There are so many things wrong with our democracy. A dysfunctional judiciary, stunted and already disintegrating party system, politicised and unprofessional media, polarized society, growing intolerance, xenophobia and the list goes on. But whatever the affliction is, the one underlying factor is always corruption. We know, corruption is an old song sung by all politicians everywhere. But this time around, we are not talking about the corruption of the old, the established and the already corrupt, but about the corruption of a fairly young generation of politicians who will possibly remain in Maldivian politics for another 30-40 years. We are talking about the corruption of a generation of politicians who could have been defined otherwise.
What went wrong?
The Maldives is celebrated as a model for peaceful transition to democracy. The opening up of the political system that began in 2003 led to free and fair elections fairly quickly. The old autocrat was not arrested and thrown into jail as happens in so many other countries, but instead given a hefty pension package and left to himself for the most part. Three branches of the state were made separate and independent, and the fourth estate was given its due freedom. What went wrong?
What went wrong is strikingly similar to what goes wrong in so many African democracies. The liberator who wrenches his people from the clutches of exploitative colonial powers is hailed in as the good leader, and then the people are forever stuck with him. And he is good, at least in the prologue. He must have believed in freedom, in people’s right to make their own destinies and to live a good life, to have fought so long and hard and put his neck on the line. For his bravery and courage, he is rewarded with legitimacy, people’s love and admiration. And he is handed the ultimate prize (via a free and fair election, of course)- the chance to become the president of the first real democracy in that country. But somewhere along the line, the leader miscalculates how far he can push his legitimacy and thinks himself above the law. In order to ‘save his people’, he convinces himself that he has to do whatever it takes, and sometimes the whatever part involves ugly nasty immoral things like corruption, bribery and appeasing big businesses at the cost of the public good.
Let’s not forget the party machinery that often ushers in these liberator-type leaders. What eventually ends up becoming a political party often starts out as a movement, a movement for freedom, liberation and democracy. The sole purpose of the movement-cum-political party is to free the people. And as such, upon independence or at the end of dictatorship, the party becomes a mere vehicle for the liberator-leader to ride in to take his rightful place as the head of the new democracy. Sadly, the party ceases to become anything more. Tangled in the politics of the day, the party fails to mature. It lacks a clearly articulated ideology, a set of values or anything for that matter that can define it independently of its liberation history. And just for the record, no, five key pledges does not amount to an ideology. People cannot be expected to analyse the party manifesto and derive the party’s philosophy on their own, if it exists at all. And no, Maumoon Abdul Gayoom’s personality does not amount to an ideology either.
What is so wrong now?
The problem is, not only does the party continue to be the liberator’s vehicle to remain in power but it begins to destroy all other parties around it, sometimes by guns and outright violence, but in our case with ‘secret’ deals that are not only accepted, but boasted about in political circles and laughed over at cocktail parties. “Hey, I paid Mrf 5 million and a BMW for that guy over there” wink. “Oh really, well I paid about Mrf 15 million for this guy right here. Prices keep rising by the day…we better buy up all available on the market before prices go through the roof! Hohoho!” And so, riding high on liberation victory, the leader and his party come to practice a vile sort of politics. A politics of “only we can be trusted with power” and “damn those slow and tedious democratic process.” In short, the politics of arrogance.
Of course, the liberator and his party machinery try to justify this politics of arrogance. They say that if they do not deliver and make good on their key pledges, then not only may they lose elections come 2013, but that, lo and behold, they will surely lose it to the old dictator or his brother! Not only that, if the MDP fails to deliver, ‘the people’ will cease to believe in the promise of democracy! And God forbid, we cannot let these things happen, not after all the blood and tears, not after trying so damn hard to go by that complicated and cumbersome constitution.
Therefore, in its mad frenzy to get everything done before the clock strikes 12 o’clock in 2013, the MDP government, instead of putting up a steady honest fight, is buying the entire game and in the process, relying less and less on democratic processes. We need not look beyond parliament for evidence. Let us be clear, the MDP is not outwardly undemocratic. Besides the occasional slip of the tongue, it sticks to its narrative of democratic governance at the podiums. But away from the cameras and the public’s eye, the party and most Maldivian politicians engage in what can be termed as real deal-making. And this real deal-making almost always subverts democratic processes. Surely, this has to be informal politics at its best.
And again, just for the record, given the blatant political prostitution in parliament, even if the government builds an apartment for every Maldivian (doesn’t matter if they can afford it), a hospital (too expensive to maintain) on every island, establishes a fast ferry between all islands and makes every youth drug-free (but perhaps jobless), that does not prove that democracy worked. It merely proves that the MDP party machinery and its tactics worked. And these are two very different claims that have far-reaching consequences.
Why is it wrong?
