Category: Financial Scandals

By Yow Hong Chieh | May 27, 2011
The Malaysian Insider

KUALA LUMPUR, May 27 — The federal government’s decision to buy back Selangor water bonds at a significant premium is not only an abuse of taxpayers’ monies but borders on the outrageous, Tony Pua has said.

Quoting The Edge Financial Daily, the DAP publicity chief said the RM6.5 billion rescue deal will see Putrajaya acquire the bonds for 94.49 against a mark-to-market value of only 54.54 at the end of last month, or 73.2 per cent above market value.
Continue reading “Pua: Water bonds premium price abuse of public funds”

Malaysiakini
Mar 10, 11

Malaysia recorded RM135.3 billion in errors and omissions (E&O) in its outflow funds for the period 2000 to 2009.

Prime Minister Najib Abdul Razak said considering the huge amount of trade transactions with the rest of the world as well as the lack of data for specific goods due to statistical errors or unrecorded transfer of funds, there was bound to be E&O in the balance of payments.

“Malaysia’s financial and economic trading with the world outside is seen in the balance of payments statistics, which is prepared according to a methodology set by the International Monetary Fund (IMF),” he said in his written reply to a question from Lim Kit Siang (DAP-Ipoh Timur) at the Dewan Rakyat sitting today.

Lim wanted to know the measures taken by the government in the light of a report by Global Financial Integrity (GFI) which stated that Malaysia saw illicit money outflows amounting to RM889 billion from 2000 to 2008 due to corruption and mismanagement. Continue reading “M’sia lost RM135.3 bil in illicit outflow”

By Shazwan Mustafa Kamal
November 13, 2010
The Malaysian Insider

KUALA LUMPUR, Nov 13 — The Selangor government is planning a 100,000-strong protest to submit a memorandum to the Yang di-Pertuan Agong on December 5 over the federal government’s possible bailout of Syarikat Bekalan Air Selangor (Syabas).

Top Selangor Pakatan Rakyat (PR) leaders informed The Malaysian Insider last night that the state’s move was part and parcel of a plan to “pressure” the Najib administration not to proceed with a multi-million ringgit bailout of the state’s privatised water industry, and that state-wide ceramahs and gatherings had already been planned in advance to mobilise the numbers needed to attend the December 5 gathering at Istana Negara.

“We are planning a 100,000-people gathering on December 5 to submit (a) memorandum to the Yang di-Pertuan Agong on the water issue. Venue will be at Masjid Negara, 12pm.
Continue reading “Selangor seeks royal hand over water bondholders’ bailout”

By Zairil Khir Johari

While everyone spent the last weekend mulling over the recently announced Budget 2011, I spent mine immersed in chocolates and experiencing a brief moment of notoriety on Lim Kit Siang’s blog.

It was back to business on Monday as I met up with two old friends over lunch. In true Malaysian fashion, our conversation flirted with everything from the erection, oops, election budget to matters of national (un)importance and just generally anything that came into mind. All this over banana leaf and lots of (burp) curry. The following is a parable of our discussion:

Friend A (special officer to a certain executive in a certain GLC): Service is so slow. Why does it take so long to make one iced Milo?

Friend B (self-employed IT entrepreneur): Nothing new about that…

Me (chocoholic): Yeah, what do you expect? We don’t get first class service on private jets like you.
Continue reading “A Malaysian Lunch”

The Minister in the Prime Minister’s Department Tan Sri Nor Mohamed is quoted in today’s press as saying that Talent Corporation has been tasked with attracting at least half of the 750,000 Malaysian professionals working overseas to come home as part of its efforts to draw the best brains in the world to Malaysia.

Speaking at the launching of the Public-Private Partnership’s website www.3pu.gov.my, he said seeking out the Malaysian diaspora for the top brains was necessary as the Government aimed to hit the target of RM115 billion per year in local and foreign investments to turn the country into a developed nation by 2020.

It is shocking that Nor Mohamed could come out with such an unrealistic and “tall order” not only because of the dismal failure of previous government “brain gain” policies but in the light of recent events when the unchecked escalation of the rhetoric of race and religion would have the effect of giving a major push to greater brain-drain from the country instead of pulling back talents from the Malaysian diaspora to return to serve the country.

