Graft And The Central Bank

This weekend’s news about the arrest and charging of an ex-assistant governor of BNM is sad news for Malaysia’s institutional development (excerpt):

Ex-BNM assistant governor charged

KUALA LUMPUR: Former Bank Negara assistant governor Datuk Mohamad Daud Dol Moin, 58, has claimed trial at a Sessions Court here to two counts of accepting bribes amounting to RM100,000 from a businessman to help procure a contract from the central bank.

The contract was to print RM5 polymer bank notes by Note Printing Australia Ltd.

Dressed in a dark suit, he calmly pleaded not guilty when the charges were read out to him at about 11am yesterday.

He was accused of receiving two bribes of RM50,000 from Abdul Kayum Syed Ahmad at Dome Restaurant, Bangsar Shopping Centre, on Dec 1, 2004, and Feb 16, 2005.

If convicted under Section 11(a) of the Malaysian Anti-Corruption Commission Act, he can be jailed up to 20 years and fined five times the bribe amount, for each charge.

As I recall, the last time someone that high up in the central bank was charged with abusing his position was the case of former Assistant Governor Datuk Abdul Murad Khalid back in the late 1990s, which turned into a political circus involving Anwar Ibrahim.

Be that as it may, this case is more straightforward and for that very reason more discouraging. We are after all talking about alleged corruption pure and simple. That it involves subsidiaries of the Reserve Bank of Australia, as well as two other regional central banks is beside the point.

About the only saving grace here is that the MACC hasn’t hesitated in charging a senior official, though given that BNM is populated by technocrats rather than politicians and the international dimensions of the case, it isn’t much of one.

A black mark for BNM, and a setback for the credibility of its internal controls.