The bitter result of the politics of arrogance and the corruption and bribery it necessitates is that it is imbibing a new generation of politicians with the view that politics is ultimately about being in power. That without absolute power, you cannot get anything done. That power is the be-all and end-all of politics. In doing so, they have changed the narrative of the land from “what is good?” to “what is the lesser evil?” And that is a damn shame. For if there was a reason I voted, it was because I trusted my elected official to make wise decisions that would contribute to me living well, and at the same time contribute to the greater good of the society. And I also trusted that official to not always see the greater good in monetary terms. And I also trusted that official not to cast the building of a harbor, an airport or a housing project as incompatible with sticking to democratic processes.
So the story goes that, the politics of arrogance not only deprives a nation of honest and virtuous politicians, but also buries the common good and on its tomb, plants the seeds of political power and waters it with the greed and lust of an emerging generation of crass politicians who are morally stunted and politically shackled for years to come.
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Climate finance presents a governance challenge to ensure it reaches the right places, Maldives’ Ambassador to the UN in Geneva, Iruthisham Adam, has told Transparency International (TI).
“The Copenhagen Accord figure of US $100 billion per year by 2020 is a conservative estimate of needs, yet even this amount presents profound governance challenges,” Adam told TI.
“How can we generate this amount of money? How can we manage this funding? How can we distribute it to those who need it most and assure ourselves that the money is well spent and not abused?
These challenges are at the heart of why it was difficult to come to an agreement on climate financing at COP15. We also need a UN Framework Convention on Climate Change (UNFCCC) oversight bodies to regulate the flows, distribution and efficacy of the fund. Climate financing has to be accountable and transparent in order to avoid abuse and inefficiency and build confidence and trust. Everything has come to a standstill because we are not able to build trust within the system, on which the whole UNFCCC negotiations are dependent. Procedures must be in place to allow local communities, NGOs and other stakeholders oversee the funds and build this trust.”
Maldives Industrial Fisheries Company (MIFCO) employees have submitted a petition threatening to strike if salaries are not increased by 20 percent.
Haveeru reports that over 100 staff signed the petition giving a three-day notice before beginning the peaceful strike.
While MIFCO staff had refrained from complaining before in light of the company’s financial status, the petition claims that employees’ “patience has run out after seeing the unnecessary expenditure by the company.”
Alleging corrupt or incompetent practices, the petition claims that Managing Director Ali Faiz’s refusal to import spares for the cold storage unit at Koodoo and the company’s other assets had left them “beyond repair.”
The employees allege that Faiz’s overseas trips cost MIFCO over Rf6 million (US$466,900).
Police have confirmed a request from the Criminal Court to bring former Atolls Minister Abdulla Hameed before a court in the Maldives, after a summons could not be delivered to him in a pending case.
Several hearings have been cancelled in a high-profile corruption case involving Hameed, who is the brother of former President Maumoon Abdul Gayoom, after the court was unable to determine his whereabouts and deliver a summons.
Police said that the Immigration Department had been instructed to hold Hameed’s passport should he ever return to the Maldives.
Police spokesperson Sub-Inspector Ahmed Shiyam explained that when the court first requested police to produce Hameed he was not in the Maldives.
”But the court have not yet issued an arrest warrant or requested his arrest via Interpol,” Shiyam said. ”His whereabouts remain unknown.”
Hameed is being sought by the court in a trial concerning corruption allegations in the former Atoll’s Ministry’s Audit Report.
The audit of the Atolls Ministry’s showed that 17 staff employed by the Ministry in 2007 never appeared for work but were being regularly paid by the Ministry, at a total cost of Rf1.4 million (US$109,000).
According to the report, a further 38 persons employed by the ministry were not assigned any daily work, but were also paid regularly. The report stated that occasionally the heads of atolls were brought to Male’ and kept for a long period of time without assigning them any duties. One such atoll head was brought to Male’ in October 2007 and left 10 months later in August 2008, at a cost to the Ministry of Rf 241,862 (US$18,800).
Web of corruption
In March last year, minority opposition People’s Alliance MP Ahmed Nazim pleaded not guilty to charges of defrauding the atolls ministry.
At a press conference in August 2009, Chief Inspector Ismail Atheef said police had uncovered evidence that implicated Hameed along with Eydhafushi MP Ahmed “Redwave” Saleem, former director of finance at the ministry, and Deputy Speaker Nazim in fraudulent transactions worth over US$260,000 (Mrf 3,446,950).
Police exhibited numerous quotations, agreements, tender documents, receipts, bank statements and forged cheques proving that Nazim received over US$400,000 in the scam.
A hard disk seized during a raid of Nazim’s office in May allegedly contained copies of forged documents and bogus letter heads.
Police maintain that money was channelled through the scam to Nazim who laundered cash through Namira Engineering and other unregistered companies.
