Sidek: RCI on forex losses could shed more light

(Bernama) – A Royal Commission of Inquiry (RCI) could help reveal more details on the foreign exchange losses suffered by Bank Negara Malaysia (BNM) in the 1980s and 1990s, said Tan Sri Mohd Sidek Hassan.

The chairman of the Special Task Force (STF) to probe the forex losses said that its investigation found that the figure is greater than what was disclosed.

However, the STF was unable to scrutinise any further due to limitations that it faces, he said in an interview with selected media on Friday.

“As a task force, we have limitations. We were established on an administrative basis and not under any legislation. As such, the STF had no powers to coerce anyone to come forward for any discussion or to give any information,” he said.

The STF only had access to documents that were available to the public – for example BNM’s annual reports and consultations between BNM and the International Monetary Fund (IMF).

“We also cannot compel anyone to come forward. Even if you ask them to come and they don’t want to come, there is no issue about it. And even if they came and we questioned them, and they refused to answer we cannot do anything about it.

“And it is not under oath. Even if they answer, we don’t know if that is the truth. So, that is why the RCI is better, although it is safe to say that the STF has reason to believe that the actual loss is different and much more than the figures given earlier,” said Sidek, a former chief secretary to the Government.

On Jan 26, former BNM assistant governor Datuk Abdul Murad Khalid revealed that the BNM suffered US$10bil (RM42.9bil) in foreign exchange market losses in the early 1990s, much higher than the figure of RM9bil disclosed by BNM.

Subsequently, a seven member STF headed by Sidek was formed in February.

Sidek, who is also Petronas chairman, said the STF focused on three points in the terms of reference, one of which was conducting preliminary investigations into losses by BNM related to its speculative foreign currency transactions.

It also investigated whether there was any action to cover up the losses and whether the Cabinet and Parliament were misled in the matter.

On June 21, the STF submitted its findings, concluding that it found a prima facie case to merit in-depth investigations by establishing an RCI.

Sidek said a total of 12 people, including former BNM governor Tan Sri Zeti Akhtar Aziz, was interviewed by the STF, all of whom cooperated well.

He said that most of those called up came forward.

“Those who did not turn up had their reasons, like perhaps they had forgotten,” he said.

Among the others who were summoned by the STF were PKR advisor Datuk Seri Anwar Ibrahim, DAP advisor Lim Kit Siang as well as former Finance Minister II and BNM assistant governor at the time, Tan Sri Nor Mohamed Yakcop.

Asked on the need to investigate something that happened about two decades ago, Sidek said that it had been revealed that the losses were huge.

“I feel that the people need an explanation on the matter, and the government had decided to conduct an investigation. Therefore, an RCI is the only way for a complete understanding.

“If this is not done now, the matter will prolong. In the future, five or 10 years from now, it will crop up again. With a full investigation through an RCI, there could be closure to this,” he said.