HOW is it possible for billions of ringgit to disappear from a sovereign wealth fund with no alarm raised until much later? If witness testimonies in former prime minister Datuk Seri Najib Razak's 1Malaysia Development Bhd (1MDB) trial last month are anything to go by, it happens quite easily.
Obviously, nothing excuses the primary act of theft; but, how many opportunities to stop it went untaken because the people in place were unwilling or unable to intervene?
Consider the damning testimony of a former member of the 1MDB board of advisers, who at the time of his appointment was the top civil servant in the country. By his own admission, all he did was to do nothing except collect his RM30,000 allowance every month.
He never attended any meetings or discussions, and never asked why there were no meetings. The appointment, in his opinion, was as compensation for his "low" top civil servant salary. The first he knew of the scandal, he says, was from reading about it in the mass media and Internet.
If this had been a roadsweeper unaccustomed to government protocols, the cavalier attitude to such a heavy responsibility would have been understandable. But that it had come from the top civil servant — the one person in the whole of the government, even more than the politicians, who was definitely supposed to know the proper way of doing things — shows how easily safeguards can crumble when the guards aren't clear or don't care about what they are supposed to keep safe.
Even more shocking was that this top civil servant claimed that he understood 1MDB to have been set up as a political fund for the then ruling party. Knowing that this was funded by the government's money (by means of government guarantees), how could he have squared that with his professional and personal conscience? Or is this such a common practice that no one in government bats an eyelid any more?
Another witness, who was the then second finance minister, testified that when he expressed reservations about the investment choices of 1MDB and that standard operating procedures were not being followed, he was told off by the first finance minister (who was also the prime minister). He was thus reduced to just following orders; the key phrase repeated by the witness was "Saya Yang Menurut Perintah" (Your Obedient Servant).
Regardless of who ends up being held responsible for the disappearance of the funds, the fact is, they are gone; and because the government acted as guarantor, it is the nation that has to keep paying off the debts as they are called in, amounting to what could well be tens of billions of US dollars, that may need at least two generations to pay off.
But, we are already experiencing the repercussions of what happens when gatekeepers enable alleged crooks. One example is the newly removed government subsidy for bottled palm cooking oil, which costs RM20 million per month.
The US$4.5 billion (nearly RM20 billion) in 1MDB funds squirrelled out of the country could have paid for 1,000 months, or more than 80 years of cooking oil subsidies.
Think of how many other subsidies or real development projects could have been covered by properly managed government funds. Actions have consequences; inaction also has consequences.