Forex losses by Bank Negara Malaysia, Facts were concealed; Mahathir, Anwar and Nor Mohamed implicated: RCI


Important report: RCI Secretary Datuk Dr Yusof
Ismail speaking to media after submitting a police report over Bank
Negara forex trade losses in Putrajaya.

THE Royal Commission of Inquiry into the foreign exchange losses suffered by Bank Negara Malaysia (BNM) back in 1990s has recommended that three people be probed over their involvement and liability.

They are former prime minister Tun Dr Mahathir Mohamad, his then finance minister Datuk Seri Anwar Ibrahim and ex-Bank Negara advisor Tan Sri Nor Mohamed Yakcop, whom the report also named as “principally liable for criminal breach of trust”.

The 524-page report also called out Tun Daim Zainuddin, who served as finance minister from July 14, 1984 to March 15, 1991, for having aided and abetted Nor Mohamed by leaving BNM “to its own devices”.

The commission found that the Cabinet in the 1990s was not given the full picture by Anwar on the forex losses, adding that he had “deliberately concealed facts and information and made misleading statements”.

“The Commission is of the opinion that there was deliberate concealment as BNM’s annual reports did not state the actual losses incurred from the forex dealings from 1992 to 1994.

“It is also of the opinion that the then prime minister (Dr Mahathir) had condoned the actions of the finance minister,” it said.

The RM31.5bil losses, it said, were hidden using “unconventional accounting treatments”, such as booking losses to reserves in the balance sheet and the absorption of the remaining losses by the transfer of shares from the Government to BNM as well as the creation of a “Deferred Expenditure” to be repaid in instalments over a decade.

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

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

Anwar, noted the Commission, had been informed about the actual forex losses suffered by BNM.

Dr Mahathir, it said, was informed by Anwar together with then Treasury deputy secretary-general Tan Sri Clifford Francis Herbert in late 1993 that BNM had suffered estimated losses of RM30bil on the forex dealings for 1992 and 1993.

However, in the extract of minutes from three Cabinet meetings on March 30, April 6 and 13 in 1994, Anwar had made “no mention of the actual losses of RM12.3bil for 1992 and RM15.3bil for 1993.”

Anwar had chaired the March 30 meeting as the deputy prime minister. The losses for 1993 were reported as RM5.7bil.

“The prime minister, who chaired the meeting on April 6, did not correct or offer more information when the forex losses for 1993 were recorded as only RM5.7bil,” it pointed out.

“The Commission is of the view that it is the finance minister’s responsibility to inform the Cabinet the significant financial affairs about BNM as the Cabinet has collective responsibility with the finance minister and the prime minister for the country’s affairs.”

Dr Mahathir, it said, claimed to have no knowledge of the real amount of losses, which was untenable with his meticulous nature, as well as that under the law, BNM was the banker and financial agent to the Government with the remainder of its net profit to be paid into the Federal Consolidated Fund.

The report said as pointed out by Herbert, he had expected Dr Mahathir to be outraged but his reaction was quite normal with him uttering “sometimes we make profit, sometimes we make losses”.

“His reaction to and acceptance of the huge forex losses suggest that he could have been aware of the forex dealings and its magnitude,” said the report.

The RCI also found Dr Mahathir’s claim that he could only remember the amount of RM5bil forex losses when informed about it in a meeting with Anwar and Herbert in late 1993 to be “questionable”.

It said this was because based on testimonies of other witnesses and documentary evidence, the RM5.7bil only surfaced when Bank Negara’s 1993 annual report was presented to the Cabinet on March 30, 1994.

“Despite his denials, the Commission is of the opinion that a thorough investigation should be carried out to determine the extent of his involvement and liability,” said the report.

By Martin Carvalho, Hemananthani Sivanandam, Loshana K. Shagar, and Rahmah Ghazali The Star

Police set up taskforce to probe possible criminal offences over Bank Negara’s forex losses

Inspector-General of Police Tan Sri Mohamad Fuzi Harun says police will
open investigation paper following a report that was lodged by Royal
Commission of Inquiry (RCI) secretary Datuk Dr Yusof Ismail. (Image is
for illustration purpose only).

