A TESTIMONY by former Bank Negara Malaysia (BNM) auditor Wong Yew San at the Royal Commission of Inquiry (RCI) today has contradicted claims by former BNM assistant governor Abdul Murad Khalid that no one looked into the forex losses.

Wong, 69, said the central bank has formed the External Reserve Committee (ERC) to monitor and regulate forex dealings.

However, in testimony later today, the six-member RCI panel, led by Petronas chairman Mohd Sidek Hassan, criticised former ERC secretary Essah Yusoff for failing to carry out extensive probes into the forex losses, alleged by Murad to be US$10 billion (then RM25 billion).

Wong, who worked at the central bank from 1971 to 2003, refuted a claim by Murad in an interview given to the New Straits Times in January that there was no committee to overlook forex transactions and that everything was done on an individual basis.

“There was a committee established to oversee forex activities,” Wong said, referring to the ERC.

“However, as to the limit of their oversight on management deals is not stated clearly,” Wong said, referring page 15 of the classified document ‘Audit Report on Foreign Exchange Operation Division of Banking Department and Processing Section of Accounts Department as at 31 December 1992 dated 21 January 1994.’

That report, classified under the Official Secrets Act (OSA), was prepared by BNM employees Ahmad Hizzad Baharuddin, who testified on Monday, and Ahmad Mudahir Omar.

They were assisted by three staffers from the Audit Department – Ong Book Teck, Zamrose Nasri Zainal and Ooi Kok Lye.

Referring to the same audit, Wong claimed forex losses suffered by BNM that year amounted to RM8.5 billion.

He added also that the management team of the central bank’s audit department was not told of forex trading activities by BNM.

He said dealers were limited to trading US$125 million, collectively, and as a group, they could decide themselves if they wanted to engage in trading or not.                

“(But) trading over this amount stated is left to the decision of the chief dealer and those above him,” Wong said.

“They could make a decision whether to undertake a dealing or not. For chief dealers and management deals, the limit allowed was not stated,” he added.

Wong’s claim that the dealer limit was set at US$125 million was contradicted by a claim later today by former BNM dealer Fizaman Noor Mohammad Nasir, who said limits by dealers were set at US$30 million. – August 24, 2017.