The chair of the United Democratic Party (UDP), Kyaw Myint, violated anti-money laundering laws by receiving 16bn kyat ($12.2m) from China in 2015, the President’s Office spokesperson has said.
Zaw Htay told a press conference in Naypyitaw on Thursday that the disgraced party leader could receive a ten-year prison sentence for the offence.
He did not give details about who sent the money, but said that Kyaw Myint later spent 1.4bn kyat ($1.07m) to fund the UDP’s activities.
The party is fielding more candidates than the opposition Union Solidarity and Development Party for the November 8 election, even though it has never elected an MP and was little known until recently.
The President’s Office will now ask the Union Election Commission (UEC) to examine whether Kyaw Myint violated the Political Parties Registration Law by using money that was obtained illegally.
Kyaw Myint also imported construction materials from China without an import license, and there were no records of any tax payments for those trades, said Zaw Htay.
“The money in U Kyaw Myint’s bank accounts was transferred from China through unofficial hundi services,” he said. “We found out that 16.315 billion kyat was transferred into the UAB and AYA bank accounts of Myanmar Kyaw Investment… from China in 2015.”
Kyaw Myint escaped from Mandalay’s Obo prison and fled Myanmar in 1999 after being convicted of violating business laws. He returned in 2013 and was somehow able to live freely until last month, when police arrested him at his home in Yangon.
A prison official has said he will be made to serve the remainder of his nine-year sentence, and he has also been charged with the crime of escaping, which carries a maximum two-year sentence.
Kyaw Myint also made over 500m kyat in interest from loans between 2016 and 2020 but did not have a license to lend money from the Central Bank of Myanmar, Zaw Htay added.
Making loans without a license can carry a prison sentence of up to five years, he said.
No-shows
The UEC has already begun an investigation into the UDP’s finances.
Executives from the party were summoned for questioning by the commission on Wednesday but failed to show up, said Thein Htwe, the commission’s vice-chair.
Instead the party sent a letter asking for the appointment to be rescheduled, he told Myanmar Now.
The letter said the UDP’s central office and head office for accounts were in Yangon, that the party was occupied with its election campaign, and that travelling to Naypyitaw from Yangon was difficult because of Covid-19 restrictions.
“We formed a team here in Naypyitaw because the party is headquartered here,” said Thein Htwe.
The UEC has instructed the team to conduct the investigation from October 14 until October 20 and then submit a report, he added.
Khin Maung Oo, the UEC’s director general, said the commission “would be proceeding as necessary” in response to the party’s failure to attend.
The UDP’s central joint secretary, Kyaw Zwar Htet Oo, said: “At a time like this, they have to decide on a suitable location. And if they keep on picking a place that’s not possible to get to, it’ll just be obvious this isn’t a fair decision.”
The UEC has the legal right to assign any of its subdivisions to run an investigation into a party.
A party that fails to follow the UEC’s requests can be banned from engaging in political activity for three years. The party can then be abolished if it keeps failing to cooperate.
The commission’s decision is final and the party does not have the right to appeal.
Kyaw Myint was arrested at his home in Yangon on September 29 and is being held under tight security to prevent him escaping again.
Ten witnesses have been summoned to testify but prosecutors said earlier this month they have been unable to track them down.
Kyaw Myint’s conviction in the 1990s related to a company he owned called Myanmar Kyone Yeom.
He was charged for breaches of the Myanmar Company Act but the US State Department later suggested his company was involved in laundering drug money for the United Wa State Army.
He founded the UDP in Canada in 2007 and the party contested the 2010 and 2015 elections with a few dozen candidates but failed to win any seats.
This year it is fielding over 1,130 candidates, the second largest number after the National League for Democracy.
