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MyCreative Ventures found to have misallocated funds meant for MY creative industry

MyCreative Ventures (MyCV), an investment arm under Malaysia’s Ministry of Finance (MoF), was found to have invested RM214.24 million in funds allocated by the government in the money market, which is the trade in short-term debt investments. MyCreative Ventures aims to spur Malaysia’s creative industry via strategic and innovative funding through equity or debt investments.

According to the Auditor-General’s (AG) Report 2018 Series 1, the RM214.24 million allocated was meant for MyCV’s private debt and private equity programmes. The audit review found that only RM86.71 million (48.2%) of the RM180 million catered to private debt financing was handed out to 78 companies in the creative industry. The audited statements for the financial year 2016 to 2017 said that MyCV generated a revenue of RM6.22 million and RM6.50 million respectively from the money market investments. As for 2018, the rate of return amassed from the money market investments was between 3.25% to 3.70%, with returns amounting to RM7.67 million.

The AG’s report, however, said that checks made to the documents in the government’s investment division found no evidence of approval from MoF, adding that it is not in line with the terms set in the approval of provisions by the MoF. The private debt programme is a lender and stock investment programme for qualified companies in the creative industry, while the private equity programme is an equity investment to companies in Malaysia’s creative industry that are just starting up and have passed the due process diligence set by MyCV.

According to the report, the MoF circular states that all ministries, departments and agencies should ensure all government projects are implemented according to the scope, and that costs of projects approved by the MoF and the Economic Planning Unit (EPU) are in line with government guidelines.

“MOF and EPU also set requirements in the letter of approval issued that MyCV should apply prior approval for use other than original purpose or use of balance for other purposes,” the report said.

Recently, the AG’s report also found the Malaysian Communications and Multimedia Commission (MCMC) to have spent RM12.81 million between 2016 to 2018, with about RM4.8 million covering predictive analytics and big data analytics. Following the report, the Ministry of Communications and Multimedia said it will be filing a report with the Malaysian Anti-Corruption Commission over the abuse of MCMC funds.

(Photo courtesy: 123RF)

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