UMNO-Barisan movie with 27 disclaimers? The problem with UMNO’s self-esteem

Business and Politics makes strange bedfellows but MAHATHIR made some men very rich but Mahathir says Datuk IQBAL OF FARLIM GROUP WAS ANWAR’S CRONY

Tun Daim Zainuddin a career of shooting poison darts, laying booby traps. and knifing friend or foe in the back

“Who was behind the purchase? Many have alleged it was Daim because he had Mahathir’s ear at that time. In the Umno style of those days, the word was spread to the Malays through the vernacular papers and the grapevine that the Malay community would benefit from Koon Swan’s fall. But I think the only people who gained were the Umno elite. Their greed got worse and worse until Daim himself has been accused of taking Umno’s assets and keeping these for himself. It is a classic example of the political and economic hegemony the Umno elite has enforced on the rakyat (people).”

Smoking kills yes, but should it kill the art and craft of cinema, is what movie producers are asking in response to the information and broadcasting ministry’s order to show disclaimers. While the pros and cons of such a move are being fiercely debated, it would be worthwhile letting our imagination run wild and look at what would happen if more government orders were issued against ills of all kinds.

In other words, what if more ministries decide that cinematic representation of social and other ills could influence citizens and hence, we need to have disclaimers at the beginning of the movie and in the middle of scenes.

We could then picture a billboard saying: “India’s first movie with 27 disclaimers. Indeed a movie with many messages. Book your tickets today.” And the producer would caution us in an interview: “Sorry folks, the movie is ten minutes longer. Do walk into the hall with another bucket of popcorn or even a chessboard, if you please.”

Soon after the main titles roll, we’d have a string of actors, sometimes the same ones again, declare: “I don’t drink in real life. Excessive alcohol consumption can have grave effects on your physical health”; “I’ve never paid or taken a bribe in my life. Corruption is the scourge of society”; “I believe women have an equal place with men in society” and so on.

And then when Salman Khan is bashing up the villain, you’d see a scroll running: “Rioting is illegal. Leave law and order to the police…” Or when SRK cozies up to a working woman on screen, you’d be left reading, “Unwelcome verbal, visual or physical conduct of a sexual nature that is severe or pervasive constitutes sexual harassment and you are liable to punishment.”

Incredulous as it may seem, such cinema could well be an absurdist interpretation of the Alienation technique in theatre. Bertolt Brecht, the German poet, playwright and director, who developed this style, sought to “distance” his audience from getting involved in the drama. Often, his plays had characters literally move out of their acting space and intone a message, summarize the plot or hold placards bearing propagandist statements.

Jokes apart, would this help make cinema more meaningful, let alone create a healthier society?

“The truth is always stranger than fiction and God moves in mysterious ways. No one expected Glenn Knight to show remorse and to write about all his old cases. And Glenn did not just mention Koon Swan but also other big cases he prosecuted on behalf of his government. Maybe Singapore didn’t like a dynamic young leader who can rival the likes of Lee Kuan Yew. It reacted harshly and threw the book at Koon Swan. I was in Singapore with him at that time and we approached a UK law expert who told us Koon Swan had solid grounds to fight the Singapore case but in the end he buckled,”

Indeed, amongst those who follow the political development of the Malaysian Chinese, grousing at the injustice heaped upon Koon Swan is not new. The bitterness was widespread and deep but in the 1980s, former premier Mahathir Mohamad ruled with a fist of iron, freely using the Internal Security Act and Sedition laws to jail political opponents and shut out criticism.

His greatest accomplices were former Finance minister Daim Zainuddin and the mainstream media, which continuously churned out stories to portray the situation that Mahathir deemed most useful to his plans. It did not help that Mahathir refused to grant licenses to independent press organizations, and until the advent of the Internet, news that carried a neutral or pro-Opposition picture did not exist in Malaysia.Koon Swan was labelled as a vile traitor who not only betrayed his community but also swindled their poor, many of whom lost their life savings when the MCA-linked co-operatives they placed money with crumbled.

the uproar raised by Glenn Knight’s recently published book “Glenn Knight: The Prosecutor”. The former top legal eagle admitted he had wrongly prosecuted Koon Swan in the 1985 Pan El Industries case.