Police further alleged that MP Saleem actively assisted the scam in his then-position as director of finance at the ministry, while Nazim’s wife Zeenath Abdullah had abused her position as a manager of the Bank of Maldives’ Villingili branch to deposit proceeds of the fraudulent conspiracy.
Police said Hameed, also long-time Speaker of the People’s Majlis, played a key role in the fraud by handing out bids without public announcements, making advance payments using cheques against the state asset and finance regulations, approving bid documents for unregistered companies and discriminatory treatment of bid applicants.
The structure of the Judicial Services Commission (JSC) is compromising its accountability and obstructing the creation of an independent judiciary, says Professor Murray Kellam, a former Australian Supreme Court Justice who has spent several weeks observing the group.
The UNDP brought Kellam to the Maldives to observe the JSC based on a recommendation in a report by the International Commission of Jurists (ICJ) that suggested the commission be subjected to independent outside oversight.
As well as a former Justice of the Supreme Court of Victoria, Kellam is the current Chief Commissioner of the Tasmanian Anti-Corruption Commission and also has extensive experience assisting with the development of legal systems in countries such as Burma and Bangladesh.
He has also been appointed an Officer of the Order of Australia, an award given for distinguished service of a high degree to Australia or humanity at large.
“I think there’s a real problem when you’ve got members of both the executive and the legislative body administering judicial affairs,” Kellam said, on conclusion of his visit to the Maldives.
“You have the Speaker, Attorney General and an MP sitting in judgement on their own recommendations. That situation doesn’t need describing any further.”
Kellam said his observations were not intended to be critical of the members of the JSC, but rather to assist in the development of an independent and respected body.
In other countries it was usual for the Chief Justice to chair the body responsible for judicial accountability, but the members were made up of respected people from the community “rather than those allied to the executive or legislature.”
“The process in your Constitution here is that [in the event of] gross misconduct and gross incompetence, the Majlis (parliament) has the job of dismissing them, and that’s consistent with other places in the world. But the problem is that the body making the recommendation is also the membership.”
Kellam was provided with full access to the JSC’s meetings and files during his visit, however he acknowledged that language was a barrier – most significantly, the lack of official English translations of most legislation.
“The unofficial translation of the Constitution is pretty good, but I have doubts about the accuracy of the translation for the JSC Act. The UNDP assisted, but the [language gap] makes it pretty difficult.”
However, Kellam said that he agreed with the ICJ’s recommendation that parliament should evaluate the JSC “and ensure it operates more transparently.”
“There may be an argument that the appointments and complaints processes [for judges] should be separated,” he said. “At the moment it appears that the expectations of the authors of the constitution are not being met.”
There had been, he noted, a requirement for the JSC to undergo training, ”but that was removed by the Supreme Court and subsequently by the legislature.”
Urgent legislation required
Beyond a review and possible reform of the JSC by parliament, the Majlis needed to urgently pass a Criminal and Civil Code, a Penal Code, and an Evidence Act, as currently, “the courts have no guidance as to the exercise of their powers under the constitution.”
“These legislative enactments ensure consistency on the part of the courts and a proper legal basis for the process of litigation,” he said, adding that under the current circumstances, “I can’t see how the courts can operate. The importance of the legislature passing such legislation cannot be overstated.”
As for oversight, the parliament, he said, was entitled to take an interest in the functioning of the judiciary, as the courts were funded by public expenditure.
However, Kellam did mirror the concerns of the ICJ at the interference of the executive, and particularly, the “the extra-constitutional use of the Maldives National Defence Force and police and defiance of court orders.”
He noted the ICJ’s concerns over public statements of members of government meeting with judges and members of parliament imploring the President to ignore both the courts and the legislature: “Actions such as this brought Hitler to power,” he warned.
Judges needed to be able to make decisions contrary to interests of the executive, and should not be subject to pressure from the politically powerful, commercially powerful or any other specific social interest groups.
“I have in my own career made decisions the government was extremely unhappy with – but they did what they were told in due course, because that’s the way the rule of law operates.”
At the same time, “‘Rule of law’ does not mean ‘rule of judges’. Judges are not free to do as they wish. They are subject to the Constitution and the laws enacted by parliament. It is not their role to make disparaging
remarks about parties, witnesses who appear before them, or to send signals to society at large in order to intimidate and undermine other basic freedoms such as freedom of expression.
“Respect is not gained through coercive use of power. The judiciary earns respect by its performance and its conduct,” Kellam said.
Framework in place
The Maldives’ Constitution provided an excellent model for an independent judiciary, “much better than the ones in many countries I’ve worked in,” Kellam said.
“There was quite clearly a real endeavour to set up accountability mechanisms, such as the JSC, Anti-Corruption Commission (ACC) and provision for an independent prosecutor – a really significant step.
