The Role of the Malaysian A-G in Political Scandals


June 20, 2017

 

Image result for Apandi AliThe Malaysian Attorney-General is the Public Prosecutor. He must uphold the Rule of Law. (The Malaysian Constitution–Article 145). His job is to protect the public interest, act with objectivity, take proper account of the position of the suspect and the victim, and pay attention to all relevant circumstances, irrespective of whether they are to the advantage or disadvantage of the suspect.
The Malaysian Constitution–Article 145

 

The Attorney General is the principal legal adviser to the Government. His role and responsibilities are provided for in Article 145 of the Federal Constitution. Article 145 of the Federal Constitution provides:

(1) The Yang di-Pertuan Agong shall, on the advice of the Prime Minister, appoint a person who is qualified to be a judge of the Federal Court to be the Attorney General for the Federation.

(2) It shall be the duty of the Attorney General to advise the Yang di-Pertuan Agong or the Cabinet or any Minister upon such legal matters, and to perform such other duties of a legal character, as may from time to time be referred or assigned to him by the Yang di-Pertuan Agong or the Cabinet, and to discharge the functions conferred on him by or under this Constitution or any other written law.

(3) The Attorney General shall have power, exercisable at his discretion, to institute, conduct or discontinue any proceedings for an offence, other than proceedings before a Syariah court, a native court or a court-martial.

(3A) Federal law may confer on the Attorney General power to determine the courts in which or the venue at which any proceedings which he has power under Clause (3) to institute shall be instituted or to which such proceedings shall be transferred.

(4) In the performance of his duties the Attorney General shall have the right of audience in , and shall take precedence over any other person appearing before, any court or tribunal in the Federation.

(5) Subject to Clause (6), the Attorney General shall hold office during the pleasure of the Yang di-Pertuan Agong and may at any time resign his office and, unless he is a member of the Cabinet, shall receive such remuneration as the Yang di-Pertuan Agong may determine.

(6) The person holding the office of Attorney General immediately prior to the coming into operation of this Article shall continue to hold the office on terms and conditions not less favourable than those applicable to him immediately before such coming into operation and shall not be removed from office except on the like grounds and in the like manner as a judge of the Federal Court.

The Role of the Malaysian A-G in Political Scandals

The A-G’s quick dismissal of the DoJ’s second suit and his vigorous defence of the Prime Minister against any criminal wrongdoing has raised eyebrows.

by  Lim Wei Jiet

http://www.freemalaysiatoday.com

Image result for malaysian official 1

 

A little over 24 hours ago, the US Department of Justice (DoJ) filed a second suit to recover more assets allegedly acquired using 1MDB funds. The 251-page complaint sheds more light on the scandal and seeks to seize assets such as yachts, diamonds, rights to Red Granite Pictures films and paintings by notable artists.

In a matter of hours, the Malaysian Attorney-General (A-G) saw fit to release a press statement. Two observations were made from this press statement:

Number One – the A-G was unmistakably dismissive of the DoJ’s second suit: “This second action comes on the anniversary of the first, and appears to be a repeat of it”.

Number Two – the A-G mounted a vigorous defence of the prime minister: “The attorney-general expressed his strong concerns at the insinuations and allegations that have been made against the Prime Minister of alleged criminal wrongdoing in relation to the civil action”.

With respect, these postures adopted by the A-G are both misconceived and not in line with the role of an attorney-general in law. Make no mistake – this second civil suit is not a repeat of the first filed on July 20, 2016.

First, the DoJ has now quantified the alleged misappropriated funds at US$4.5 billion from the initial US$3 billion. Second, it reveals several new “phases” in which funds were allegedly siphoned from 1MDB. Third and most obvious, it has identified more assets in which these misappropriated funds were spent on.

It is therefore unfathomable how the A-G can reach a conclusion that the second civil suit is a repeat of the first, what more in a matter of hours after its release.

Eyebrows were also raised as to how quickly the AG sought to shield the Prime Minister from allegations of criminal wrongdoing.

These statements appear to be incongruent with established international conventions on the role of prosecutors.

Article 13(b) of the UN Guidelines on the Role of Prosecutors 1990 states that prosecutors shall “(b) protect the public interest, act with objectivity, take proper account of the position of the suspect and the victim, and pay attention to all relevant circumstances, irrespective of whether they are to the advantage or disadvantage of the suspect”.