KUALA LUMPUR: Police have set up a taskforce to investigate possible criminal breach of trust and cheating which may have been committed during Bank Negara Malaysia’s foreign exchange losses in 1990s

Inspector-General of Police Tan Sri Mohamad Fuzi Harun said police would open investigation paper as the forex Royal Commission of Inquiry (RCI) had lodged a police report this afternoon.

“A taskforce has been formed and it will lead the investigation. We are investigating the case under Section 409 of the Penal Code for criminal breach of trust,” he told the New Straits Times when contacted.

RCI’s secretary Datuk Dr Yusof Ismail, who is the Finance Ministry Strategic Investment Division director, had lodged a report at Putrajaya police headquarters at 4.10pm asking police to start an official investigation.

In the police report, it was stated that those who were involved in the alleged wrongdoings were Bank Negara Malaysia (BNM) officers, BNM Board of Members, National Audit Department, Finance Ministry and the prime minister who served during the period.

Royal Commission of Inquiry (RCI) secretary Datuk Dr Yusof Ismail seen
leaving the Putrajaya police headquarters after lodging a report. Pic by
AHMAD IRHAM MOHD NOOR

The RCI, in its 528-page report that was tabled in Parliament today, said it believed that Datuk Seri Anwar Ibrahim, who was Finance Minister at the time, had misled the government and concealed the actual losses suffered by BNM.

RCI also said it believed that the prime minister at the time, Tun Dr Mahathir Mohamad, had approved Anwar’s “misleading statements”.

The commission also revealed that the losses were far larger than that what was initially reported by the central bank, RM31.5 billion as against RM5.7 billion, in the period of three years.

Yusof spent almost 40 minutes at the police headquarters and later spoke to reporters who were waiting outside.

He said in the report, the commission had requested the police to start a official investigation on the possible criminal breach of trust, forgery and other wrongdoings which may have been committed during the forex activities.

“Our report is basically requesting the police to start investigation and for the Attorney-General Chambers to take action based on the findings by the police,” he said.

Putrajaya OCPD Asst Comm Rosly Hassan who confirmed that the report was made, said a special unit in Bukit Aman would investigate the case.

By TEOH PEI YING and HASHINI KAVISHTRI KANNAN New Straits Times
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 PROBE NOR MOHAMED, DR Mabatbjr, ANWAR – PressReader

It recommends that they be investigated for possible CBT, fraud

FILE PIC
Former finance minister Tun Daim Zainuddin after giving his statement to the Royal Commission of Inquiry in September.
THE RCI believes Datuk Seri Anwar Ibrahim had concealed Bank Negara’s actual forex losses from the cabinet, and that Tun Dr Mahathir Mohamad condoned his actions. The panel, in confirming that RM31.5 billion was lost, says there are grounds to investigate them for criminal breach of trust and fraud.
THE Royal Commission of Inquiry (RCI) into Bank Negara Malaysia’s (BNM) foreign exchange (forex) losses in the 1990s has recommended investigations against former prime minister Tun Dr Mahathir Mohamad and his one-time deputy, Datuk Seri
Anwar Ibrahim.
The RCI, in its 528-page report that was tabled in the Dewan Rakyat yesterday, said the duo had
concealed facts from the cabinet.
It also recommended that Dr Mahathir and Anwar be investigated for criminal breach of trust and fraud.
“There is a basis for an official police investigation into BNM board of directors, National Audit Department, then finance minister and prime minister for criminal breach of trust and fraud in the performing of the speculative forex transactions and in hiding the losses from the cabinet and Parliament,” the report said.
Former BNM adviser Tan Sri Nor Mohamed Yakcop was also implicated as the commission found that he was responsible for the billions of ringgit in losses.
RCI had recommended that Nor Mohamed be investigated for alleged criminal breach of trust and for allegedly contravening the Central Bank Ordinance 1958.
The commission also found that former finance minister Tun Daim Zainuddin had allegedly abetted Nor Mohamed. Daim was finance minister until 1991 before he was replaced by Anwar.
BNM lost RM31.5 billion in forex trading between 1992 and 1994. Nor Mohamed was
in charge of several portfolios in BNM at the time, including the management of external reserves.

 

BN and Opposition reps at loggerheads over report – Nation

RCI says Dr M helped in concealing RM31.5bil forex losses 

RCI says Dr M helped in concealing RM31.5bil forex losses …

‘Probe Nor Mohamed for possible CBT’ – Nation

Royal commission recommends CBT probe on Nor Mohamed over ..