“But having a model is one thing, executing the plan is another. In the end that depends on the calibre and integrity of people who run these organisations. They need to set the gold standard in terms of behaviour, conduct and transparency.”
Paying judges generously was a significant part of the equation, he said, recalling a judge he met in Cambodia who drove taxis at night to avoid having to accept bribes.
Australia, he commented, had never had a judge convicted of bribery.
“Judges misbehave in Australia just like elsewhere, but we do not have corruption. I think that’s a reflection of accountability, but also a significant reflection of the fact that they are well-paid. As a judge in Australia you would have to be extremely silly [to accept a bribe], because the risk of losing your salary and all your pension entitlements is simply too high.”
Transparency trumps nepotism
In both his interview with Minivan News and a lecture held on completion of his visit to the Maldives, Kellam repeatedly emphasised the importance of independence.
It was not, he said, necessarily a obstacle to independence that the Maldives was a small country with myriad family, political and business connections.
“I chair the Anti-Corruption Commission in Tasmania, a state with a population of 500,000 people,” he said. “Many families have been living there a very long time, and everyone knows everyone else which is a reason why they brought an outsider like me to chair their Anti-Corruption Commission.
Transparency, he said, was the answer to the problem, and was as much a defence for those drafting contracts with those they knew as a means of mitigation corruption.
“There should be a declaration at the start of meetings, where interests should be stated,” he said.
“If you are awarding a contract to your brother-in-law, which can happen in Tasmania, it must be on the table. The person awarding contract should make the declaration. It must be a similar problem for judges in island courts here – judges here know the islanders, but you can’t have them disqualifying themselves.
“We have a jury system in Australia, and in a town with a population of 20,000 the jury will know all the victims and the witnesses. The important thing is that there is transparency and it is on the stable.
“Sunlight is the best antiseptic. The real problem of perception happens when these things are not out in the open – when they are done under the table, and somebody says ‘Hang on, he’s related or they had dinner the other week.’ If it is in public, decisions can be made impartially. If it’s disclosed you can look at the tender process and say ‘Not withstanding that this person is the uncle of the person delivering on the contract, on the face of it this is transparent.’ That’s entirely different to somebody awarding a contract to a relative behind closed doors.”
Rulings had to also be open to public scrutiny, and actively published and subjected to public analysis. Judges and their verdicts were open to scrutiny and criticism, Kellam said, and in Australia it was understood that judges did not pursue cases of defamation against them.
The economic case for justice
An impartial judicial system was a key factor in encouraging foreign investment, Kellam said, and could have a direct and significant impact on the economy.
This was something that Singapore recognised 15 years ago, he said.
“They understood the value of a civil system that is incorruptible and competent. They spent a lot of money on their judiciary and Transparency International now rates their civil legal system as one of the best in the world.
“Singapore realised that one of the best ways to attract investment was to have a system whereby international investors knew they would get a fair go in domestic courts. If you look at the circumstances in other parts of the world where investors have no confidence in the judiciary, that deters investment and takes it offshore. They’ll go somewhere else.
Citing Adam Smith, considered one of the founders of modern capitalism, Kellam observed that “Commerce and manufacturers can seldom flourish long in any state which does not enjoy a regular administration of justice, in which people do not feel themselves secure in possession of their property, in which the faith of contracts is not supported by law.”
As a foreign investor, Kellam said, “you want to know that contact you enter into with domestic partners will be understood and enforced by courts if there is a breach. You want courts to judge you impartially – you don’t want to be discriminated against because you are a foreigner.”
“Secondly, it’s no good getting judgement if no there is enforcement – which is a major factor in developing countries. Sure you can get a judgement, but it’s not worth the paper it’s written on because there is no process for getting it enforced, and you can’t turn judgements into anything productive.”
Singapore had recognised this, and become not only a hub for foreign investment but also a regional hub for commercial arbitration.
“People from around the region will use Singapore as a place of law and business,” Kellam observed.
“The constitution sets up [an independent judiciary] for principled reasons. But there are not only good arguments for these in terms of principle, there are very good economic arguments. But the judges have got to understand that, and they’ve got to build it.”
Perhaps tellingly, President’s Member of the JSC Aishath Velezinee observed on her blog that “not a single member of the Judicial Service Commission (except for myself) or staff attended Professor Kellum’s lecture.
“What cannot be ignored is that neither the JSC nor the judges have the willingness and interest or the knowledge and capacity to reform the judiciary in accordance with the Constitution, despite the rhetoric.”
The Supreme Court of the Maldives has issued a press release disputing the corruption allegations made against former Chief Justice Abdulla Saeed, who is currently a member of the Supreme Court bench, and a second Supreme Court Judge Ali Hameed.
”The stories published are all untrue,” the statement said. ”We advise not to conduct any attempts that will harm the sanctity of the courts and its judges and to keep all actions within the constitution of the Maldives.”
