounts at the bank, some held in Singapore dollars and others in Australian and American dollars.
We hold copies of numerous bank statements relating to these accounts up until this date and those statements bear evidence of substantial payments from Sabah timber interests amounting to millions of dollars.  They also show several payments being made from these accounts to Musa Aman’s sons, who were studying in Australia.
In fact, the activity in the HSBC accounts prior to 2006 is very similar to the activity that is then recorded in the UBS accounts opened after 2006.
Both sets of accounts received large sums of money from companies related to logging concerns in Sabah and paid out money to  Musa’s sons and transferred millions into further accounts that eventually led to Musa Aman himself.
The chart drawn up by Hong Kong investigators - layers of accounts leading from Michael Chia and his associates, to the lawyer Richard Barnes and eventually to Musa
Sarawak Report has established that the same Manager, Denis Chua, worked at both banks.  We understand that after Chua left HSBC for UBS AG in 2006, HSBC examined the Michael Chia accounts and subsequently requested that he remove them!
It was at this point we have been told that Chia received the cash orders, which he then brought to Chua, who signed and stamped their acceptance on behalf of UBS.
No comment
HSBC have so far stone-walled questions about their unconventional behaviour in this matter.  The bank merely told Handelszeitung:
“We cannot comment on cases relating to our customers and their accounts”.
However, they also claimed prevention of money-laundering was a key priority and that they have installed “comprehensive world wide risk management processes” for that reason.
This fails to answer why HSBC apparently closed down a suspect account, but nevertheless allowed the account holder to remove the millions of dollars concerned in a series of massive money orders, signed off on the same day for different amounts by their chief cashier.
One financial expert, speaking to Sarawak Report, has commented:
“This very unusual.  Normally, an account would be closed and the funds simply transferred to another regulated or accredited financial institution.  This method could be said to circumnavigate any traceability of these accounts or their closure and you have to ask why?  Issuing these cashier orders is the equivalent to simply giving cash.  Questions could certainly be raised with regards to issues of money-laundering”
Exclusive! - A third bank, Oversea-Chinese Banking Corporation (OCBC), was also caught up in Michael Chia's money-web - this million dollar money order was one of several processed by the bank
UBS are also resorting to minimum comment in response to the growing questions about the conduct of their Singapore branch, managed out of Hong Kong by Denis Chua.
However, while insisting that they operate in all markets in line with the regulatory framework, Switzerland’s largest bank did concede to the magazine Handelszeitung:
“Should it turn out that employees have breached the law, UBS will sanction that and will clear the matter in cooperation with the authorities.”
If UBS do finally concede wrong-doing in their dealings with Michael Chia and his web of financial activities it will be time for them to offer full cooperation with the authorities with regard to what these bank accounts were up to.
Client confidentiality should not be allowed to operate as a crooks charter when it comes to the destruction of Sabah’s Borneo Rainforest.
Time for banks who process illegal timber money to come clean or face the consequence
CLICK HERE TO READ MORE AT SARAWAK REPORT

 

 

 

 

 

 

 

Corruption and inflation – how they affect the economy

 

 

 

 

 

 

 

 






WHAT NOW SABAHANS?

Sabah Chief Minister, Musa Aman, branded Sarawak Report maliciously motivated liars and implied we were master forgers, after we revealed financial documents showing that his nominee, Michael Chia, had laundered nearly a hundred million US dollars of timber kickbacks on his behalf.

“Thou call'st me dog before thou hadst a cause, But since I am a dog, beware my fangs”
William Shakespeare.
As such, SARAWAK REPORT now challenge him to name the Swiss bank UBS AG liars as well, because their submissions to a current court case in Singapore confirm our evidence!



 

 

 

 

 

Corruption and inflation – how they affect the economy

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money-laundering: Musa under pressure

