Monday 12 September 2011

Germany orders money-laundering probe on Taib

Germany's finance ministry has ordered an investigation into business relations between the family of Sarawak Chief Minister Abdul Taib Mahmud and Deutsche Bank, for any element of money-laundering.

Swiss-based NGO Bruno Manser Fund (BMF), which has been calling for the investigation, said the ministry's order is in response to its complaint.

BMF claimed that the Germany finance ministry had stated in a email reply that it has 'requested the German Federal Financial Supervisory Authority to clarify and check the situation that you outline in your letter to the Federal Chancellor from the money-laundering angle, insofar as this concerns a specific financial institution and, if the Financial Supervisory Authority (BaFin) considers it appropriate, to instigate supervisory measures'.

NONEThe ministry added that the BaFin 'has already made a start on clarifying the situation'.

BaFin is the supervisory authority for financial institutions in respect of money laundering legislation.

BMF welcomed the investigation and is calling on the German federal government to freeze any assets held by Taib (right) in that country.

"In addition, BMF is demanding complete transparency from Deutsche Bank with regard to its dealings with the Taib family and the termination of its business relations with the Malaysian potentate, who has gained a bad reputation worldwide," it said in a statement issued today.

In a letter to German Chancellor Angela Merkel in June, three NGOs - BMF, the Hamburg Rettet den Regenwald (Rainforest-Rescue) Association and the Society for Threatened Peoples - drew the attention of the German government to the Deutsche Bank's close business relations with Taib and demanded that his assets in Germany be blocked.

Links revealed

According to BMF, Deutsche Bank has processed transactions worth several hundred million euros for the Sarawak government since 2004, and is engaged in a joint venture in Malaysia with Cahya Mata Sarawak(CMS), which is controlled by the Taib family.

CMS and Deutsche Bank are the principal shareholders of the finance company K & N Kenanga Holdings, based in Kuala Lumpur, with its subsidiary Kenanga Deutsche Futures being an accredited broker on the Malaysian stock exchange.

In 2005, Deutsche Bank was the sole book-runner for the US$600 million (RM1.82 billion) listing of Sarawak International Incorporated in Labuan, Malaysia's offshore financial centre, said BMF.

Before December 2004, Deutsche Bank had arranged a US$135 million (RM409 million) loan for the Sarawak Economic Development Corporation, a state agency controlled by Taib.

Deutsche Bank International's Jersey and Cayman branches are administering the Jersey-based Sogo Holdings Ltd, through which several Taib family assets in the US are held, BMF further claimed.

In May, the Swiss Financial Market Supervisory Authority Finma had announced an investigation into Taib assets in Switzerland, at the instigation of Swiss President Micheline Calmy-Rey.

At the beginning of June, the Malaysia Anti-Corruption Commission had announced that it is investigating Taib for alleged corruption.

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