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MAY 14 '92 19:27 CLIFFORD CHANCE HK 852 8104708
P.7
6
CORRUPT PAYMENTS AND MISUSE OF BANK FUNDS
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Saniman along with his fellow directors LEO and DHS is furthermore accused of accepting bribes and favours from George Tan for his part in arranging and carrying out the fraudulent diversion of funds.
Saniman is furthermore accused of fraudulently misusing bank funds for his own personal use by applying them as security for personal loans from other Institutions to himself. Such application of the bank's funds is in violation of his obligations as an officer and director.
DAMAGE AND LOSS
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The fraudulent advances and misuse of banks assets in the manner as set out caused great loss and prejudice to BMFL and BBMB in the amount of several hundred million US dollars.
The loss of approximately US$800 million was assigned by formal deed to BBMB. BBMB then in turn assigned by formal deed the loss to the National Oil Company in Malaysia, a major shareholder in the Bank. This was necessary so as to enable both BMFL and BBMB to avoid insolvency.
MECHANICS OF THE ADVANCES
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The fraudulent advance by BMFL to the Carrian group totalled five loan transactions in the amount of US$292 million, US$138 million, US$100 million, US$97 million and US$30 million respectively. For practical reasons considering that a bank cannot fully pay out such amounts at once, BMFL had to carry out a series of advances or drawdowns for each loan in accordance with international corresponding banking practice when financing the loans in foreign currency. Having regard to the contractual loan documentations, such that existed, and internal BMFL documents it is clear that there were five loans for the above mentioned amounts fully paid out in the form of numerous successive drawdowns.