The statement said that repairing Supreme Court’s cars and vehicles was not within the job description of the judges and judges had no role to play in repairing the Supreme Court’s vehicles, after allegations that Hameed had twice repaired his car with Supreme Court funds.
No judge at the Supreme Court had ever received phone allowances or any other allowance, and no judge at the Supreme Court receives any allowance not mentioned in the constitution or laws, said the Supreme Court in its statement.
Local radio station SunFM yesterday reported that the two judges were accused of corruption and a case was filed in the ACC, alleging that the two judges had paid their personal telephone bills from Supreme Court funds.
SunFM quoted a senior staff member at the judiciary as saying that the phone bills of each of the judge totaled over Rf 17,000 (US$1323) each month.
”Last month judge Abdulla Saeed’s spent Rf 25,000 (US$1945) of the Supreme Court’s money as phone allowance,” SunFM quoted the source as saying.
SunFM also reported that judge Ali Hameed’s car was damaged twice in accidents and was also repaired using Supreme Court money.
The source in the judiciary also alleged that Ali Hameed had threatened a staff member at the Finance Department of the Supreme Court saying that he would be sacked if the did not hand over the money to fix the car after the second accident.
Former Chief Justice of of the Supreme Court Abdulla Saeed has denied allegations of corruption after a case against him and another former Supreme Court, Ali Hameed, were filed with Anti Corruption Commission (ACC).
Abdulla Saeed is currently a judge on the new Supreme Court bench, and was the Chief Justice of the Supreme Court during the constitutional interim period.
Local radio station SunFM reported that the two judges were accused of corruption and a case was filed in the ACC, alleging that the two judges had paid their personal telephone bills from Supreme Court’s funds.
SunFM quoted a senior staff member at the judiciary as saying that the phone bills of each of the judge totaled over Rf 17,000 (US$1323) each month.
”Last month judge Abdulla Saeed’s spent Rf 25,000 (US$1945) of the Supreme Court’s money as phone allowance,” SunFM quoted the source as saying.
SunFM also reported that judge Ali Hameed’s car was damaged twice in accidents and was also repaired using Supreme Court money.
The source in the judiciary also alleged that Ali Hameed had threatened a staff member at the Finance Department of the Supreme Court saying that he would be sacked if the did not hand over the money to fix the car after the second accident.
Judge Abdulla Saeed dismissed the allegations as ”lies”.
”W have never involved ourselves in any financial or administrative work of the Court,” Saeed told Minivan News. ”Any allowances we receive will be only those mentioned in the laws, and we do not have any other allowances.”
Saeed said the Supreme Court judges were ”very sincere in upholding the constitution and maintaining rule of law. I am very confident that no judge at the Supreme Court bench will violate any laws.”
He also said the financial report of the judges was submitted to the Judicial Service Commission (JSC) annually.
”The Commission has the power to oversee all our credit card transactions as well,” he said, adding that the Supreme Court was to issue a press statement over the allegations.
The International Commission of Jurists (ICJ) has called into doubt the JSC’s independence, noting in its recently-published report that “to date, JSC decision-making has been perceived as being inappropriately influenced by a polarised political environment. Also troubling is that members of the judiciary have been subject to threats and intimidation as well as improper inducements by both governing and opposition party members.”
Cabinet has agreed to strengthen the regulations regarding foreign currency exchange in a bid to curb ongoing dollar shortages in the Maldives.
Ministers agreed to expedite measures to ease the difficulties faced by the Maldivian population due to the ongoing shortage.
During Tuesday’s cabinet meeting ministers also approved the Maldives’ participation in the International Anti-Corruption Academy (IACA).
IACA is a joint initiative by the United National Office on Drugs and Crime, Austria, European Anti-Fraud Office and other stakeholders. IACA aims to overcome current shortcomings in knowledge and practice in the field of anti-corruption.
In a statement the President’s Office said that the Maldives’ participation in IACA would be “a huge step forward in its fight against corruption.”
Singaporean police are reportedly investigating former President Maumoon Abdul Gayoom’s half brother Abdulla Yameen for alleged involvement in an international money laundering racket thought to be worth up to US$800 million – if accurate, a staggering 80 percent of the Maldives’ annual GDP.
Yameen is an MP and leader of the People’s Alliance (PA) party, which in coalition with the opposition Dhivehi Rayyithunge Party (DRP), of which Gayoom is the ‘honorary leader’, together maintain a parliamentary majority in the Maldives.
The allegation is central to an explosive piece in India’s The Week magazine by Sumon K Chakrabarti, Chief National Correspondent of CNN-IBN, who describes Yameen as “the kingpin” of a scheme to buy subsidised oil through the State Trading Organisation’s branch in Singapore and sell it on through an entity called ‘Mocom Trading’ to the Burmese military junta, at a black market premium.
