SCwatch


MALAYSIAN FINANCIAL SCANDALS (of late) – “SUGAR COATED” CONMEN?
When we read about high profile corporate scandals, it immediately brings to mind the Enrons, Worldcoms, Parmalats and Tycos. The commonality amongst these companies is that they were personality driven …. by Ken Lay, Bernie Ebbers, Calisto Tanzi and Dennis Kozlowski respectively.
There was therefore hardly any check and balance that prevailed in these companies and (if I could partially quote a recent Alan Greenspan observation) the employees’, directors’, auditors’ and creditors’ belief in the wisdom of these CEOs were infinite!
The more recent fall-out amongst the investment bankers (currently a defunct term) and now fund manager, Bernard Madoff seem to suggest that things have not changed much.
A well known financial daily that reported on the US$50 billion loss arising from Bernard Madoff’s ponzi scheme described him as follows:-  

“Bernard Madoff attained fame and fortune with his connections, ingenious marketing and a carefully cultivated image”

Doesn’t this description also fit many of our Malaysian CEOs of failed entities? These are also indicators of looming failures of Malaysian companies with CEOs of these characteristics!!
These CEOs will hide behind every facade of illusion to portray a sense of well-being, wisdom, courage, perseverance, philanthropy, passion, belief etc. They will also arrange for themselves to be awarded with all kinds of awards to elicit further this sense of “awe” from the people at large e.g. Global Brand Person of the Year, Tourism Personality of the Year, Global Green Product Design Award, Major Brand Award etc.
This immediately brings to mind the famous quote:

“You can fool all the people some of the time and some of the people all the time BUT you can’t fool all the people all the time”

Technology has to a large degree enabled many people now to see through the antics of these “Smooth Characters” in order to make their own assessment and decision.
Alas, there are still the many who just do not want to see it as it is ….. why should they, they ask? They are reaping the benefits like “Everyone can Drive”, “Everyone can Fly!’ etc. and they will bugger the rest!!
This is where responsible government comes into play. The government is the custodian of the people’s money and disbursements should not be made at their whims and fancies and certainly not to be used in order to play to the gallery!
Of course, we must give credit to some of these entrepreneurs who have built companies out of scratch ….. some to the extent of making them world famous brands ….. that we see such brands not only at airports but even at Premier League football games!
It becomes a problem when ego comes into play …. to the extent that one keeps emphasising that his surname ends with an “S”, not a “Z”, the latter of which somehow is perceived to being Indian!! It gets worse when things do not actually look as good as what had been portrayed earlier ….. then window dressing is adopted, the extreme case may be down right fraud when things become desperate. 
And these things occur during a down-turn …. “it is only when the tide is low that we can see who is swimming naked!” ….. does that explain why some people are regularly in the news announcing one deal after another, only to say later it cannot take place due to unacceptable terms …. ?
When we find out that EPF’s earnings are down 60% from RM6.5 billion to RM2.6 billion, we do wonder how much of those “opportunity costs” are due to the propping up of counters in the name of national interests!
Yes, Wee Choo Keong (MP for Wangsa Maju) has stated that as long as the tax-payers’ monies are not used to bail out companies, he has no issue with them (see here). But what if it is done indirectly? Choo Keong has his work cut out for him ….. luckily we have one of the most hard-working MPs looking into such matters!
I believe that Malaysiakini, which has been doing a wonderful job reporting objectively on the Malaysian political scene, should expand their investigative reporting repertoire to the Malaysian corporate scene. This would provide balance to the kind of advertisements that Ahirudin Attan of Rocky’s Bru gives to “corporate captains” (for example, see here and here) for being champions of change, for being Malaysian and all those kinds of rhetoric!
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