KUALA LUMPUR, Oct 25 — The findings in the Pandora Papers are inaccurate and does not take into account the Rotterdam effect and omissions that arise from compiling data on illegal cash flow, Datuk Seri Wan Junaidi Tuanku Jaafar told the Dewan Rakyat today.
The minister in the Prime Minister’s Department in charge of law and Parliament said the two agencies behind the expose — the International Consortium of Investigative Journalists (ICIJ) and the Global Financial Integrity (GFI) — used different methods and did not take into account several important factors.
“GFI’s report is overstated as it did not take into account the Rotterdam effect as well as errors and omissions when compiling data on cash flow and equating it to the flow of illegal funds.
“To connect ICIJ’s report in the Pandora Papers to GFI’s revelations is something that is inaccurate and confusing as both are different organisations with different reporting methods.
“At the moment the Malaysian Anti-Corruption Commission is conducting their investigations and the government will not interfere in this,” Wan Junaidi said.
The Rotterdam effect is a term that describes possible distortions in official statistics as a result of exports that are classified based on the port of exit instead of their final destination.
Wan Junaidi pointed out that ICIJ is a collection of global journalists while GFI is a group of economic analysts, and that both had different methods of reporting financial activity.
The Pandora Papers investigation — involving some 600 journalists from media including The Washington Post, the BBC and The Guardian — is based on the leak of some 11.9 million documents from 14 financial services companies around the world.
Documents obtained showed the rich used tax havens, among them former finance minister Tun Daim Zainuddin.
Also exposed were the companies and trusts held by Daim's children, wife or known business associates jointly were worth at least £25 million (about RM141 million).
Daim’s sons, Muhammed Amir Zainuddin Daim and Muhammed Amin Zainuddin Daim were named owners of a British Virgin Islands (BVI) firm Newton Invest & Finance Limited (BVI) in 2007 when they were nine and 12 respectively.
By 2017, when the brothers were in their early 20s, they were owners of several offshore firms set up in tax havens, including Splendid International Ltd (BVI) which held London properties worth £12 million (about RM65 million at 2017 exchange rates).
In response to Wan Junaidi, Opposition Leader Datuk Seri Anwar said the government’s disinclination to not investigate those named in the Pandora Papers seemed like a delay tactic.
He said the GFI report showed Asia had the highest flow of illegal funds and that Malaysia was the highest in Asia from 30 countries.
“In 2015, US$33.7 billion, more than RM100 million was siphoned but the minister is saying there may be errors or the report is not accurate and so on and so forth.
“Well if so, then conduct an investigation. I want a directive from the prime minister that he will take immediate action and not protect these individuals,” he asserted.
“It’s been almost 10 years. These are big names. If they are innocent and say they were allowed to take RM900 million out of Malaysia because of the lottery then let us know, clarify this.
“How can the government not give a straight answer to MACC, commercial crime unit and others and give them a timeline to report on this?” he asked.
Wan Junaidi said he would do the necessary and would reveal to the Dewan Rakyat their findings in due time.