☕️ Massive "clean up" by MACC at the immigration department

1. MARKET SUMMARY 📈

The US central bank has cut interest rates for the first time in over four years, with a larger-than-normal reduction. The Federal Reserve lowered its main lending rate by 0.5 percentage points, bringing it to a range of 4.75%-5%. Jerome Powell, the bank's leader, said this strong action was necessary due to slowing price increases and growing worries about the job market. This cut was bigger than many experts expected a week ago, and the bank's predictions suggest rates might drop another 0.5 percentage points by the end of the year.

2. NUMBERS AT A GLANCE 🔢

Malaysia has surpassed Thailand to become the second-largest auto market in Southeast Asia, according to recent sales data for the April-June quarter. Led by national brands Perodua and Proton, Malaysia's vehicle sales increased by 8% year-on-year, totalling 184,702 units. The gap between Malaysia and Indonesia, the top market, has significantly narrowed, with just 8,134 vehicles separating them. This shift marks a significant change in the region’s automotive landscape. What is with Malaysian’s affinity for cars?

JPMorgan strategists warn that the ageing global population could negatively impact stock markets in the coming decades. Historically, a higher proportion of older individuals has led to lower stock returns, slower earnings growth, and weaker valuations. They estimate that a 1% increase in people over 65 correlates with a 0.92% drop in annual stock returns. An ageing population saves more for retirement, reducing investment capital and innovation, while a shrinking workforce further hampers earnings growth.

In the US, around 10,000 rear-end collisions occur daily, and despite advances in vehicle safety features, physics plays a dominant role in crash outcomes. Heavier vehicles, such as pickup trucks and SUVs, still fare better in crashes, with drivers of lighter cars being about three times more likely to die in collisions involving these vehicles. Although this is a slight improvement from 30 years ago, critics argue that the safety imbalance due to the popularity of larger vehicles is too high a price to pay for comfort and engine power. In 2014 Michael Anderson and Maximilian Auffhammer of the University of California, Berkeley estimated that when two cars crash, a 1,000lb increase in the weight of one vehicle raised the fatality rate in the other by 47%.

3. IN MALAYSIA 🇲🇾

MACC gets Mahathir’s sons to declare assets while still tracking Muhyiddin’s son-in-law
Adlan Berhan, son-in-law of former PM8 Muhyiddin Yassin, remains untraceable by the Malaysian Anti-Corruption Commission (MACC). MACC Chief Commissioner Azam Baki confirmed that efforts to locate him are ongoing, as several criminal breach of trust charges have been prepared against him. Adlan, alongside his lawyer Baljit Singh, has previously denied any intention to evade authorities, asserting that he is not a fugitive.

In contrast, the two sons of former PM Mahathir Mohamad, Mokhzani and Mirzan, have successfully declared their assets to the MACC. Azam Baki stated that both brothers submitted their declarations within the required timeframe and are currently finalising details with their lawyers. The MACC had initially instructed them to declare assets accumulated since 1981, coinciding with Dr Mahathir's first term as Prime Minister. The brothers had to utilise multiple extensions.

Something’s big brewing at the immigration department

1. Phone ban for KLIA immigration officers

   Reform is coming to KLIA immigration officers as they are now prohibited from using mobile phones while on duty to prevent "counter setting" syndicates- these used to allow ineligible foreign nationals to enter the country through "special counter lanes". MACC Chief Azam Baki also recommended alternative communication systems during working hours, ensuring immigration officers of all ranks do not carry mobile phones to avoid external contact. The schedule for assigning officers at the counters will be managed by a separate party, and will only be finalized after they have reported for duty and are already in the counter zone.

   The Governance Investigation Division (BPT) will conduct a two-month investigation into the entire work process and submit recommendations for comprehensive reforms to the Immigration Department and Ministry of Home Affairs.

   “The absence of third-party vetting in reviewing documents, such as return tickets and accommodation arrangements, also contributed to these issues, with hefty bribes further enticing officers to participate in such syndicates”, says Azam Baki.