Meanwhile, Article 3 of the International Association of Prosecutor’s Standards of Professional Responsibility 1999 states that “Prosecutors shall perform their duties without fear, favour or prejudice. In particular they shall…act with objectivity; have regard to all relevant circumstances, irrespective of whether they are to the advantage or disadvantage of the suspect…always search for the truth and assist the court to arrive at the truth and to do justice between the community, the victim and the accused according to law and the dictates of fairness.”

Moving forward, it is humbly recommended that these guidelines be followed by the A-G:

• To appoint a special prosecutor of unimpeachable integrity to investigate and take appropriate action in relation to the 1MDB matter, as the attorney-generals in the US have done in Archibald Cox during the Watergate scandal and Robert Mueller towards Russian interference in the US elections.

• Whenever a foreign jurisdiction takes action on matters relating to the 1MDB matter, take appropriate time to read and liaise with the authorities to comprehensively assess all relevant angles before dismissing the same.

• Whenever any party alleges or accuses a person investigated in the 1MDB matter, take appropriate time to reach out to such parties for more information before dismissing the same.

• Never attack or defend any person currently being investigated in the 1MDB matter to prevent an impression of bias.

If one needs a role model, one can look no further than our US brethren in Sally Yates, the acting US attorney-general who defied US President Donald Trump in defence of the Rule of Law and the dignity of the DoJ.

I end by quoting a paragraph of her poignant speech to the Harvard Law School’s graduating class of 2017:

“There is plenty worth fighting for. For me, it’s criminal justice reform — so that we can have a fair and proportional criminal justice system that applies equally to all regardless of race, wealth or status. It’s also respect for the brave men and women of law enforcement who put their lives on the line to protect us. It’s holding corporate executives who break the law accountable so that cheating and stealing doesn’t become just a way of doing business…It’s the rule of law, and the principle that our law enforcement and intelligence agencies must be free to do their work without political interference or intimidation.”

Lim Wei Jiet is an advocate and solicitor of the High Court of Malaya. He is also the deputy co-chairperson of the Malaysian Bar Constitutional Law Committee.

The Ethically-Blighted Prime Minister of Malaysia–Najib Razak


June 19, 2017

The Ethically-Blighted Prime Minister of Malaysia–Najib Razak

by Dr.M. Bakri Musa, Morgan-Hill, California

Image result for Najib Razak and Rosmah Mansor

As for MO1, his spouse and stepson, they are beyond shame. With the millions if not billions they have already expropriated, they can handle the setback. Malaysians however, would be saddled for generations with 1MDB’s humongous debt. Quite a legacy for the son of the late Tun Razak! As for the Tun, what a legacy to have bequeathed Malaysia with his ethically-blighted son.–M.Bakri Musa

The dismissive attitude of Malaysian officials to the latest US Department of Justice’s (DOJ) civil forfeiture lawsuit targeting expensive assets allegedly acquired with funds illicitly siphoned from 1MDB is misplaced. Their stance is an embarrassing display of gross ignorance.

Yes, civil lawsuits in America are as common as mushrooms after a rainfall. This DOJ action however, is the largest (in dollar value) such forfeitures to date. This second set of lawsuits targeted assets allegedly given to Hollywood celebrities, as well as to the spouse of “Malaysian Official 1” (MO1). The two categories are separate though the latter believe that she is in the same class as the former.

Najib apologists and enablers never fail to point out with unconcealed smugness that the defendants to the lawsuits are not individuals, specifically Najib or his associates and relatives, rather those assets.

That is right, but such sophistry reveals a fundamental ignorance of the American judicial system. Those targeted assets do not exist in vacuo; someone or somebody owns them. They in effect are the defendants.

By targeting those assets and not their owners, DOJ is spared the task of identifying their rightful owners. That can be an arduous and expensive task, what with multiple shell companies involved in dizzying number of foreign jurisdictions. Instead, all DOJ has to do is wait for the owners to come out of the woodwork to identify themselves and lay claim to those assets by challenging the lawsuit. They have to, otherwise they would lose those assets, or at least their share.

One of those owners is Jho Low. He claimed to have bought those assets with his family’s wealth. That at least was believable as he came from a wealthy clan in Penang. Sure enough, his family’s assorted trusts too have contested the lawsuit from faraway New Zealand!