It is time that the Prime Minister, Datuk Seri Najib Razak and his Ministers wake up and realize that the twin crisis of human talents and investments confronting the country are more than a matter of economics.
Continue reading “When will Najib and his Ministers wake up and realize that the twin crisis of human talents and investments confronting the country are more than a matter of economics?”

The Malaysian Insider

KUALA LUMPUR, Aug 5 — One-time Malaysian icon, the 100-year-old Sime Darby Berhad, appears to be in a downward spiral as it faces huge losses again after the last one 13 years ago, with top officials being taken off from several units.

The Malaysian Insider understands that the government conglomerate will next month announce that potential full-year net loss could top RM2 billion — and go as high as RM2.5 billion. Most of the losses are down to ill-advised investments in the energy and utilities sector in Qatar as well as tardy business practices in the development of the Bakun dam in Sarawak.

The last time Sime Darby saw red on its balance sheets came after the 1997 Asian Financial Crisis, when a plunge in the stock market and a sharp depreciation of the ringgit led its financial arm, Sime Bank, to post a RM1.6 billion loss — the largest in Malaysian banking history — for the six months to December 1997. The conglomerate went on to post a six-month loss of RM676.2 million and closed the 1998 financial year with a net loss of RM540.9 million.
Continue reading “Sime Darby to report biggest ever loss”

The charge preferred against former MCA President and Transport Minister, Tun Dr. Ling Liong Sik, in connection with the RM12.5 million Port Klang Free Zone (PKFZ) scandal has mystified many.

The charge against Ling reads:

“That you, between Sept 25 and Nov 6, 2002, at Level 4 of the Prime Minister’s Office in Bangunan Perdana Putra, cheated the Govern ment by deceiving the Cabinet into approving a land purchase in Pulau Indah for a Mega Distribution Hub project in Port Klang according to the terms agreed between Kuala Dimensi Sdn Bhd and Port Klang Authority which, among others, are:

1. the size of the land being 999.5 acres or 43,538,200 sq ft

2. the purchase price for the land being RM25 per sq ft amounting to a total of RM1,088,456,000

3. the repayment period being based on a “deferred payment” of 15 years with an interest rate of 7.5% per annum (total RM720,014,600), and thereby dishonestly hiding the fact that the valuation by the Valuation and Property Service Department on the land was RM25 per sq ft for a repayment period of 10 years or RM25.82 per sq ft for a repayment period of 15 years, including coupon/interest that could be charged for the repayment period.

Continue reading “Will Mahathir or any of his Ministers in 2002 Cabinet testify in court of being misled by Ling to approve Port Klang Authority’s purchase of PKFZ land with 15-year repayment with compound interest instead of 10 years?”

The decision by the Transport Minister, Datuk Seri Kong Cho Ha to override the decision of the Port Klang Authority (PKA) and direct it to pay its Port Klang Free Zone (PKFZ) bond obligation of RM222.58 million to Freezone Capital Bhd (FZCB) is another proof that his topmost concern and those of the Najib Cabinet is to bail out the PKFZ turnkey contractor Kuala Dimensi Sdn. Bhd (KDSB) rather than to do justice to the 27 million Malaysian people in the RM12.5 billion PKFZ scandal.

The PKA Board had acted properly in expressing reservations on the payment of RM222.58 million to KDSB’s special purpose vehicle, FZCB, because of an RM1.4 billion ongoing suit and considering withholding payment because of its worry that it may not be able to recover funds from KDSB.

Kong’s decision is all the more deplorable as it has now been revealed that KDSB had given undertakings that it will cover any shortfall in bond repayments should PKA fail to do so, making it KDSB’s problem and not that of Malaysian taxpayers.
Continue reading “Call for reports of the PKFZ scandal “super taskforce” to be made public to account for actions taken by Najib administration in past year”

By Christine Chan | Malaysiakini

Deputy Transport Minister Abdul Rahim Bakri has given an assurance that the government will pay what is due to the Port Klang Free Zone (PKFZ) bondholders.

“We have a commitment to the bondholders, therefore we have to fulfill it,” he told the House today, when winding up matters relating to the ministry in the 10th Malaysia Plan.

