Broker in Aussie bank scandal on US terror list

By Frankie D’Cruz and Muzliza Mustafa, The Malay Mail

KUALA LUMPUR: The Kuala Lumpur businessman who implicated Malaysian government officials in a RM11 million kickback probe involving scandal-racked Reserve Bank of Australia (RBA) subsidiary Securency was an alleged blacklisted arms broker.

It was learnt that he had been allegedly blacklisted as a supporter of terrorism by the US government. He was still an agent of RBA’s polymer banknote supplier, Securency, while acting as a broker for a Pakistani weapons operation suspected of playing a key role in that country’s nuclear arms programme.

Speculation about his links with other makers and buyers of a range of laser-guided bombs, unmanned aircraft and air defence software could not be confirmed.

It is not clear whether Securency and another RBA subsidiary, Note Printing Australia (NPA), were aware of his blacklisting by the US authorities in 2005.

However, a warning by the Australian Government’s trade agency, Austrade, about using the arms broker as an agent to secure currency printing contracts from Malaysia was ignored by top executives from both firms.

It was a background check on the Malaysian in July 2007 that prompted the Reserve Bank to audit all foreign agents used by NPA. By late 2007, the Reserve Bank had ordered NPA to sever ties with the Malaysian and its other overseas middlemen due to integrity concerns.

Securency is believed to have continued its association with its network of agents, including the Malaysian, for some time after NPA stopped dealing with him. Securency and NPA engaged him in the late 1990s to lobby Malaysian government and banking officials to adopt the Australian-made polymer banknotes.

The Malaysian was the second arms trader to have been used as an agent by either or both Securency and NPA.

Melbourne’s The Age had revealed Securency’s use of an arms dealer suspected of supplying guns to Latin American drug gangs as its agent in Paraguay.

The newspaper’s investigative reporters Richard Baker and Nick McKenzie filed a series of reports that led to an Australian Federal Police (AFP) taskforce investigation. The probe centres around payments of multi-million-dollar commissions by Securency and NPA to shady foreign middlemen to help win currency printing deals in Africa, Asia and Latin America.

Sources told The Malay Mail that in his attempt to offer himself to the biggest players in the global banknote industry, the Malaysian once tried to join forces with Radius Christanto, the Jakarta middleman at the centre of an Indonesian bribery scandal surrounding the Reserve.

The sources said a similar attempt to team up with the Vietnam middleman Anh Ngoc Luong also failed. Anh was director-general of Hanoi’s Company for Technology and Development (CFTD) which supplies high-tech equipment to Vietnam’s military and security services.

Today, all three have emerged as key players in the most serious corruption scandal ever faced by the RBA. The revelations that Securency wired millions to overseas bank accounts tied to the trio are the most serious development yet in the corruption scandal engulfing the RBA.

The Malaysian Anti-Corruption Commission (MACC) is helping the AFP trace what happened to the more than RM11 million Securency and NPA paid the businessman, as the middleman, after winning a 2004 currency printing contract involving the RM5 polymer note.

He was also the agent when the Australian companies printed the RM50 1998 XVI Commonwealth Games commemorative note in 1998.

He is said to have provided details about alleged kickbacks to Malaysian officials during the MACC interrogation. It was claimed he was paid the money to help the RBA firms win currency supply and printing contracts from Bank Negara due to his powerful political connections.

At least one person closely connected with a senior Malaysian government official is alleged to have received kickbacks from the commissions paid by the RBA firms. The Malaysian’s investment company is alleged to have received hundreds of thousands of dollars in commissions.

Locally, he was chairman of several companies but probably remembered for the problems that besieged the listing of a fast rising company in 1996.

Attempts to get the businessman to discuss his work for Securency and NPA were in vain.

RBA officials, too, refused to answer questions about Securency and NPA’s activities in Malaysia.