RCI: Daim abetted Nor Mohamed in committing CBT | Free Malaysia …

Royal commission recommends criminal probe against Anwar …

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Call to shed light on PDC’s huge debts owned to Penang govt


GEORGE TOWN: The state has been told to explain the financial status of Penang Development Corporation (PDC) over its alleged mounting debts.

Datuk Dr Muhamad Farid Saad (BN-Pulau Betong) said PDC received a RM600mil loan last year from Budget 2017, while in Budget 2018 the loan to PDC was approximately RM300mil.

Questioning if the debts indicate that PDC was not on stable financial ground, he asked if PDC would be able to pay back the huge sum to the state.

“Both loans are huge. How is PDC going to pay it all back?

“What has happened to the revenue of PDC in recent years? We would like some answers to the whereabouts of the expenditure on whether the sum was used for investment or loan to a third party.

“Is the PDC today not on stable financial ground until there were some who said that PDC has to take a bank loan to give out salaries,” he said when debating the Supply Bill and Budget 2018 at the state assembly sitting yesterday.

State Opposition Leader Datuk Jahara Hamid (BN-Telok Air Tawar) also raised her concern if PDC “was in the red”, considering that it was among the corporations in the past which had developed Bayan Baru and Seberang Jaya.

“PDC has also contributed to numerous state funds. But now, it is the opposite. PDC is borrowing money from the state government,” she said.

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Penang tables election budget for 2018: higher defict of RM740.5mil, paints rosy economic picture …



GEORGE TOWN: Penang has tabled a higher deficit state Budget of RM740.5million for the next fiscal year of 2018.

Chief Minister Lim Guan Eng when tabling the budget, stressed that it was an estimate and it can be reduced if the state records a higher revenue collection.

Among some of the initial highlights for the state was a free Rapid Penang bus service during peak rush hours in the mornings and evenings.

Allocations would also be given to aid the medical tourism and hi-tech manufacturing sectors.

Penang has tabled a projected budget deficit of RM748.5 million for next year, compared to a RM667 million deficit for this year as administration and living costs continue to escalate.

However, Chief Minister Lim Guan Eng stressed that the state has a unique distinction of tabling projected budget deficits every year yet recording actual surpluses.

Next year’s operating expenditure is RM1.25 billion, while the forecast revenue collection is RM503.7 million.

The cost savings come principally through the open tender system and an efficient administration, Lim told the state legislative assembly today.

After some 10 years of facing various external economic challenges, Lim said the state’s gross domestic product is projected to outstrip the national average growth of 5.2% for this year.

Penang is targeting a GDP growth of 6% this year with the main contribution coming from manufacturing and services, with farming also showing signs of promise through fish farming.

GDP per capita has increased from RM33,597 in 2010 to RM47,322 in 2016, a 30% increase. Penang’s GDP per capita is the second highest in the country, behind only Kuala Lumpur.

From 2015 to the first half of 2017, Penang attracted a total of RM13.8 billion in approved Foreign Direct Investment (FDI).

Tourism has also grown with the number of passengers at the Penang International Airport (PIA) hitting 6.7 million passengers in 2016, exceeding the airport’s capacity of 6.5 million passengers.

The success story in the last 10 years is reflected by annual budget surpluses since 2008, with accumulated budget surpluses over the eight year period between 2008 to 2015 reaching RM578 million.

Lim also announced a range of fresh initiatives, which pundits have described as a people-friendly fiscal plan designed to endear the state government to the voters with the next general election looming near.

> There is a “I Love Penang” card, which is a smartcard for all local residents that allows access to social amenities and benefits provided by the state. The public think tank Penang Institute will be the implementing agency for it, as they have been allocated a budget of RM4.5 million to produce and distribute the smartcards.

> A free public stage bus service was mooted during the daily peak hours in the mornings and evenings – it is aimed at reducing traffic congestion. The project is dependent on the cooperation of RapidPenang.

> Penang has allocated RM60 million to jumpstart a “Pinang Sihat” medical card programme for families whose combined household income is below RM5,000, where the state will subsidise treatment at private clinics.

A medical card will be issued to each recipient, who can only spend up to RM50 per visit to a panel of private clinics who are part of the Pinang Sihat scheme.