He was replying Lim Kit Siang (DAP-Ipoh Timor) who had asked whether Port Klang Authority (PKA) would make any payments to PKFZ turnkey contractor Kuala Dimensi Sdn Bhd (KDSB), given the legal dispute between them.

PKA is due to pay RM723 million to the bondholders tomorrow, akthough it has taken KDSB to court for alleged overcharging.

The Internal Revenue Board (IRB), Lim noted further, has also asked PKA to pay RM328 million owed by KDSB in alleged backdated taxes.
Continue reading “PKFZ: ‘Gov’t will pay RM700mil to bondholders’”

By Tunku Abdul Aziz

There is a place for conglomerates in the business world. However, as with everything else, some are good, but mostly they invariably become unwieldy and difficult to manage effectively. Many come unstuck, leaving behind a trail of miserable examples of management failures, human greed and frailties. As always, there is a lot of cleaning up to do after the party is over. The sad truth is that we do not as yet have what it takes to run a complex business successfully, and a conglomerate is hellishly difficult to keep on a straight course because the temptation to wander off into the unfamiliar is often irresistible, and most conglomerates find themselves up a creek.

There have been many instances of major failures in the Sime stables. There was the case of the insurance business in the UK in the eighties, a member of Lloyds, which was in such a bad shape because of mismanagement that it had to be bundled with a very profitable money broking company into an attractive package and sold for a song. Sime Darby naturally had to be responsible for all the liabilities resulting from claims on policies transacted up to the time of the sale of the company. For the next several years after the sale of the company to the new owners, Sime Darby continued to send out to the UK enormous sums of money to cover the claims.
Continue reading “SIME DARBY: A Conglomerate Gone Awry”

by Dr Lim Teck Ghee

What financial crisis?’

Readers following the great national debate initiated by Minister Idris Jala in the Prime Minister’s Department on the possibility of the country going bankrupt must be thoroughly confused with the mixed messages from government.

On the one hand, we are told that the country is more prosperous than ever before and that absolute poverty in the country, for example, is almost completely eradicated. We are also told that the country’s economy is in good hands and that the finances of the country are well-managed.

Every few days or so, we are reminded of how fortunate we are to be living in Malaysia and how much foreign investors love us. Just a short while ago, it was trumpeted that our competitiveness had shot up this past year so that we are now ranked number ten in the world – ahead of many advanced economies.
Continue reading “Malaysia: A ‘bankrupt’ nation?”

By S Pathmawathy | Malaysiakini

Though the newly-appointed Transport Minister Kong Cho Ha has said there is no need to look further into the Port Klang Free Zone (PKFZ) fiasco, opposition veteran Lim Kit Siang (DAP-Ipoh Timur) has refused to let the matter go.

The DAP veteran politician during the question-and-answer session in the Dewan Rakyat, demanded to know why then-Transport Minister Chan Kong Choy has not been probed despite being implicated by the Public Accounts Committee (PAC) in the controversy.

The PAC had recommended in its report on the PKFZ controversy last year that Chan be probed for criminal breach of trust (CBT) over his allegedly wrongful issuance of three letters of support.

Chan was said to have issued the letters of support for a turnkey contractor without the approval of the Finance Ministry to raise funds for the PKFZ project, costs of which may balloon to a whopping RM12.5 billion.
Continue reading “‘When will PKFZ probe be done – Resurrection Day?’”

Tweets @limkitsiang:

My Q in Parl – progress in MACC campaign agnst ‘grand corruption’ n Y no big fish in PKFZ scandal nabbed?
Wednesday, June 09, 2010 10:02 AM

But as expected Stonewalling answer saying MACC investigating although I reminded House of AG saying last Dec that more arrests 2come RT @beyondrock Now that is a good Question
Wednesday, June 09, 201010:29 AM

Asked why no action on PAC proposal agnst exTransp Minister ChanKongChoy 4CBT 4issue illegal LettersOfSupport DepMin LiewVuiKeong was silent
Wednesday, June 09, 2010 10:40 AM

AGGani said Dec re PKFZ:”This is just tip of d iceberg..just 1st phase of investigations..certainly not end of matter but just beginning..Other individuals will b charged in stages” Now nothing after >6mths
Wednesday, June 09, 2010 10:50 AM

By P. Ramakrishnan | Aliran

More than 66,000 Indians, mostly poor and from the estates, invested RM103 million with high expectations of good returns. That was what they were promised, and they were enticed to rally around this Indian venture that was solely for the Indians. Many pawned their jewellery, others took loans or invested their entire life-savings to support this venture that was touted as a sure-win undertaking.