Glenn said he felt pained for putting Koon Swan behind bars on discovering his mistake years later, and he had since apologised to Koon Swan. The admission made the top news in all the major Chinese papers in Malaysia.

Koon Swan was slapped with 15 charges of fraud, cheating, stock market manipulation and abetment of criminal breach of trust (CBT) in the collapse of Pan El. He was sentenced to 18 months jail and fined S$500,000 (RM1.2 million) upon conviction in 1986.

Despite quitting the MCA and serving his Singapore sentence, the Malaysian authorities were not appeased. He was jailed again in Malaysia and made a bankrupt.

“It was the worst humiliation for any man to endure but Koon Swan bore his cross with courage and dignity. He was 10 years too early, but we hope he will speak out now. In 1998, Anwar was in a better position to fight back against guys like Mahathir and Daim. Even still, look at how he suffered, I really take my hat off to Anwar,” said Jui Meng.

“Perhaps now, Malaysians can understand how much courage it takes to fight the evil in our political system. When I talk about the the fight between Good and Evil, I can sense some people think I am exaggerating. But make no mistake, the fight is still on and in fact at the very peak. Malaysians must reject Evil in Umno-BN. They must always choose to follow the light and never darkness.”

the “vindictiveness” of the Mahathir administration for the second-round of punishment. He believes that it was not only to ensure that Koon Swan could never make any political comeback but to pave the way for the takeover and asset sales of the MCA-held assets.

“Multi-Purpose was a huge conglomerate that could affect East Asian markets. It held the Malaysian French Bank, Bandaraya, large tracts of plantations and estates. It also had shipping interests. Yet Ling Liong Sik who took over as the new MCA president had to sell it off for a mere RM500 million. It was easily worth several times more,”

Now 72, Koon Swan made his political debut, winning a parliamentary seat in Raub, Pahang. The following year, he was elected to the party’s Central Committee and appointed Chairman of MCA Wilayah Persekutuan State Liaison Committee. In 1982 he clinched a landslide victory in the Damansara parliamentary seat, beating the Opposition in their fortress.

In 1984, he was appointed as vice-president of the MCA. However, he was soon sacked from this post along with 13 other members for urging the party to investigate its member records for the presence of non-existent people, an issue that had sparked off factionalism and crisis within the MCA. Koon Swan and the other 13 were all reinstated two months later with the support of 1,600 MCA members in an extraordinary general meeting.

In November 1985, Koon Swan was voted as president of the MCA, winning 76.9% of the votes cast, the largest majority in the party’s history, and the first challenger since 1954 to win national leadership.

Koon Swan was then at the height of his popularity, symbolising a new breed of Chinese leader – smart, savvy and people-oriented. Regarded as a financial wizard Koon Swan originated the Deposit-Taking Cooperatives or DTCs, which sought to accumulate capital for the Malaysian Chinese through investments.

But with the onset of the 1985-86 recession triggered by plunging world oil and palm oil prices plus Koon Swan’s own troubles, mismanagement of the DTCs’ funds led to a scandal with the central Bank Negara stepping in to freeze the assets of up to 35 DTCs. The total loss was estimated to be RM3.6 billion, and the depositors only recovered 62% of their deposits.

The Pan-El case and its outcome not only changed his fate and the MCA’s but also greatly impacted on the Malaysian Chinese community. They were visibly demoralized and cowed by his jailing. Many turned against him and his second wife Penny Chang, blaming them for the hard times sparked by the DTCs’ fall and the slide in the economy, which contracted by 1.2% in 1985.


Pan El’s collapse also caused the Singapore and Malaysian stock markets to halt trading for three days. The high-profile Pan El case resulted in Glenn Knight being awarded the Public Administration Gold Medal.

In the book, the 63-year-old Glenn had written about the many high-profile cases he handled. He wrote that in 1996, a case similar to Koon Swan’s came up for hearing and Singapore Chief Justice Yong Pung How “concluded that I was wrong to charge Tan for the offence”.

