The proposed P275-billion Maharlika Wealth Fund (MWF) has enough safeguards in it to prevent its embezzlement a la the 2016 1Malaysia Development Berhad scandal or 1MDB scandal in Malaysia.
Albay 2nd district Rep. Joey Salceda made this assurance Friday, Dec. 2, a day after House Bill (HB) No.6398 or the proposed Maharlika Wealth Fund Act was approved at the committee level.
"I think there are enough safeguards against any 1MDB scenario for the Maharlika Investment Fund," said Salceda, vice chairman of the House Committee on Banks and Financial Intermediaries, which approved the measure.
"The Maharlika fund has several layers of accountability from the board of directors, the advisory board, the risk management unit and congressional ," said the Bicolano, who, in hia capacity as technical working group (TWG) chairman, was in charge of making amendments to the bill as filed.
"The President is the chairman of the board unlike in Malaysia, you know, na itinago nila sa ilalim (which hid that detail)," he said.
Salceda was referring to the 1MDB scandal, which also concerned a sovereign wealth fund.
The P275-billion MWF, which has been described as priority of President Ferdinand "Bongbong" Marcos Jr., is basically a sovereign wealth fund.
Described as "one of the world's greatest financial scandals", the 1MDB scandal was a corruption, bribery and money laundering conspiracy wherein the Malaysian sovereign wealth fund (1MDB) was systematically embezzled, with assets diverted globally by the perpetrators of the scheme.
It involved political, banking and entertainment figures and institutions and led to criminal investigations in several countries.
Salceda also dispelled the notion that there's a conflict of interest if Marcos sits as chairman of the board of directors of the proposed MWF.
"I don't see because the President is the head of NEDA (National Economic and Development Authority). He's in charge of the whole country actually. He's the chief executive," he said.
Reading from the committee-approved version of the bill, Salceda said: "The President shall sit as the chairperson; the head of the GFI (government financial institutions) with the most capital would need the vice chair; the rest shall sit as regular members in accordance with their corresponding shares or equity investment."
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He added that the board will have three independent directors: "One from the private sector, one from the academe, and one possibly from...people’s organization, for example."
The purpose of the MWF is to act as seed money for investments here and/or abroad. The profit that it makes from these investments would be used to fund big ticket projects geared toward national development. Salceda had identified such projects as "critical infrastructure" like dams and energy projects.
“The President’s expressed aspiration is for the to contribute to nation-building. The fund will pool resources towards that direction, since many of these projects are capital-intensive," he said on Thursday.
The proposed MWF Act was principally authored by House Speaker Martin Romualdez, Marcos’s top ally in the legislature.