“This will help the recipients, who fall ill to see a doctor without worrying too much about expensive charges or travelling to government clinics that are far away from their homes,” said Lim.

> The free mammogram examination scheme for women above 35 years shall continue. So far more than 10,000 women have benefited.

> The state will also be increasing the annual payouts for senior citizens and the disabled from RM100 to RM300 for next year.

> A maximum bonus payout of RM2,000 will be accorded to civil servants who have a good disciplinary record while those below par will only receive RM1,000.

> The state will also allocate RM10 million for hill slope protection efforts, as well as to conceive a study on climate change, and tackle illegal farming.

Later, there was a protest at Komtar, led by former Penang PAS Youth head Mohamed Hafiz Nordin, who urged the state government to rescind the alleged appointment of PKR secretary-general Datuk Saifuddin Nasution Ismail as the new Penang Islamic Religious Council president, replacing Permatang Pasir assemblyman Datuk Salleh Man.

Hafiz argued that Saifuddin was not a religious scholar, therefore he was not suitable for the post. Saifuddin’s replied that holding protests is normal in a democracy.

Source:  Ian McIntyre and Imran Hilmi newsdesk@thesundaily.com

Much ado about nothing

Penang govt also gave an election budget, says MCA leader

“Public housing shortage is serious in Penang. Badminton courts and
swimming pools can be added into low and low medium-cost housing
projects. Tang Heap Seng”

WHAT is wrong with an election budget?

“Election budgets are happy and beneficial things for the rakyat,” said party secretary Tang Heap Seng.

He, however, advised Pakatan Harapan politicians not to “criticise something but did the same themselves”.

“Many Pakatan politicians criticised the Federal Budget and the Penang government did exactly the same.

“They claimed the Federal Budget will help Barisan Nasional win the general election.

“But then, the Penang government also gave an election budget,” said Tang during a press conference at the Penang MCA headquarters in Transfer Road yesterday.

Among the Budget 2018 goodies were Childcare Aid of RM300 for Working Mothers, RM300 aid for each local vocational school students and one-year waiver of business licence for about 29,000 hawkers and traders.

On the state Budget for next year, Tang said while there were many benefits, he was puzzled by the allocation of RM275mil to build 82 badminton courts and four Olympic-sized swimming pools.

“While sports are crucial to a happy society, we wonder why the state paid little attention to Penang’s urgent problems.

“Public housing shortage is serious in Penang. If the government wants to provide badminton courts and swimming pools, these could be added into low and low medium-cost housing projects,” he said.

Penang Gerakan vice-chairman Oh Tong Keong and secretary Hng Chee Wey also issued statements yesterday, expressing bewilderment at the RM275mil allocation.

In contrast, the tabled development expenditure for state Drainage and Irrigation Department is RM12.3mil.

Penang Island City Council and Seberang Prai Municipal Council will spend RM20mil on flood mitigation and for hillslope protection, RM10mil was budgeted.

Tang also said the RM53mil budgeted for the development of Islam was commendable, but wondered why only RM1.1mil would be given to Penang Hindu Endowment Board next year.

He said Chief Minister Lim Guan Eng only mentioned that RM30mil was given to non-Islamic religious development since 2008 when he tabled the Budget.

He said it would be ideal to allocate RM30mil each for the development of Christianity, Hinduism, Taoism, Buddhism, Sikhism and other minor religions yearly.

In a statement as well, Penang Women’s Development Corporation applauded the RM300 yearly aid for each working mother under the age of 60 with children aged six and below through the state Budget.

Meanwhile, Lim clarified that the bonus for civil servants would come from the reserved funds of this year’s Budget.

Earlier, Pulau Betong assemblyman Datuk Dr Muhamad Farid Saad had expressed confusion, saying, “How could you give a bonus this year through a Budget for next year?”

JPMorgan CEO warns he will fire any employee trading Bitcoin for being “stupid.”


 
Tough stand: Dimon has warned that he will fire JPMorgan traders who traded in bitcoin ‘in a second. For two reasons: It’s against our rules, and they’re stupid. And both are dangerous.’ — AFP

NEW YORK: JPMorgan Chase & Co chief executive officer Jamie Dimon said he will fire any employee trading bitcoin for being “stupid.”