“The Maldives receives subsidised oil from OPEC nations, thanks to its 100 percent Sunni Muslim population. The Gayooms bought oil, saying it was for the Maldives, and sold it to Myanmar on the international black market. As Myanmar is facing international sanctions, the junta secretly sold the Burmese and ‘Maldivian’ oil to certain Asian countries, including a wannabe superpower,” alleged Chakrabarti, who is writing a book on Gayoom’s administration and the democracy movement that led to its fall.
“Sources in the Singapore Police said their investigation has confirmed ‘shipping fraud through the diversion of chartered vessels where oil cargo intended for the Maldives was sold on the black market creating a super profit for many years,’” the report added.
Referencing an unnamed Maldivian cabinet Minister, The Week states that: “what is becoming clear is that oil tankers regularly left Singapore for the Maldives, but never arrived here.”
The article draws heavily on an investigation report by international accountancy firm Grant Thorton, commissioned by the Maldives government in March 2010, which obtained three hard drives containing financial information detailing transactions from 2002 to 2008. No digital data was available before 2002, and the paper trail “was hazy”.
According to The Week, Grant Thorton’s report identifies Myanmar businessman and head of the Kanbawza Bank and Kanbawza Football Club, Aung Ko Win, as the middleman acting between the Maldivian connection and Vice-Senior General Maung Aye, the second highest-ranking member of the Burmese junta – one of the world’s most oppressive regimes, perhaps exceeded only by North Korea.
Also allegedly implicated in the Grant Thorton report are Brigader-General Lun Thi, the junta’s Minister of Energy, Aung Thaung, the Burmese Minister of industry, “and his son, Major Pye Aung, who is married to Aye’s daughter, Nander Aye.”
“Another Burmese business couple, Tun Myint Naing (aka ‘Steven Law’) and his wife, were linked to the Gayooms,” alleged The Week.
According to a 2000 report on the Golden Triangle Opium trade by Hong Kong-based regional security analysis firm, Asia Pacific Media Services, “in 1996 Steven Law was refused a visa to the USA on suspicion of involvement in narcotics trafficking”, and several companies linked to him were blacklisted because of his suspected involvement in his father’s drug empire.
His father, Lo Hsing Han, also known as Law Sit Han, is named in the report as a notorious ‘Golden Triangle’ heroin baron turned businessman, with financial ties to Singapore. He was also responsible responsible for arranging a lavish wedding in 2006 for the daughter of Burmese dictator Than Shwe.
“Lo Hsing-han and his family set up the Asia World Company… involved in import-export business, bus transport, housing and hotel construction, a supermarket chain, and Rangoon’s port development,” APMS wrote.
According to The Week report, “Yameen was allegedly aided by Ahmed Muneez, former Managing Director of STO Singapore, and by Mohamed Hussain Maniku, former MD, STO. Maniku was MD from 1993 to 2008, and currently serves as the Maldives’ Ambassador to Washington.
The operation
According to The Week article, the engine of the operation was the Singaporean branch of the government-owned State Trading Organisation (STO), of which Yameen was the board chairman until 2005.
Fuel was purchased by STO Singapore from companies including Shell Eastern Petroleum Pvt Ltd, Singapore Petroleum company and Petronas, and sold mostly to the STO (for Maldivian consumption) and Myanmar, “except in 2002, when the bulk of the revenue came from Malaysia.”
The “first red flag” appeared in an audit report on the STO by KPMG, one of the four major international auditing firms which took over the STO’s audits in 2004 from Price WaterhouseCoopers.
The firm noted: “A company incorporated in Singapore by the name of Mocom Trading Pte Ltd in 2004 has not been discluded under Note No. 30 to the Financial Statements. There was no evidence available with regard to approval of the incorporation. Further, we are unable to establish the volume and the nature of the company with the group.”
In a subsequent report, KMPG noted: “The name of the company has been struck off on 20th April 2006.”
Investigators learned that Mocom Trading was set up in February 2004 as a joint venture between STO Singapore and a Malaysian company called ‘Mocom Corporation Sdn Bhd’, with the purpose of selling oil to Myanmar and an authorised capital of US$1 million.
According to The Week, the company had four shareholders: Kamal Bin Rashid, a Burmese national, two Maldivians: Fathimath Ashan and Sana Mansoor, and a Malaysian man named Raja Abdul Rashid Bin Raja Badiozaman. Badiozaman was the Chief of Intelligence for the Malaysian armed forces for seven years and a 34 year veteran of the military, prior to his retirement in 1995 at the rank of Lieutenant General.
As well as the four shareholders, former Managing Director of STO Singapore Ahmed Muneez served as director. The Week reported that Muneez informed investigators that Mocom Corportation was one of four companies with a tender to sell oil to the Burmese junta, alongside Daewoo, Petrocom Energy and Hyandai.
