Eyeing issues on 1MDB Malaysia episode 1

The Third Force

A little over a week ago, my team uncovered a pact of sorts that former US vice president Albert Arnold Al Gore had once entered with George Soros, the ever so notorious Hungarian-American billionaire-magnate. There seems to be legitimate proof that the duo was on a secret mission to restructure the East Asian economy and political landscape.

Sometime in January of 1997, Gore got in touch with Soros, who had then just established an international syndicate dedicated to the cause of effecting a regime change in Malaysia and Indonesia. Associates and members of the syndicate were promised payoffs, ranging from potential trade agreements to the indirect control of financial institutions within the Southeast Asian region.

Tony Blair was an accomplice, as was former US ambassador to Malaysia, John R. Malott (19th December 1995 – 30th December 1998). Blair, then the leader of the British opposition, was busy prepping his Labour Party for the general elections, which was then anticipated to be around the corner. At the time, Malott was already in close liaison with the then Malaysian Minister of Finance (MoF), Dato’ Seri Anwar Ibrahim.

Both Malott and Anwar were busy plotting a coup attempt against Dr. Mahathir Mohammad, then the Prime Minister of Malaysia, together with Tong Kooi Ong and the then governor of Bank Negara Malaysia (BNM), Tan Sri Dato’ Ahmad bin Mohd Don. But Mahathir had long before known of the plot.

As early as December of 1994, several BNM insiders allied to Tun Daim Zainuddin told the latter of discussions that were then ongoing between Anwar and Ahmad. According to them, both Anwar and Ahmad were planning to put a blot on Mahathir’s leadership in ways they were not yet sure of. Daim wasted no time in getting word of the alleged conspiracy to Mahathir.

But it was not until the following year that Mahathir took Daim seriously. Some time in March of 1995, Daim told the former premier that Lim Thian Kiat (LTK) was an Anwar accomplice and had in his team directors of several corporations that were linked to the Multi-Purpose Holdings Berhad (MPHB), then run by LTK as a co-operative godfather-led investment vehicle for Chinese businesses. Of course, this meant that the cash-rich Chinese elites helping UMNO fund its electoral campaigns were pandering to Anwar.

Mahathir didn’t like what he was hearing. So he got his sleuths from outside UMNO to do their own digging. Months later, they returned with tidings that almost gave the former premier a heart attack. Mahathir was told that his sons may be in trouble, that Anwar and Ahmad had engaged the help of certain quarters from abroad and the central bank to sniff them out.

Mahathir quickly put his sons – Dato’ Mokhzani Mahathir, then the Chairman of Tongkah Holdings Berhad, and Mirzan Mahathir, the then President and Chairman of Konsortium Logistik Berhad – on red alert. When the former premier related to his wife what he had been told, she wept and begged him not to let Anwar get her sons.

It was decided. Anwar needed to go.

The very next day, the former premier engaged the services of his sleuths, this time from both UMNO and outside the party, to dig into every aspect of Anwar’s associations with the corporate world both local and foreign. By then, the former premier had come to know of Anwar’s sexual preferences through a Special Branch officer (who I will talk of later) and several UMNO insiders. Mahathir was even said to have been presented with a list of Anwar’s favoured ‘victims’.

Mahathir’s sleuths were told to dig deeper into Anwar’s affairs and to keep digging until they knew every ounce of the latter’s weakness that would imply criminal wrongdoing. Months later, his sleuths returned with volumes and volumes of ‘filth’, most of which pertained to homosexual activity, criminal malfeasance and corporate misgivings. By December of 1996, Mahathir told Daim in the presence of a third party that “Anwar needs to go.” But little did they know that the ‘witness’ went running to Anwar and triggered the alarm.

Yes, at this juncture, I am sure both Mahathir and Daim will immediately realise how Anwar got to know of that ‘secret little meeting’ they had and why the sacked deputy premier exacted revenge on Mirzan Mahathir during the height of the Asian Financial Crisis. And I am quite positive that this article will open Mahathir’s eyes to the fact that he now has in his team a double-headed snake, one he never once thought would double-cross him.

Back to the story – upon learning of Mahathir’s intentions, Anwar quickly got in touch with Malott, who then told Soros that their cover had been blown, that Mahathir was closing in on Anwar. Soros was very disheartened by the news, as things weren’t going smoothly in Indonesia either. Gore’s people suffered major setbacks in triggering a Suharto ouster. Soros decided that the Asian economy needed to be brought down as one way to weaken Suharto’s and Mahathir’s grip of the Malay Archipelago.