Taufik | August 2, 2012
What portion of the S$38 trillion transacted and transferred across several countries belonged to Sabah?
By Calvin Kabaron
KUALA LUMPUR : As Malaysia faces a looming general election, Sabah Chief Minister Musa Aman, an important ally of embattled Prime Minister Najib Tun Razak, is increasingly being engulfed with questions of integrity and leadership issues.
Musa already lost two Members of Parliament from Sabah last week, and now the ongoing investigations on his own involvement in allegedly money-laundering activities are increasingly affecting his integrity and performance as leader of the poverty-stricken Sabah.
Observers both in Kota Kinabalu and here are of the opinion that the embattled Sabah kingpin would have no avenue to redeem his reputation as more in Sabah are joining the opposition and that incriminating data on the money laundering kept pouring out in websites, blogs and leaflets.
The parallel investigations going on in Singapore, Malaysia, Hong Kong and Switzerland on the money-laundering case have proven to be too much to Musa and the state leadership.
Musa lost his temper during a recent Sabah State Legislative Assembly meeting when there were repeated mentions of “the Hong Kong/Swiss money”. He said he was not afraid of the case and is prepared to tell the “truth”.
“The truth” so far from Musa, as revealed by PKR vice-president Tian Chua recently, was that the money in certain bank accounts was not his but held in trust for Umno.
According to Tian Chua, this piece of information was “leaked” to him by someone who claimed that Musa told the MACC (Malaysian Anti-Corruption Commission) officers earlier this year to “ask Najib and that the money was not his but Umno and Najib’s”.
Tian Chua has since challenged Najib to comment on the information but so far the premier, who is also Umno president, has refused to respond.
Observers claim Najib is cornered and now held to ransom, and could be planning Musa’s exit either ahead or after the general election, which is due anytime now.
Lajim Ukin, one of the two MPs who defected from Umno and pledged allegiance to Opposition Leader Anwar Ibrahim, Najib’s nemesis, had cited dissatisfaction against Musa’s integrity, and Najib for not acting to replace the state party leadership.
Lajim had also implied in his speeches across Sabah that Najib indeed had promised to look into his reports against Musa and the cases that he believed warranted Musa’s replacement ahead of the general election.
Lajim is incidentally allied to another Sabah strong Umno kingpin,Shafei Apdal, an Umno vice- president, who is said to be not in very good relationship with Musa and harbouring the ambition to lead the vast state after the general election.
Allegations of money laundering
Meanwhile, the simultaneous investigations in four countries on Musa’s money, said to be in the hundreds of millions dollars in his accounts with Swiss UBS, one of the world’s three largest banks, had also taken a toll on others.
About 10 days ago, the credible Sarawak Report, an online investigative portal dedicated to Sarawak and Sabah matters, carried a report that the HSBC’s global head of compliance had resigned, acknowledging the bank had turned a blind eye to the staggering S$38 trillion of suspect transactions.
Those in the industry claimed that even the United States Senate committee on Homeland Security is now interested in the case as it involved a very huge amount transacted and transferred across several countries over several years.
“We are already aware of the issues but this staggering figure of S$38 trillion has really hit us hard… whether portions of this money did come from Sabah or Malaysia.
“If true, then indeed only God knows what these Malaysian politicians and their associates had been doing back home and abroad with such money,” said an observer in Kota Kinabalu, adding that it could be the reason why Sabahans remain the poorest in Malaysia despite the fact that the state is the richest in term of resources.
According to the online portal, the Malaysian Anti-Corruption Commission (MACC) investigation report into timber kickbacks contains a great deal of information about HSBC’s alleged involvement in processing the millions of dollars that ended up in Musa’s bank accounts. The HSBC accounts were eventually closed in 2006.
The money-laundering case implicating Musa started soon after the arrest of Sabah businessman Michael Chia in Hong Kong in 2008. He was allegedly carrying S$16 million in cash at the time of arrest.
Chia reportedly told the powerful Hong Kong ICAC (Independent Commission Against Corruption) that the money belonged to Musa.
It was later rumoured that the cash was meant to help Umno in a by-election in Peninsular Malaysia with the knowledge of then premier Abdullah Ahmad Badawi.
Money needed in Sabah
In Europe, the Bruno Manser Foundation has been actively pursuing this matter, together with cases involving neighbouring Sarawak’s Chief Minister Taib Mahmud.
The foundation is pressuring the Switzerland authorities to investigate UBS for being an accessory to an allegedly international money-laundering case, claiming that this money was derived from timber kickbacks and other loots of Borneo’s resources.
Meanwhile, a US-based Borneo rights advocate, Dr Libin Rampasan, said Sabah and Sarawak would continue to be at the losing end as long as a corrupt and greedy leaders are helming the states.
“The ill-gotten money… would have done wonders to improve the livelihood of the natives and provide better basic infrastructures in the two states.
“The people of Sabah must ask the Swiss authorities to disclose all the details. We should be suing and shaming the Swiss authorities for being an and accessory to corruption in the third world where the money is most needed for development,” Rampasan told FMT.

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