Under the contract, wrote The Week, “STO Singapore was to supply Mocom Trading with diesel. But since Mocom Corporation held the original contact, the company was entitled to commission of nearly 40 percent of the profits.”
That commission was to be deposited in an United Overseas Bank account in Singapore, “a US dollar account held solely by Rashid. So, the books would show that the commission was being paid to Mocom, but Rashid would pocket it.”
In a second example cited by The Week, investigators discovered that “STO Singapore and Mocom Trading duplicated sales invoices to Myanmar. The invoices showed the number of barrels delivered and the unit price. Both sets of invoices were identical, except for the price per barrel. The unit price on the STO Singapore invoices was US$5 more than the unit price of the Mocom Trading invoice. This was done to confuse auditors.”
As a result, “the sum total of all Mocom Trading invoices to Myanmar Petrochemical Enterprises was US$45,751,423, while the sum total of the invoices raised by STO Singapore was US$51,423,523 – a difference of US$5,672,100.”
Furthermore, “investigators found instances where bills of lading (indicating receipt of consignment) were unsigned by the ship’s master.”
Gayoom's half-brother and PA leader Abdulla Yameen
Money from the Maldives
Despite his officially stepping down from the STO in 2005, The Week referenced the report as saying that debit notes in Singapore “show payments made on account of Yameen in 2007 and 2008.”
Citing the report directly, The Week wrote: “The debit notes were created as a result of receiving funds from Mr Yameen deposited at the STO head office, which were then transferred to STO Singapore’s bank accounts. This corresponded with a document received from STO head office confirming the payments were deposited by Yameen into STO’s bank accounts via cheque.
The Week claimed that Yameen was aided by Muneez on the STO Singapore side, and by Mohamed Hussain Maniku, former STO managing director, on the Maldivian end until 2008.
“In conversation with Mr Muneez, this was to provide monies for the living expenses of his [Yameen’s] son and daughter, both studying in Singapore. Their living expenses were distributed by Mr Muneez,” the Grant Thorton report stated, according to The Week.
In an interview with Minivan News, Yameen confirmed that he had used the STO’s accounts to send money to his children in Singapore, “and I have all the receipts.”
He described the then STO head in Singapore as “a personal friend”, and said “I always paid the STO in advance. It was a legitimate way of avoiding foreign exchange [fees]. The STO was not lending me money.”
He denied sending money following his departure from the organisation: “After I left, I did not do it. In fact I did not do it 3 to4 years before leaving the STO. I used telegraphic transfer.”
Yameen described the wider allegations contained in The Week article as “absolute rubbish”, and denied being under investigation by the Singaporean police saying that he had friends in Singapore who would have informed him if that were the case.
The article, he said, was part of a smear campaign orchestrated by current President of the Maldives Mohamed Nasheed, a freelance writer and the dismissed Auditor General “now in London”, who he claimed had hired the audit team – “they spent two weeks in the STO in Singapore conducting an investigation.”
Yameen said he did not have a hand in any of the STO’s operations in Singapore, and that if Muneez was managing director at the time of any alleged wrong-doing, “any allegations should carry his name.”
He denied any knowledge or affiliation with Steven Law or Lo Hsing Han, and said that as for Mocom Trading, “if that company is registered, Maniku would know about it.”
Asked to confirm whether the STO Singapore had been supplying fuel to Myanmar during his time as chair of the board, “it could have been – Myanmar, Vietnam, the STO is an entrepreneurial trade organisation. It trades [commodities like] oil, cement, sugar, rice to places in need. It’s perfectly legitimate. “
Asked whether it was appropriate to trade goods to a country ostracised by the international community, Yameen observed that the trading had “nothing to do with the moral high-ground, at least at that time. Even even now the STO buys from one country and sells to those in need.”
Asked why the President would hire a freelance writer to smear his reputation after the local council elections, “that’s because Nasheed would like to hold me in captivity.”
The only way Nasheed could exert political control, Yameen claimed, “was to resort to this kind of political blackmail”.
“Unfortunately he has not been able to do that with me. I was a perfectly clean minister while in Gayoom’s cabinet. They have nothing on me.”
Last time around
No love is lost between Yameen and the present Maldivian administration, which detained him and Jumhoree Party (JP) leader Gasim Ibrahim in early July 2010 on accusations of bribery and, according to the police charge sheet, “attempting to topple the government illegally.”
President Nasheed’s cabinet had resigned en masse the week prior, in protest against what they claimed were the “scorched earth politics” of the opposition-majority parliament, leaving only President Mohamed Nasheed and Vice President Mohamed Waheed Hassan in charge of the country. The move circumvented regulations blocking the arrest of MPs while no-confidence motions were pending against sitting ministers.