For almost 30 years, they waited in vain to enjoy the fruit of their investment. Many continued to service their loans and suffered. Others passed on, dejected and frustrated. There was no hope for them whatsoever and they stopped dreaming of the wealth that was promised them.

While the Maika shareholders suffered, the directors of Maika continued to be paid very well. They did not take a pay cut but enjoyed their full benefits.

Now, there is some kind of offer for these shareholders. They are now being offered RM0.80 for every RM1.00 they had invested. After waiting for almost 30 years, now they have to suffer not only a 20 per cent loss on their investment but also the purchasing power of whatever they receive now is a lot lower than it was 30 years ago. Instead of some gains, they are forced to suffer a further loss after 30 long years. What a tragic end to their dreams!
Continue reading “MIC, Maika deserve to be cursed for 10 generations”

Malaysian Insider
By Asrul Hadi Abdullah Sani
May 29, 2010

KOTA BARU, May 29 — Pakatan Rakyat (PR) leaders used dire forecasts of a gloomy future if there are no subsidy cuts to warn that voting for Barisan Nasional (BN) in the next general election would lead the country to bankruptcy.

A government minister this week had predicted Malaysia could be bankrupt by 2019 if it does not begin to cut subsidies for petrol, electricity, food and other staples, which cost RM74 billion last year. But the Najib administration is waiting for public feedback before deciding on actual cuts.

DAP leader Lim Kit Siang said it was not subsidies but BN’s corruption and abuse of power that has led the country to current financial crisis.

“I cannot imagine if DAP, PKR or PAS had made the announcement that country will be bankrupt by 2019. If we did, Umno would have labelled us as anti-nationalist and traitors. We probably would have been locked up in ISA and given free food.

“Remember Vision 2020? We were supposed to become a developed nation by 2020 but unfortunately one year before 2020, we are already bankrupt,” he told a crowd last night in Tanah Merah, a two-hour drive from the Kelantan state capital.

Lim was one of many PR leaders in the state speaking at ceramahs ahead of the PKR convention this weekend. Continue reading “Vote BN for bankruptcy, warns Pakatan”

The Prime Minister, Datuk Seri Najib Razak has dodged questions about the Sime Darby costs overruns scandal since the GLC-conglomerate’s May 13 admission of RM964 million losses for the second half of FY2010, comprising:

1.	Qatar Petroleum (QP)	RM200 million
2.	Maersk Oil Qatar (MOQ)	RM159 million
3.	MOQ marine project	RM155 million
4.	Bakun Dam	RM450 million
Total		RM964 million

These are however only a part of the losses suffered by Sime Darby from these projects, for instance:

• the RM974 million QP project which was awarded in April 2006 and scheduled for completion in August 2008 incurs losses exceeding RM500 million;

• the RM2.2 billion MOQ Project, awarded in January 2007 and due for completion in October 2009 incurs RM526 million losses.

Continue reading “Najib should not dodge questions but should answer frankly whether the Bakun Dam project has cost overruns of RM1.7 billion and that the government will be asking Parliament for a RM700 million bailout package for Sime Darby”

In September last year, the Prime Minister Datuk Seri Najib Razak announced the setting up of a Cabinet super task force headed by the Chief Secretary to the Government Tan Sri Mohd Sidek Hassan, to investigate the RM12.5 billion Port Klang Free Zone (PKFZ) scandal.

I had specifically asked at the time why the Chief Secretary Sidek Hassan was appointed to head such an inquiry into the PKFZ scandal, and why he had failed to conduct such an inquiry earlier as this was resolved by the Cabinet in July 2007 when it decided on the RM4.6 billion bailout of PKFZ, including giving retrospective approval to the four illegal Letters of Support unlawfully given by the two previous Transport Ministers, Tun Dr. Ling Liong Sik and Tan Sri Chan Kong Choy which have landed the country in the RM12.5 billion PKFZ scandal.