Early in January 1997, Soros instructed his associates at the Quantum Fund, a hedge fund he founded in the 70’s together with Jim Rogers, to double its stock of the Thai Baht. One version has it that Soros got in touch with Tony Blair and the then Managing Director of Merrill Lynch, Britt Bartter, right after he decided on the establishment of the syndicate I spoke of earlier, the one dedicated to ousting Mahathir and Suharto.

According to this version, both Blair and Soros discussed the then upcoming British elections, which the former knew had to be called before the 22nd of May 1997. Soros, whose hedge fund was snapping up the Thai Baht as if it were plain paper, agreed to allay bets against the Thai currency pending the British electoral outcome. By mid of January 1997, Soros had his syndicate structured and ready to move.

Incidentally, Paul Wolfowitz (World Bank President, 1st of June 2005 – 1st of July 2007) and Dick Cheney (US vice president, 20th January 2001 – 20th January 2009) were two names that topped an auxiliary list of financiers involved with the syndicate. The list bore references to some notable institutions, among them being the Washington based Heritage Foundation, the Soros-financed International Crisis Group (ICG) and the Cheney-run Foundation for the Future. The names of some distinguished leaders, diplomats and ambassadors appeared on this list as well.

Soros injected funds that he had once looted from the Bank of England into the syndicate’s coffers. On the 16th of September 1992, a decision by the billionaire’s fund to sell short 10 million dollar worth of British pounds registered as a 3.2 billion pound loss that almost bankrupted the United Kingdom (UK). That day went down in history as “black Wednesday,” or the day Soros “broke the Bank of England.”

Note that the 16th of September 1992 was a Wednesday, as was the 2nd of July 1997, the day Soros broke the Central Bank of Thailand. On that day, the bank was forced to devalue the Thai Baht by as much as a record 20 percent owing to speculative attacks against the currency beginning the 14th of May 1997, also a Wednesday. Were these mere coincidences?

Anyway, Anwar was informed by Malott as early as February of 1997 that Soros and his team had been stockpiling on the Thai Baht, that they were confident the Central Bank of Thailand did not possess the reserves to defend the Baht from collapsing. The Baht was buoyed artificially against weak fundamentals amid a fixed exchange rate system. Soros rode on that system by borrowing massive sums of the Baht and converting it to the dollar at a fixed rate.

Malott told Anwar that Soros was confident the Bank of Thailand would run out of its dollar reserves before May. A month later, Ahmad (BNM governor) informed Anwar of the record earnings that Soros’ fund was posting from the buying and selling of regional currencies. But both Anwar and Ahmad decided against triggering alarm or making mention of an impending crisis to Mahathir or Daim.

But unbeknown to Anwar, Daim had his sleuths planted in BNM since his days as Minister of Finance. Daim, who himself had a vested interest in the regional banking scene, made a dash to Mahathir’s office and notified the Prime Minister in March of Anwar’s complicity with Soros to trigger a regional financial crisis. Thunderstruck, Mahathir started making arrangements to bring Daim back into active politics.

But it was too late.

On the 2nd of May 1997, Blair’s Labour Party swept the election to make him the second youngest person to take office as Prime Minister of the United Kingdom (UK). A little over a week later, Soros got his fund to bet just under one billion of his twelve billion dollar war chest against the Thai Baht, knowing well in advance that the Bank of Thailand was almost dry of foreign reserves.

His decision cost the Bank of Thailand billions in foreign reserves as it tried desperately to defend the Baht. A decision by the Central Bank of Thailand to devalue its currency on the 2nd of July 1997 triggered panic responses as currency traders jettisoned the ringgit and Indonesian rupiah as if it were a sack of rotten potatoes. Soros had succeeded – the Asian Financial Crisis was triggered.

The thing is, Anwar had known months ahead that a financial crisis would strike the region. He knew that the Quantum Fund would place a speculative bet against the Thai Baht in a bid to cripple the Asian economy. But he went along with the plan, as he had been instructed by the new Managing Director of the International Monetary Fund (IMF), Michel Camdessus, to keep his mouth shut and to do as he was told.

Anwar had no choice but to abide by Camdessus’ directive, as the syndicate Soros had established was channelling massive amounts of funds to Anwar through third party channels based in Thailand, Indonesia and India. And it is not as if Anwar wanted to go against the directive. In the first place, it was he who made clear to Soros, Malott and Camdessus that he wanted Mahathir toppled “at all cost.”