The Securities Commission (SC) today slapped an RM2.2 million fine on audit firm Deloitte following an investigation over its alleged involvement in the 1MDB scandal.
In a statement, the commission said this was for four breaches related to the RM2.4 billion Sukuk Murabahah Programme issued by Bandar Malaysia Sdn Bhd (BMSB) in 2014.
“Deloitte was found to have committed two breaches under Section 276(3)(b) of the Capital Markets and Services Act 2007 (CMSA) for failure to immediately report irregularities which might affect Bandar Malaysia’s ability to fulfil its obligations to repay sukuk-holders any amount under its Sukuk Murabahah Programme,” it said.
These breaches saw Deloitte fined RM2 million, the maximum amount provided for under Section 354(3)(b) of the CMSA.
The remaining two breaches were under Section 276(1) of the CMSA, for which Deloitte was fined RM200,000.
Deloitte was the statutory auditor for BMSB and 1MDB Real Estate Sdn Bhd (1MDB RE) for their financial years ended March 31, 2015, to 2016.
1MDB RE, now known as TRX City Sdn Bhd, was one of the third-party security providers of the Sukuk Murabahah Programme and the immediate holding company of BMSB.
1Malaysia Development Bhd (1MDB) was the holding company of 1MDB RE and BMSB.
Last week, the SC confirmed that it was investigating auditors of 1MDB, which included Deloitte.
It was reported that SC was assessing if auditors were “aiding and abetting in the 1MDB scandal or merely negligent”.
Earlier report: Jan 26, Report: Securities Commission Probing Audit Giants KPMG, Deloitte over 1MDB