“It was extremely painful for me to suddenly discover that the Singapore courts had got it wrong. It was a highly significant case that led to enforceable regulations being introduced into Singapore’s stockbroking industry. As Koon Swan was the head of the MCA, I put up a paper on his involvement in the Pan-El saga but left it to my superiors to decide his fate as he was out of (Singapore) and in Malaysia. In the end, the government decided that the CAD could prosecute Koon Swan,” Glenn wrote.

“Chief Justice Yong was of the opinion that the section I had charged Koon Swan with was wrong in law for we could not charge a person for stealing from a company because as a director, it was not a breach of the law in that sense. Chief Justice Yong concluded that it was wrong to convict anyone for stealing money if the wrong charge had been used to begin with. The judgment shattered my belief in our legal system. In the United Kingdom, such a landmark judgment would have set aside Koon Swan’s conviction but our jurisprudence does not allow for this though technically, Koon Swan could still have been granted a pardon.”

Glenn also told of how he apologized to Koon Swan in 2010. He said Koon Swan was very emotional on hearing the matter.

In 1991, Knight himself was charged with CBT and later jailed in Singapore. He was struck off from practising law in 1994 but was reinstated in the Law Society of Singapore in 2007.

As for Koon Swan, who is currently overseas, he has said he would decline comment until he has read Glenn’s book.

Everyone knows that Daim is the silent type; so silent, in fact, that the victims of his scheming and conniving have fallen like ten pins without ever knowing what hit them. He has, on the quiet, made a career of shooting poison darts, laying booby traps. and knifing friend or foe in the back. His hand is never seen, but his mark is everywhere. Truth to tell, he has been at the root of many national crises, but his name has never been smudged, thanks to the wealth he wields and his bond of friendship with Dr. Mahathir.

Most members of Umno’s new generation are aware that Daim is an acquisitive millionaire and a macho man with a taste of young women, but they concede him these weaknesses because they see in him a clean and competent Economic Adviser to the Government. But the generation of Harun Idris, Musa Hitam and Manan Othman to name just a few of the old hands – they are the ones to ask in order to discover who the real Daim is. It was Datuk Harun who plucked Daim up from the depths of failure in the salt business. Daim’s wife, Mahani and Harun’s wife, Salmah were good friends and an influential pair in the early 1970s. It was wife power that moved Harun to give Daim 160 acres of prime Kampung Pandan land. And thus Syarikat Maluri was born.

There is no use speculating over how much Daim paid Harun. After all, the two were fast friends. For the gory details, just ask Low Kiok Bow or Thamby Chik. They can relate how Daim cheated a land broker and greased Selangor state executive councillor and Mahathir’s brother-in-law, Ahmad Razali for that piece of land.

Of course, Daim still had to pay for the land. In those days, it was not easy to borrow from a bank. Hence, he was forced to corrupt Bank Bumiputra. Lorraine Osman and Rais Saniman know how much he spent. Manan Othman can no doubt confirm the figure, he was so close to Daim that they tried to share a girl friend, with Manan often borrowing the bedroom at Daim’s office in Taman Maluri.

Daim’s elevation as Senator and, subsequently, Minister of Finance, was part of Mahathir’s strategic plan. Mahathir’s choice should surprise no one, after all the two were intimate friends from the same kampung in Seberang Perak, Alor Setar. Upon becoming Prime Minister on 16 July, 1981, the first thing on Mahathir’s mind was how to sideline his archenemy, Tengku Razaleigh Hamzah. Daim told everyone he had no interest in politics, but all the while he was confident of getting the Finance Minister’s job after a stint with the Senate. A few months after joining the Senate, Daim became Chairman of Fleet, which owned the New Straits Times. In 1984, he finally got his dream job and became the third most important man in the Federal Cabinet, after the Prime Minister and his deputy.

Musa Hitam, the Deputy Prime Minister, was at first oblivious of the closet ties between Mahathir and Daim. Innocently, he expressed to Mahathir his disquiet over Daim’s wheeling and dealing, particularly his award of projects and contracts to his own associates and cronies. It must have baffled him when his complaints fell on deaf ears although he was Deputy Prime Minister, he has no say when it came to economic matters, particularly privatisation and the assignment (to supporters) of economic projects. How disappointed Musa must have been to find that Daim could not care less about his effort to help his supporters secure some projects or contracts. Daim succeeded in making millionaires of such cronies of Wan Azmi, Halim Saad, Tajuddin Ramli,
Samsuddin Hassan, Razali Rahman and Tan Sri Basir, but Musa in the end was cast off as a poor ex-DPM. Musa once complained to Mahathir that Daim had stolen a number of supporters’ project proposals, but again Mahathir ignored him. These were the first acts in the eventual breakup of the Mahathir-Musa partnership. As the interests of Mahathir and Razaleigh bloated, Musa got squeezed out.