Although the Attorney-General and the Malaysian Anti-Corruption Commission (MACC) had publicly promised that action would be taken against “grand corruption” in the PKFZ scandal, meaning the “big fishes”, why no action has been taken against such “big fishes” with only a few mid-fishes being arrested and prosecuted for corruption?

I want to specifically ask why the two former Transport Ministers Liong Sik and Kong Choy have been left off scotfree.
Continue reading “Call on government to stop RM770 million payout this year to KDSB for the RM1.25 billion PKFZ scandal until full accountability by the Cabinet super-task force headed by Chief Secretary”

Today’s media report top government leaders virtually falling upon one another in their competition to denounce and declare action being taken against fugitive blogger Raja Petra Kamaruddin and Malaysia-Today website under the Official Secrets Act for leaking on the Internet an 18-page Treasury Memorandum to the Cabinet in June 2007 on the RM12.5 billion Port Klang Free Zone (PKFZ) scandal.

Led by the Prime Minister, Datuk Seri Najib Razak, those who had spoken of action under the Official Secrets Act include the Home Minister, Datuk Seri Hishammuddin, the Attorney-General Tan Sri Gani Patail, the Deputy Inspector-General of Police Tan Sri Ismail Omar and Director of Commercial Criminal Investigation Department, Datuk Koh Hong Sun.

However, none of them has shown any concern about the right to know of Malaysians about the hows and whys the taxpayers are being burdened with the “mother of all scandals” – the RM12.5 billion PKFZ scandal running through three Prime Ministers, three Finance Ministers and four Port Klang Authority Chairmen.

Najib said: “We will inform the people what we should concerning the case and we will do so later but that is no excuse to reveal cabinet papers.”
Continue reading “Why didn’t AG Gani prosecute previous Transport Ministers Ling and Chan for unlawfully issuing 4 Letters of Support causing the RM12.5 billion PKFZ scandal?”

By Hussein Hamid

Tell me who would be stupid enough to go and buy a bank in Indonesia? You tell me who would do that? Then if that was not enough you go and take a running jump into Pakistan and buy another bank there. But wait there is more! While they are doing that why not pick up a bank in Vietnam. In all they spent an incredible RM10.8 billion to acquire these three banks. Who would be stupid enough to do this when Maybank has been advise AGAINST making the purchase? Maybank belongs to the Government and so they will take instructions from the Government. Taking instructions from a Government run by idiots who thinks that Maybank is also Maybank. So in essence it is the Barisan Government that is stupid enough to go and buy three Banks in Indonesia, Pakistan and Vietnam for RM10.8 billion.

Now Malayan Banking has confirmed that it lost RM2 billion in this escapade. Now which UMNO guy made a few hundred million in commission from these purchases? Who are the usual suspects? Najib as the Minister of Finance has to be suspect number one – but if MACC does the questioning they will say that he is just ‘helping with inquires’. But Najib must beware that even helping with inquiries can be dangerous if Muhyiddin has anything to do about it.
Continue reading “Another RM2 billion loss?”

The Cabinet tomorrow should overrule Transport Minister, Datuk Seri Ong Tee Keat’s “passing-the-buck” game and direct the immediate and full publication of the PricewaterhouseCoopers (PwC) Report on the Port Klang Free Zone (PKFZ) scandal and to respond to the Edge cover report that the cost of PKFZ had escalated fourfold from the original RM1.8 billion to RM8 billion.

Ong should not try to distract public attention from the real issues about the PKFZ scandal by threatening that he would be “checking with his legal adviser and see if the article carried in the weekly was libellous”. (Star April 27, 2009)

Let him respond fully, frankly and forthrightly to two issues:

Firstly, why as the Transport Minister he had reneged on his promise made in April last year, as reported by Star (April 8, 2008) headlined: ”Ong to tell all on Port Klang Free Zone” quoting him:

“I wish to inform the rakyat about the true situation – whether it was actually squandered, not squandered, and whether it has gone to, as well as the breakdown of the budget.”
Continue reading “RM8 bil PKFZ scandal? – Cabinet tomorrow should overrule OTK’s “passing-the-buck” game and direct immediate release of PwC Report”