Embezzlement case shakes Myanmar, former gov’t in focus

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Dollar tunnelAn embezzlement probe has been launched by Myanmar’s Department of Mines after almost $100 million vanished from a joint fund set up by Myanmar’s gem companies.

According to the association, the fund contained over $103 million, but it has been largely drained and now contains just $7.8 million, according to U Win Htein, director general of the Department of Mines.

The fund, filled by funds drawn from a one-per cent levy on profits from the multi-billion-dollar trade with jade, sapphires and rubies, was set up to help develop local gem markets and associations. But due to a lack of transparency under the old government of President Thein Sein in terms of the fund’s management, it is hard to track what actually happened to the money, Kyaw Kyaw Oo, member of the Myanmar Gems and Jewellery Entrepreneurs Association told reporters at a news conference in Yangon on June 2. The association lodged a complaint over the alleged embezzlement.

But it is not even clear who owns the fund. The Department of Mines, part of the Ministry of Natural Resources, is of the opinion that the fund belongs to the Myanmar Gems Emporium Central Committee since 2006 and is not connected with the Myanmar Gems and Jewellery Entrepreneurs Association.

Kyaw Kyaw Oo said that it seems that part of the funds have been “gifted” to certain unnamed persons, but there was no written proof for it.

“What is know is that a large amount of money was taken, and we need to know exactly what happened,” he said.

His statement raises corruption fears in an industry notorious for its opaque dealings. The gem business has always been firmly in the hands of the Myanmar military and its cronies during the junta rule, and it remained in secrecy despite reforms under the quasi-civilian government of Thein Sein that came to power in 2011.

Last year, corruption watchdog Global Witness called Myanmar’s jade industry an “illicit $31-billion industry, with most profits going to powerful military and ex-junta figures instead of the state coffers.

Large amounts of the money is being sent overseas, namely to trade companies incorporated in Singapore and Hong Kong, and from there “re-invested” in the country, which partly explains the huge foreign direct investment inflows into Myanmar.

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An embezzlement probe has been launched by Myanmar's Department of Mines after almost $100 million vanished from a joint fund set up by Myanmar's gem companies. According to the association, the fund contained over $103 million, but it has been largely drained and now contains just $7.8 million, according to U Win Htein, director general of the Department of Mines. The fund, filled by funds drawn from a one-per cent levy on profits from the multi-billion-dollar trade with jade, sapphires and rubies, was set up to help develop local gem markets and associations. But due to a lack of transparency under...

Reading Time: 2 minutes

Dollar tunnelAn embezzlement probe has been launched by Myanmar’s Department of Mines after almost $100 million vanished from a joint fund set up by Myanmar’s gem companies.

According to the association, the fund contained over $103 million, but it has been largely drained and now contains just $7.8 million, according to U Win Htein, director general of the Department of Mines.

The fund, filled by funds drawn from a one-per cent levy on profits from the multi-billion-dollar trade with jade, sapphires and rubies, was set up to help develop local gem markets and associations. But due to a lack of transparency under the old government of President Thein Sein in terms of the fund’s management, it is hard to track what actually happened to the money, Kyaw Kyaw Oo, member of the Myanmar Gems and Jewellery Entrepreneurs Association told reporters at a news conference in Yangon on June 2. The association lodged a complaint over the alleged embezzlement.

But it is not even clear who owns the fund. The Department of Mines, part of the Ministry of Natural Resources, is of the opinion that the fund belongs to the Myanmar Gems Emporium Central Committee since 2006 and is not connected with the Myanmar Gems and Jewellery Entrepreneurs Association.

Kyaw Kyaw Oo said that it seems that part of the funds have been “gifted” to certain unnamed persons, but there was no written proof for it.

“What is know is that a large amount of money was taken, and we need to know exactly what happened,” he said.

His statement raises corruption fears in an industry notorious for its opaque dealings. The gem business has always been firmly in the hands of the Myanmar military and its cronies during the junta rule, and it remained in secrecy despite reforms under the quasi-civilian government of Thein Sein that came to power in 2011.

Last year, corruption watchdog Global Witness called Myanmar’s jade industry an “illicit $31-billion industry, with most profits going to powerful military and ex-junta figures instead of the state coffers.

Large amounts of the money is being sent overseas, namely to trade companies incorporated in Singapore and Hong Kong, and from there “re-invested” in the country, which partly explains the huge foreign direct investment inflows into Myanmar.

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