KUALA LUMPUR – Troubled low-cost airline MYAirline Sdn Bhd will have to address allegations accusing its shareholders and board of directors of being involved in money laundering as well as criminal breach of trust when it responds to the Malaysian Aviation Commission (Mavcom).
According to Deputy Transport Minister Datuk Hasbi Habibollah (Limbang-GPS), there is also no possibility of the government bailing out the airline, which has claimed financial troubles to be the reason behind its sudden suspension of operations on October 12.
“They (MYAirline) have 14 days to submit their representation to Mavcom. They have to tell us everything. Even though there was hearsay before this, we (the government) did not take any action prior to any black-and-white of the suspension.
“Since there has been official notice (of the suspension), they have to answer us. All investigations will begin from that point onwards. If it’s just hearsay, we cannot take any action,” said Hasbi during Parliament’s Special Chamber session today.
The deputy minister was responding to queries from R. Yuneswaran (Segamat-PH) on how a major shareholder of MYAirline, who is said to be involved in money-laundering activities, could have been given government approval to operate an airline.
Mavcom, Hasbi said, had served MYAirline with a show cause letter on October 13, the day after the airline halted its operations without informing the authorities and its passengers.
Meanwhile, when pressed by Lim Lip Eng (Kepong-PH) for an assurance that the government will not attempt to bail out the airline with public money, Hasbi briefly said that the matter is out of the question.
“I think, if you ask me, the bailout days are over. You know what I mean… we have to focus on solving the issues faced by (MYAirline) customers,” he said.
Besides that, Hasbi also stressed that permits issued by government agencies to the company were approved after it was found that the airline had fulfilled the necessary safety and business-planning criteria.
“Based on Mavcom’s analysis of MYAirline’s operations and finances on October 3, there was no signs of escalating financial problems that could lead to the suspension of its operations.
“This can be seen by how there was minimal rescheduling of flights, and refunds to customers were completed within the required time frame. In fact, MYAirline also had plans to expand its operations from eight aircraft to 12 by the end of 2023.
“Everything looked okay, it was all on time, all ‘cantik’,” Hasbi said.
For the record, Mavcom had approved MYAirline’s air service licence for a one-year term from November 15, 2022 to November 14 this year.
The Civil Aviation Authority of Malaysia (CAAM) had approved the company’s air operator certificate (AOC) from October 1, 2022 to September 30 this year. The certificate was later renewed for a period of two years until September 30, 2025.
Earlier today, CAAM announced that MYAirline’s AOC has been suspended for a period of 90 days, effective today, pending further investigations by the authority.
CAAM chief Datuk Norazman Mahmud said in a statement that a safety audit was carried out on MYAirline from May 29 to June 1 for its AOC renewal and, at that time, there were no findings that indicated a state of financial distress.
In a press conference today, MYAirline interim accountable executive Datuk Seri Azharuddin Abdul Rahman said that there is no apparent Plan B to provide refunds to some 125,000 passengers affected by its sudden shutdown while awaiting funding from new investors to kick in.
He also said that the airline would require around RM20-22 million just to refund customers after the recent fiasco that affected its passengers and some 900 staffers locally.
Azharuddin pinpointed investors’ sudden withdrawals coupled with a lack of a contingency plan from the airline’s management as the reason behind the abrupt nature of its suspension. – October 16, 2023