The cryptocurrency “won’t end well,” he told an investor conference in New York on Tuesday, predicting it will eventually blow up. “It’s a fraud” and “worse than tulip bulbs.”

If a JPMorgan trader began trading in bitcoin, he said: “I’d fire them in a second. For two reasons: It’s against our rules, and they’re stupid. And both are dangerous.”

Bitcoin has soared in recent months, spurred by greater acceptance of the blockchain technology that underpins the exchange method and optimism that faster transaction times will encourage broader use of the cryptocurrency.

Prices have climbed more than four-fold this year – a run that has drawn debate over whether that’s a bubble.

Bitcoin initially slipped after Dimon’s remarks. It was down as much as 2.7% before recovering.

Last week, it slumped after reports that China plans to ban trading of virtual currencies on domestic exchanges, dealing another blow to the US$150bil cryptocurrency market.

Tulips are a reference to the mania that swept Holland in the 17th century, with speculators driving up prices of virtually worthless tulip bulbs to exorbitant levels.

That didn’t end well.

In bitcoin’s case, Dimon said he’s sceptical authorities will allow a currency to exist without state oversight, especially if something goes wrong.

“Someone’s going to get killed and then the government’s going to come down,” he said.

“You just saw in China, governments like to control their money supply.”

Dimon differentiated between the bitcoin currency and the underlying blockchain technology, which he said can be useful.

Still, he said banks’ application of blockchain “won’t be overnight.”

The bank chief said he wouldn’t short bitcoin because there’s no telling how high it will go before it collapses.

The best argument he’s heard, he said, is that it can be useful to people in places with no other options – so long as the supply of coins doesn’t surge.

“If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in bitcoin than US dollars,” he said.

“So there may be a market for that, but it’d be a limited market.”— Bloomberg

 

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RM40mil siphoned off from the Malaysian Human Resources, Skills Development Fund Corp !



PETALING JAYA: Some RM40mil from the Skills Development Fund Corp is believed to have been siphoned off by those tasked with utilising it for the benefit of the people, sources revealed.

Anti-graft officers detained the cor­­­poration’s 58-year-old chief execu­­tive, who is a Datuk, over the alleged misappropriation of funds.

Others detained included the corporation’s 34-year-old secretary, a 32-year-old assistant financial officer and a 38-year-old director of a company who goes by the honorific “Dr” title.

All of them were picked up in seve­ral places in Kuala Lumpur between 4.30pm and 6pm yesterday.

One of the suspects is said to be an office-bearer with a state Umno division.

Malaysian Anti-Corruption Com­mission deputy chief commissioner (operations) Datuk Azam Baki confirmed the arrests.

Sources said the suspects were said to have collaborated with the company director to siphon the allocation provided by the Government.

The corporation is a statutory body under the Human Resources Mi­nistry. It is responsible for provi­ding financial assistance in the form of loans to individuals, such as school­-­leavers, graduates and others who are interested in pursuing Ma­­laysian Skills Certification, Malaysian Skills Diploma and Malaysian Ad­­van­ced Skills Diploma at public or private skills training institutions.

It is learnt that the misappropriation of funds has been going on since last year.

In 2016, the Government allocated RM35mil to the corporation and another RM40mil this year to carry out training programmes.

“Initial investigations showed RM15mil was believed to have been siphoned off last year. Another RM25mil is believed to have been misappropriated this year,” said a source.

It is learnt that three of the suspects had also collaborated with the company director to allow 15 of his registered companies to manage the training programmes.

But none of his companies was said to have been equipped with the expertise to conduct such training.

Azam said the MACC would be calling up several witnesses “very soon and that more arrests could be expected”.

“We will carry out a thorough probe as it involves public funds. Our officers will also be sei­zing relevant documents related to the case,” he said.

Source: By Simon Khoo The Star

‘Reward them to curb graft’ – It is not wrong to give cash to whistleblowers, says MACC chief

Video:
//players.brightcove.net/4405352761001/default_default/index.html?videoId=5574722710001

KUALA LUMPUR: Rewarding civil servants with cash for exposing corruption is not wrong but it should not be the sole focus, says Tan Sri Dzulkifli Ahmad.

The Malaysian Anti-Corruption Com­mis­sion (MACC) chief commissioner pointed out that offering cash incentives to whistleblowers was just one of the many initiatives in tackling corruption.