Several days later, audio recordings of conversations between several MPs, including Yameen and Gasim, were leaked to the media. The recordings carried implications of vote-buying within parliament, suggestions of collaboration with the officials in the Anti-Corruption Commission (ACC), and details of a plan to derail the progress of a taxation bill.
Yameen defended the conversation at the time as “not to borrow money to bribe MPs… [rather] As friends, we might help each other.”
The issue quickly became one of invasion of privacy, and the Human Rights Commission of the Maldives (HRCM) issued a statement to that effect.
Unable to get an arrest warrant extension for the pair through the Maldivian courts, the government quickly found itself facing international criticism and diplomatic urging to “stick to the rule of law”, after Yameen was detained by the military on the Presidential Retreat of Aarah purportedly “for his own protection.”
While in custody, Yameen told local media he did not wish to be detained in ‘protective’ custody. The military refused to present him before the court on a court order, raising more international eyebrows.
Later in July, the President’s Press Secretary Mohamed Zuhair told Minivan News that the government had felt obliged to take action after six MDP MPs came forward with statements alleging Yameen and Gasim had attempted to bribe them to vote against the government.
The opposition PA-DRP coalition already has a small voting majority, with the addition of supportive independent MPs. However, certain votes require a two-thirds majority of the 77 member chamber – such as a no-confidence motion to impeach the president.
Zuhair told Minivan News at the time that given the severity of the allegations against them, neither could be considered prisoners of conscience.
“I cannot describe these people as political leaders – they are accused of high crimes and plots against the state,” Zuhair said.
“These MPs are two individuals of high net worth – tycoons with vested interests,” he explained. “In pursuing their business interests they became enormously rich during the previous regime, and now they are trying to use their ill-gotten gains to bribe members in the Majlis [parliament] and judiciary to keep themselves in power and above the fray.”
“They were up to all sorts of dark and evil schemes,” Zuhair alleged. “There were plans afoot to topple the government illegally before the interim period was over.”
Yameen was also one of many former and serving Ministers on an audit hit-list issued by Auditor General Ibrahim Naeem, prior to his dismissal on March 29, 2010.
Naeem, who was appointed by former President Gayoom, had produced a damning report detailing the previous government’s spending habits. These, according to an article on the report published in the New York Times, included an estimated “US$9.5 million spent buying and delivering a luxury yacht from Germany for the president, $17 million on renovations of the presidential palace and family houses,a saltwater swimming pool, badminton court, gymnasium, 11 speed boats and 55 cars, including the country’s only Mercedes-Benz.”
“And the list goes on, from Loro Piana suits and trousers to watches and hefty bills for medical services in Singapore for ‘important people and their families. There was a US$70,000 trip to Dubai by the first lady in 2007, a US$20,000 bill for a member of the family of the former president to stay a week at the Grand Hyatt in Singapore. On one occasion, diapers were sent to the islands by airfreight from Britain for Mr Gayoom’s grandson,” wrote the NYT, citing Naeem’s report.
The Maldives government had “begun the paper chase”, the NYT report claimed, “but it lacks the resources to unravel a complex trail that it assumes runs through the British Channel Islands, Singapore and Malaysia.”
On March 24, Naeem sent a list of current and former government ministers to the Prosecutor General, requesting they be prosecuted for failure to declare their assets, citing Article 138 of the Constitution requiring every member of the Cabinet to “annually submit to the Auditor General a statement of all property and monies owned by him, business interests and all assets and liabilities.”
He then held a press conference: “A lot of the government’s money was taken through corrupt [means] and saved in the banks of England, Switzerland, Singapore and Malaysia,” Naeem said, during his first press appearance in eight months.
Five days later he was dismissed by the opposition-majority parliament on allegations of corruption by the Anti-Corruption Commission (ACC), for purportedly using the government’s money to buy a tie and visit Thulhaidhu in Baa Atoll. The motion to dismiss Naeem was put forward by the parliamentary finance committee, chaired by Deputy Speaker and member of Yameen’s PA party Ahmed Nazim, who the previous week had pleaded not guilty to ACC charges of conspiracy to defraud the former ministry of atolls development while he was Managing Director of Namira Engineering and Trading Pvt Ltd.
The parliament has yet to approve a replacement auditor general.
Representatives of the former government have steadfastly denied the existence of stolen funds. Gayoom’s assistant and former chief government spokesperson Mohamed Hussain ‘Mundhu’ Shareef told Minivan News in December 2009 that ”there is no evidence to link Gayoom to corruption”, and urged accusers “to show us the evidence.”
“If you have the details make them public, instead of repeating allegations,” he said at the time. “[Gayoom] has said, ‘go ahead and take a look, and if you find anything make it public.’”
Shareef had not responded to Minivan News at the time of going to press.
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