2. MACC busts syndicate ‘focal person’

   The MACC has arrested an immigration officer identified as the key figure in the syndicate, allegedly the person facilitating the entry of foreign workers into Malaysia. The officer, who has been with the Immigration Department for about 20 years, was apprehended after evading authorities when investigations began. In total, the MACC has detained 60 individuals linked to the syndicate, including 49 immigration officers, one police officer, and 10 agents. Officers who are not charged due to lack of evidence but are still considered suspects are subject to disciplinary action by the Immigration Department. Gotta catch them all.

   The MACC's operations also led to the seizure of RM1.49 mil in cash and various assets, including luxury vehicles and gold. The investigation revealed that the syndicate operated by promoting illegal entry packages through social media, coordinating with immigration officers to allow foreign nationals to bypass standard procedures by going through a designated “special” counter at the airport customs, all for a fee ranging from RM200 to RM2,500 per worker. RM3.6 mil in 215 bank accounts linked to the case have been frozen.

3. Immigration officers hid almost RM1 mil obtained from the syndicate in bedrooms
   Shedding more light on the “counter-setting” syndicate, the MACC has busted two low-grade immigration officers with RM800,000 cash in their homes. The first officer, based in Pahang, had more than RM500,000 stored in a piece of luggage, while the other had almost a quarter of a million Ringgit stashed under his bed in his Melaka home. Both officers are salaried at a maximum of RM4,749 and RM4,052 monthly, respectively. Nothing suspicious here.

PPS opens up in Northern Malaysia as a flood countermeasure
The northern states of Kedah, Penang, and Perlis are currently grappling with severe flooding from the devastating rain over the last couple of days, here’s how the situation is on the ground:

1. In Kedah, the number of flood victims has risen to 2,194, comprising 388 families spread across 11 temporary evacuation centres (PPS) in six districts.

2. In Penang, the number of flood victims increased to 635 this morning from 236 just yesterday, with 173 families being accommodated in 11 PPS across the districts of Seberang Perai Utara (SPU), Seberang Perai Tengah (SPT), and Seberang Perai Selatan (SPS). The erratic weather in Penang also claimed two lives yesterday — when a tree fell on a car with two Chinese tourists in Pinang Peranakan Mansion in Lebuh Gereja. Firefighters were able to recover the bodies of a man in his 50s and a woman in her 30s, who are thought to be a father and daughter, from the wreckage around 5pm.

3. Further up north, Perlis has 2 PPS due to prolonged rain. Currently, the operational centres accommodate a total of 41 victims from 13 families.

Shorts

1. Najib Razak’s defence argues against biased charges

   The High Court was informed that the investigations leading to Najib Razak's charges in the RM2.28 bil 1MDB trial were described as "shoddy" and "incomplete". Defence lawyer Wan Azwan Aiman Wan Fakhruddin argued that the MACC had not completed recording Najib's statement before proceeding with charges, indicating a "predetermined intention" to prosecute him. His team also highlighted that the investigation was biased as Najib was not given clear details of accusations made towards him, resulting in an inability to prepare an effective defence.

2. ‘Disgusting’, says Criminal Investigation Department chief regarding GlSB investigation findings

   Bukit Aman CID Director Shuhaily Zain did not hold back in expressing his strong disgust regarding the ongoing investigation into GISBH, stating he feels "disgusted" by the results. His remarks came after police conducted raids on charity homes linked to GISBH, rescuing 402 individuals, including children. The investigation has revealed allegations of child exploitation and connections to organised crime, prompting authorities to record statements from over 740 individuals as part of their inquiry.

4. AROUND THE WORLD 🌎

Really, Israel? Pager bombs?
Hundreds of Hezbollah-owned pagers exploded in unison, with nearly 3,000 injured and 12 dead, including two children. It is widely assumed to be an Israeli operation, leading to Hezbollah retaliating with rocket strikes on Israeli artillery positions. If you are too young to know what is a pager, this is how it looks like.

The pagers were allegedly made by Taiwanese firm Gold Apollo, but the “very embarrassed” founder has stepped forward to say that the pagers were not theirs, but “had our brand on it”. Rather, the devices were made under licence by a company called BAC, based in the Hungarian capital of Budapest. A Lebanese security source was quoted saying Israel’s spy agency, Mossad, planted explosives in the pagers, considering they have a long history of “pulling off sophisticated attacks on foreign soil”.