“There are many more activities and campaigns done by us which should be taken into account. Is it wrong for us to reward those who refuse to accept a bribe? We are showing our appreciation to those who choose to remain clean, and we look up to these people,” he said after launching the MACC’s anti-corruption posters and painted messages on three Mara Liner buses at Terminal Bersepadu Selatan yesterday.

Civil servants who report cases of corruption are entitled to receive an incentive equal to the amount offered in the bribes, with the lowest sum set at RM500.

However, of the 1.6 million civil servants, only 0.01% have reported cases so far.

In acknowledging this, Dzulkifli said it should not be equated to many civil servants on the take or that they were not serious about eradicating corruption.

“As a matter of fact, we do have a number of them coming directly to provide information but they do not want to lodge an official report.

“Some refuse the bribes offered to them but choose to just tip us off without eyeing a reward,” he said.

On another matter, Dzulkifli opined that “sharks” were now fearful of the MACC due to the “aggressive action” against offenders.

“Clearly, we managed to instil a sense of fear. Many people I meet say they can see fewer giving or taking bribes.

“We see this as a positive sign. We will continue with new arrests, probes and charges every week,” he said.

Later in Putrajaya, Dzulkifli said they would wage a war against illegal gambling den operators and put a stop to their illegal business.

He said the time had come for the issue to be looked into seriously and aggressively, including licensed outlets and cybercafes which al­­lowed online gambling in their premises.

“The issue of gambling dens operating illegally is not new. In fact, even the Deputy Prime Minis­ter has spoken about it. But we don’t see the number of these outlets decreasing.

“I think it is about time we take aggressive action against the operators and those who protect them,” he said after a dialogue with NGO Fight Against Illegal Activities Movement or GBAH.- The Star

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Too good to be true? Think twice


 

HAVE you ever grabbed an offer without any hesitation, simply because the price is too cheap to resist?

Many of us have this experience especially during sales or promotional campaigns. We tend to spend more at the end or buy things which we are uncertain of their quality when the deal seems too good to say no.

It may be harmless if the amount involved is insignificant. However, when we apply the same approach to big ticket items, it can cause vast implications.

Recently, I heard a case which reinforces this belief.

A friend shared that a property project which was selling for RM300,000 a few years ago is now stuck. Although the whole project was sold out, the developer has problem delivering the units on time.

The developer is calling all purchasers to renegotiate the liquidated and ascertained damages (LAD), a compensation for late delivery.

One of the homeowners said he is owed RM50,000 of LAD, which means the project is 1½ years late. When we chatted, we found that he purchased the unit solely due to its cheap pricing without doing much research in the first place.

The incident is a real-life example of paying too low for an item which can leave us as losers, especially when it involves huge sum of investment, such as property.

To many, buying a house maybe a once-in-a-lifetime experience, a decision made can make or break the happiness of a family.

A good decision ensures a roof over the head and a great living environment, while an imprudent move may incur long-term financial woes if the house is left uncompleted.

Nowadays, it is common to see people do research when they plan to buy a phone, household item, or other smaller ticket items.

Looking at the amount involved and implication of buying a house, we should apply the same discretion if not more.

It is always important for house buyers to study the background of a developer and project, consult experienced homeowners regarding the good and bad of a project before committing.

I have seen many people buy a house merely based on price consideration.

In fact, there are more to be deliberated when we commit for a roof over our heads. The location, project type, reputation of a developer, the workmanship, the future maintenance of the property etc, are all important factors for a good decision as they would affect the future value of a project.

Beware when a discount or a rebate sounds too good to be true, it may be just too good to be true and never materialised. If the collection or revenue of a housing project is not sufficient to fund the building cost, the developer may not be able to complete the project or deliver the house as per promised terms. At the end of the day, the “price” paid by homeowners would be far more expensive.

In general, the same principle applies elsewhere. It is a known fact that when we pay a premium for a quality product from a reliable producer, we have a peace of mind that the product could last longer and end up saving us money. Some lucky ones will end up gaining much more.

For instance, when we purchase a car, we should consider its resale value as some cars hold up well, while others collapse after a short period. Other determining factors include the specifications of the car, the after sales service, and the availability of spare parts.

Quality products always come with a higher price tag due to the research, effort, materials and services involved.