Many Umno members assume that Razaleigh is Musa’s number one enemy. In fact, the reason for the 1986 split in Umno must fall on Daim. It was he who drove Musa to the edge until he had no choice but to resign. Again, Daim’s man of few words demeanour to his advantage. Few knew of his behind-the-scenes role in that Umno rupture not many more know it today. One really should not wonder why Musa called a truce Razaleigh and the two decided to collaborate in the 1987 fight, the one that eventually caused Umno to be outlawed. At that time, Daim was almost invincible, what support coming from such strongmen as Sanusi Junid and Anwar Ibrahim. The comradeship of the three was rock solid, and the Musa-Razaleigh camp could do nothing except to make a joke of it by giving them the nicknames AIDS.

The formation of the new Umno, Daim and Mahathir had first to get rid of the Lord President, Tun Salleh Abas. Again, Daim was the chief plotter in the sacking of the pious and respected Tun Salleh, and his replacement with Tun Hamid Omar, a playboy and chronic gambler, but Mahathir’s and Daim’s schoolmate. The appointment of Tun Hamid Omar triggered the collapse of the integrity and the independence of the judiciary.

Finance Minister, Daim persuaded Mahathir to give the Economic Planning Unit and Treasury full power in implementing the privatisation policy. Hence, it was no longer necessary to call for tenders for government projects. Instead, the projects were awarded directly to favoured companies. And so began the era of wealth accumulation by him and his cohorts. The United Engineers Company, bought for RM2, changed into a multi-million- ringgit corporation. As Finance Minister, Daim practically ordered banks to lend to companies that he himself owned. And no Daim crony every complained of difficulty in securing bank credit. Indeed, bankers lived in fear of Daim. Having appointed Wan Azmi and Basir to head Malayan Banking and Bank Bumiputra, he would give any project to any of his cronies because funding was not an issue.
If those physical projects were not enough, Daim also took every opportunity to take wealth from the share market as well. Every time the Treasury approved a company for listing on the stock exchange, Daim cronies received their lion’s shares. That was how Southern Bank, Resort World, Sports Toto, Berjaya, Tanjong and scores of other blue chip firms landed with Daim and Company. Once, when share values were high, Daim boasted among friends that his visible wealth alone totalled RM65 billion. To shut the mouth of Barisan Nasional leaders, Daim gave lucrative projects to Samy Vellu and Ling Liong Sik so that their children could be big-shots in batches.

Daim managed to fool Umno members into believing that Mahathir would not let him go although he had asked to be relieved of his Cabinet post on a number of occasions. With Musa and Razaleigh out of the picture, Daim could grab as much wealth as he wanted without even Mahathir stopping him. Besides, he was Umno’s treasurer and he could make it look as if the companies he controlled were those in which the party had a stake.

Daim’s avarice damaged not only his own image as finance minister, but also Mahathir’s and Malaysia ‘s reputation with the international community. It is said that he used to demand exorbitant fees for himself in negotiating contracts involving foreign suppliers. The chairmen of Japan ‘s two biggest banks – the Bank of Tokyo and Sanwa Bank – once complained to Mahathir that his Finance Minister demanded commissions that were too high when negotiating yen loans. Margaret Thatcher, too, has complained about Daim’s role as a commissioned agent. He had – or still has – accounts in Zurich , London , Hong Kong, Tokyo , Singapore , Caymen Island , Channel Island and Virgin Island . Indeed, instead of keeping his billions in Malaysia , he has stashed them overseas.
With his immense wealth and far-reaching influence, Daim eventually became a burden that Mahathir could no longer bear. In every deal he made, there was something in it for himself. It was not beneath him even to conspire with Lee Kuan Yew to snatch KTM land in Singapore . The Malaysian Cabinet had no knowledge of this. But this issue of Malaysia being cheated by Lee Kuan Yew and Daim is far from over.