Another speculation was that the lithium batteries in the pagers were triggered to overheat in a process called thermal runaway, where a chemical chain reaction increases the temperature of the battery to the point of explosion.

Some countries have voiced their concerns, calling out Israel for actions that could escalate tensions to a regional conflict in the Middle East. US Secretary of State Antony Blinken has called for all parties to refrain from escalation amid the heightened tensions from the pager bombs, which could derail the latest ceasefire talks in Gaza. Interestingly enough, Blinken did not say who the US believed was behind the pager bombs.

As an aside, on the topic of the ceasefire, Egypt said it will not allow Israeli troops to stay on its border with Gaza or accept any other changes to the security arrangements in place before the war between Israel and Hamas. Egyptian Foreign Minister Badr Abdelatty also said escalations, such as the pager bombs, could create hurdles for the completion of a ceasefire deal.

Several airlines, such as Air France and Lufthansa, have also suspended flights to Israel and Lebanon due to the pager bombs, with the decision called a precautionary measure to ensure the safety of passengers and crew.

NSFW Warning: Graphic scene of a pager exploding in a supermarket here.

Tech Talk

1. Crime messaging platform "Ghost" taken down with 51 arrested

   An international investigation led to the dismantling of the encrypted messaging platform “Ghost”, which was used to facilitate a wide range of criminal activities including money laundering and drug trafficking, with 51 suspects arrested, a drug lab in Australia dismantled, and a number of threats to life prevented. Weapons and drugs, along with over USD1.1 mil in cash have been seized globally. The platform allowed criminal organisations to communicate securely as it provided three encryption standards and offered the option to self-destruct all messages on a target phone.

2. Instagram: Teens accounts are now private by default

   The move to make teen accounts private by default is part of the firm’s move to make the platform safer for children amid growing backlash. Anyone under 18 in the US, UK, Canada, and Australia who sign up for Instagram will have their accounts marked as restrictive teen accounts, with existing accounts to be migrated within 60 days. Teens in the EU will see the same change later this year. Other measures will include more age verification requirements, a limit to sensitive content, and restrictions on private messages and usage.

3. Google victorious as USD1.66 bil fine scrapped

   The tech giant had challenged the fine by the EU, which accused Google of abusing its market dominance by restricting third-party rivals from displaying search ads between 2006 and 2016. Europe’s second-top court ruled that the European Commission “committed errors in its assessment”, with the commission possibly looking to appeal to the top court. This also marks a rare win for Google, which has seen fines between 2017 and 2019 due to antitrust violations.

Shorts

1. Tupperware files for bankruptcy

   The firm saw falling demand and, despite attempts to appeal to a younger audience, failed to stand out from competitors. Tupperware saw its shares fall over 50% following reports that it intends to file for bankruptcy. The firm will ask for court permission to start a sale of the business, though it aims to continue operating. 

2. BlackRock, Microsoft planning USD30 bil AI mega-fund

   Microsoft, investment giant BlackRock, and Abu Dhabi-backed MGX will be collaborating to launch an AI-focused fund worth over USD30 bil, placing it among Wall Street’s largest funds. The fund will focus on creating data centres and funding energy infrastructure, with Nvidia reportedly contributing its expertise.

3. The Sims movie confirmed

   Gaming firm Electronic Arts, owner of The Sims video game series, has confirmed a movie adaptation of the game will be made involving Margot Robbie’s production company LuckyChap, which also worked on the Barbie movie. Also involved will be Loki director Kate Herron, with British comedian Briony Redman co-writing the film. Electronic Arts has promised more details next year when the video game series marks its 25th anniversary.

5. FOR YOUR EYES 📺

1. Bankers may want to pay close attention to this by improving the credit engine with an age categorisation.

2. This is a very subtle review by MKBHD — this year’s iPhones are boring. The biggest joke — they don’t even come out of the box with the much-hyped Apple Intelligence, which will only be available later this year via a software update. Now it’s making us think, will it be another Siri flop?