In addition to buying a house or big ticket items, other incidents that can tantamount to losing huge sums are like money games, get-rich-quick scheme, or the purchase of stolen cars or houses with caveats.

When an offer or a rebate sounds dodgy, the “good deal” can be a scam.

Years of experience tells me that when what is too good to be true, we should think twice. I always remind myself with a quote from John Ruskin (1819-1900) who was an art critic, an artist, an architect and a philosopher. “It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money – that’s all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do.

“The common law of business balance prohibits paying a little and getting a lot – it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.”

Food for thought by Alan Tong

Datuk Alan Tong has over 50 years of experience in property development. He was the world president of FIABCI International for 2005/2006 and awarded the Property Man of the Year 2010 at FIABCI Malaysia Property Award. He is also the group chairman of Bukit Kiara Properties. For feedback, please email feedback@fiabci-asiapacific.com.

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Malaysia must retool education, skills to adapt to knowledge economy


KUALA LUMPUR: Malaysia needs to reinvent its education system to adapt to the knowledge economy, which has led to a sharp reduction in unskilled jobs and spike in demand for data analysts.

Tan Sri Andrew Sheng, Distinguished Fellow of Asia Global Institute, University of Hong Kong, said Malaysia needs to retool its education and skills, and experiment across the spectrum, in positioning itself in the new economy.

“Formal education is outdated because of the speed of new knowledge. Companies do not spend on ‘on the job’ training, because of cost cuts and staff turnover,” he said during his presentation at the NCCIM Economic Forum 2017 yesterday.

Between 2007 and 2015, the loss of unskilled jobs was 55% relative to other jobs while demand for data analysts over the last five years has increased 372%.

In the global supply chain, old economy companies are quickly losing their edge as digitisation moves faster than physical goods while unskilled jobs will be quickly replaced by robotics due to the fast adoption of artificial intelligence (AI).

“Moving up the global value chain is about moving up knowledge intensity. If you don’t get smarter you won’t get the business.

“We are already plugged into the global value chain. We are very successful in that area but we cannot stay where we are. Remaining still is no longer an option. We need to move from tasks to value added growth to high value added production. In order to do that, we need to learn to learn.”

Sheng said the Malaysian economy is doing well but faces many challenges, including subdued energy prices, growing trade protectionism, geopolitical tensions and is still very reliant on foreign labour.

“Are we ready for the new economy? The way trade is growing is phenomenal but the new economy’s challenges are great and very complicated politically because technology is great for us as it gives us whatever we want but at the cost of our jobs,” he said.

When education fails to keep pace with technology, the result is inequality, populism and major political upheaval.

“What the new economy tells us is that robotics or AI (artificial intelligence) calls for Education 4.0, which means that we have to learn for life,” he said.

Sheng noted that Malaysia has successfully moved quietly into education services, medical tourism, higher quality foods, all through upgrading skills, branding and marketing.

“But formal education has become bureaucratised, whereas we are not spending enough on upgrading our labour force, prefering to hire imported labour,” he said.

Although Malaysia cannot compete in terms of scale and speed, especially against giants such as China, it can compete in terms of scope with strength in diversity, soft skills and adaptability.

“We are winners … but have we got the mindset?” Sheng questioned.

He said Malaysia must upgrade its physical technology through research and development, harness its unique social technology and digitise its business model in order to create wealth.

While the government can help, he added, true success comes from community self-help irrespective of race or creed, and retired baby boomers who have wealth of experience must mentor the youth to start thinking about the new economy.

Eva Yeong, sunbiz@thesundaily.com
Related Links:

 Andrew Sheng – Institute for New Economic Thinking

Andrew Sheng
is a distinguished fellow at Fung Global Institute, chief adviser …
member of Khazanah Nasional Berhad, the sovereign wealth fund of Malaysia.

MALAYSIA should leverage on social technology, which is its true strength, … Tan Sri Andrew Sheng, who is a distinguished fellow at Asia Global Institute, … the new economy as it involves lifelong learning to adapt, innovate and create. … To enhance the skills of the civil service, he pointed out Singapore’s …

Andrew Sheng – Project Syndicate

Andrew Sheng, Distinguished Fellow of the Asia Global Institute at the University of Hong Kong and a member of the UNEP Advisory Council on Sustainable …

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