Mahathir eventually realised that he had to end Daim’s lordship over the Finance Ministry. And so he told him to quit.

Mahathir worried that if Daim continued as Finance Minister, complaints would come not only from Vincent Tan, Ananda Krishnan, Arumugam and other members of the Malaysian business elite, but also from foreign leaders. Signs of a Daim-related scandal were ominous and it could break anytime in Japan or Britain , therefore, Daim had to go.

Daim’s resignation was planned such that it would not appear as if he had been sacked. Indeed, it does not make sense why a powerful Finance Minister, rich and in control of so many public companies, would suddenly quit simply because he had lost interest in the job. The truth is that he was ordered to resign. Observers will recall that Mahathir’s first comment on the so-called reaction was, ‘He has asked several times for permission to resign, and I have finally allowed it. I hope Daim would not leave the country after resigning’. That statement was pregnant with meaning. Mahathir knew Daim was sulking. So did Anwar and Sanusi. Mahathir retained Daim as Umno Treasurer for a good reason, he wanted to ensure the safety of Umno money, a lot of which was under Daim’s control.

But Daim who holds so many of Mahathir’s secrets, is only a sly one. After resigning, he ran off to live in his San Francisco residence. He told the Malaysian public he wanted to study at Harvard, but in fact he wanted to leave Malaysia . Mahathir, who was familiar with Daim’s antics, pleaded with him to come back, saying he need him to advise on economic matters. Daim returned and announced that Mahathir had named him Economic Adviser to the Government. Rafidah asked Mahathir to confirm this, but all she got was silence. Daim was never formally appointed as Economic Adviser, a post which Tun Raj a Mohar once held. The appointment is the prerogative of the Public Services Department. Daim gave himself the job. To keep Daim happy, Mahathir allowed him to open an office at the Economic Planning Unit, and this strengthened the public perception that he was still in control as far as economic affairs were concerned.

When he was to told to resign as Finance Minister, Daim asked Mahathir to appoint Anwar Ibrahim to the job. Obviously, he thought this would help to ensure that his skeletons would remain closeted. He warned Mahathir of the peril that Rafidah would be to both of them: the secrets they shared would be uncovered. Daim also persuaded Mahathir to appoint Mustapha Mohammad as Anwar’s deputy because these two could be depended on to fill up the holes he had left gaping. Anwar is nobody’s fool, but he sacrificed his idealism to protect his towkay.

As far as we know, no Finance Minster in this world has retired a billionaire, except Daim. In the book Daim yang Diam: Sebuah Biographi (Daim the Silent: A Biography), Daim explains his retirement: ‘I am happy in retirement. It was too heavy a responsibility. In truth, I love the business world. Business is in my blood. I love to make money. I know how to do it. I can do it just by sitting in this chair. On a lucky day, I can make millions.’

Friend of Soros

According to an internal bank analysis, collaborated by the corporate community, and from Daim crony Amin Shah, Daim’s wealth, in ringgit and foreign currencies kept overseas currently amounts to RM20 billion. With so much money at his disposal, Daim can manipulate the Kuala Lumpur Stock Exchange. He showed his hand in 1991, just to prove how much influence he wielded. After selling off his stocks, he made a statement to the effect that the market would crash. And crash it did. As we can all recall, even Mahathir could not help but make a wry remark when Daim boasted that he invested in KLSE only for pocket money. But to his good friend, Daim said he could turn in profit on RM90 million a day when the market was up. When the market plummeted in October 1991 Daim bought back his share on the cheap. When the market turned bullish again 1995 and 1996, Daim made billions of ringgit from it. This, then, is what the work of an economic adviser amounts to.

So it turns out that Soros is not the only big time market manipulator and currency dealer. Daim met Soros twice in London when the ringgit was being hotly traded. Anyway, when the ringgit fell below RM4 to the US dollar, Mahathir asked Daim for help and, according to a source in Singapore, he lost RM1 billion trying to prop up the Malaysian currency. To lose that much in currency trading, imagine how much money he had at his disposal.

The falls in currency and share values put Mahathir in a feverish panic. He knew his policies and his own belligerent attitude were partly to blame. Seeing Mahathir in such a frenzied state, Daim recommended that he declare a state of emergency to enable him to restore the economy and at the same time, bury the corpses that were beginning to stink. We hail the Chief Secretary to the Government and the Solicitor-General for opposing the move.. If Daim’s plan had been followed, Mahathir would turn dictator and the Malaysian economy would be utterly ruined. Having failed to declare an emergency, Mahathir set up the National Economic Action Council, headed by Daim, with the Economic Planning Unit as its Secretariat. The original plan was to give the NEAC complete autonomy, but the Cabinet ministers opposed this for fear that they would lose any vestige of power they had left. Eventually, the council became merely an advisory body, with the Cabinet having final say on its recommendations.

The establishment of the council was a wedge between Anwar and Daim. Thus, two old friends who had together stood behind Mahathir against Musa were now turned against each other. All of the council’s recommendations were rejected by the Cabinet and Bank Negara. Daim openly assailed Bank Negara for dismissing his proposals, such as those relating to interest rates and credit control. We salute the Bank Negara Governor for maintaining a prudent monetary policy in the face of Daim’s bullying and insults. Unlike Daim and his cohorts, Bank Negara’s officials are not self-serving. Daim’s appointment to the NEAC was a major national mistake.

Going by press reports of its deliberations so far, the NEAC’s sole preoccupation is with saving mega corporations from bankruptcy. No doubt, these are Daim-related companies. Daim has yet to show any concern over the rise in the price of chillies, or the leaps in fish prices or how the price of rice has boiled over. Neither has he talked about small businesses in their death throes. Class F contractors going bankrupt or kampung road projects being abandoned. In his dictionary, there are no entries for the small man’s worries, nothing about low-cost houses, water cuts or study funds for the children of poor Malays. In fact, it contains only billion size figures. While the Malaysian economy is close to ruin, Daim remains a billionaire, living a life of glamour, jet setting with his new wife Naimah and the attractive Josephine , an Indian lass who helps him run one of his firms, the International Malaysian Bank.

We have merely given a sketch of who the real Daim is. A thorough account will soon be available in book form. We recommend the book to Umno members, especially those with big ambitions, because they will learn much from its fantastic but true tales of economic and political intrigues. We denounce the likes of Vincent Tan and Tan Phek Khiing for land-grabbing, but perhaps we should ask the Menteri Besar of Johor and the Menteri Besar of Kedah how much land Daim has taken. Ask Sanusi how much Daim paid to the Kedah government for 12,000 acres in Sungai Petani and how much profit he made from them. For 12,000 acres, Osman Arof had to be sacrificed. The true story of the Daim-Sanusi conspiracy in Kedah will be exposed in the book.

Umno is at a crossroads and has to decide wisely where it is going. One road heads to glory, where stability and democratic practice will abide. The other leads to division, autocracy and ultimately, utter destruction. The call for reform, which used to be made only in whispers at small, secretive gatherings, is becoming louder. Umno members, showing that they can no longer contain their restiveness and frustration, have begun to openly debate the need for change, even at party conventions. Can there be a clearer indication that they have reached their tether’s end, that they can no longer stomach the leadership’s undemocratic attitude and the prevalence – whether in the party or the government – of favouritism, cronyism, nepotism, graft and other misdeeds? Malay nationalism is dead and materialism and egoism are running amok.

We cannot depend on the Umno Supreme Council to initiate reform because few of the members have the guts to speak up. In fact, the council has lately been transformed into a monologue theatre. But of course even a monologue can flop without good supporting players – fools, clowns, jesters, attendants and the oh-so- important flatterers. As far as these bit players are concerned, Umno’s ideals and principles are not as important as their jobs. This keep-your-mouth- shut syndrome serves only to embolden the party leadership in its conceit, arrogance and haughtiness. A president has become a dictator. Woe are the Malays and Umno. What is to become of them? That is a question only Umno members can answer.

Professor Mohamed Zain
Professor of Technology & Strategic Management
College of Business & Economics
University of Qatar