Image result for Reza Aziz and J Lo

Then there is one Reza Aziz, identified as the “stepson of MO1.” Where did this son of a nondescript Malaysian army officer get his wealth? From his mother, the daughter of my parent’s contemporary as a village school teacher in Kuala Pilah? Visit her dilapidated ancestral home back in my kampong, and her current flamboyant lifestyle today would make you puke. As for Reza’s stepfather Najib Razak, that man had spent his entire adult life in government, with its measly pay.

Reza Aziz concocted the idea that the money (some hundred million!) was a “gift” from a benevolent Saudi Sheik. Even the wealthiest corpulent Sheik would not be so extravagant with his favorite toy-boy, yet this Reza Aziz character wants those seasoned DOJ prosecutors to believe his story! Even his American accountants did not believe him.

One other owner has also come forward. Hollywood celebrity Leonardo DiCaprio has not only surrendered the gifts he had received “from the parties named in the civil complaint” but went further and cooperated with DOJ investigators. That cannot be good news for either Jho Low or Reza Aziz.

Any bets whether any of the other “owners,” specifically the alleged recipient of that pink diamond, MO1’s spouse, would return their gifts? It is worth pondering whose actions better reflect the forgiving spirit of Ramadan, hers or DiCaprio’s?

Najib supporters trivialize the DOJ’s lawsuit, citing its lack of “action” after its first filing last year as proof of its political intent. To them, these series of forfeiture lawsuits are yet another albeit more sophisticated American attempt at regime change.  Such commentaries reveal a pathetic lack of the basic understanding of the US justice system.

This asset forfeiture is a civil lawsuit. Unlike criminal ones where the axiom “justice delayed, justice denied” is adhered to, civil suits can and do drag on for years. They go to trial only when all parties are ready, and all extraneous issues as with ownership claims settled. The fact that these forfeiture lawsuits drag on should not be misinterpreted in any way.

There is also the possibility that criminal charges would be filed against specific individuals during the discovery or the trial.

There is only one certainty. Once a lawsuit is filed, those assets are effectively tied up. They cannot be sold, mortgaged, or altered in any way without the court’s consent. DOJ has in effect total control of those assets, meaning, their de facto owner.

These forfeiture lawsuits will not be settled out of court. Those prosecutors have a point to prove, and with unlimited resources to pursue it. That reality has prompted owners like DiCaprio to cooperate with DOJ.

This will not be like a Malaysian trial where prosecutors could be illicitly paid off or where defense lawyers openly brag about having judges in their (lawyer’s) back pockets. The defendants have hired some of the best legal minds including those who had once worked in DOJ and had successfully prosecuted many high profile kleptocrats. It will be far from a walk in the park for the DOJ lawyers.

DOJ does have something in its favor. In a civil suit, unlike a criminal trial, the burden of proof is lower, only the “preponderance of evidence” and not “beyond reasonable doubt.” The burden of proof also shifts from the plaintiff to the defendant. Meaning, the owners have to prove that the funds they used to purchase those assets were untainted. It would be very difficult to convince an American jury that a Middle Eastern sheik would willingly part away with hundreds of millions of dollars to a Malay boy no matter how pretty he looks, for nothing in return.

Regardless of the outcome, this trial would expose to the world all the sordid ugly details of the 1MDB shenanigans. Once those are out, not many would be proud to call themselves Malaysians. They would be downright ashamed for having elected a leader with such unbounded avarice, and then letting him get away with it for so long.

Image result for Najib Razak and Tun Razak

As for MO1, his spouse and stepson, they are beyond shame. With the millions if not billions they have already expropriated, they can handle the setback. Malaysians however, would be saddled for generations with 1MDB’s humongous debt. Quite a legacy for the son of the late Tun Razak! As for the Tun, what a legacy to have bequeathed Malaysia with his ethically-blighted son.

Malaysia’s Man of Honour and Integrity: The Forgotten 3rd Premier Tun Hussein Onn


June 18, 2017

Malaysia’s Man of Honour and Integrity: The Forgotten 3rd Premier Tun Hussein Onn

by FMT Reporters

Image result for Tun Hussein Onn

DAP supremo Lim Kit Siang wants the federal cabinet to make the US Department of Justice’s (DoJ) latest court filings related to 1Malaysia Development Bhd (1MDB) a priority agenda in its next meeting.

The Gelang Patah MP said the 36 ministers need to live up to the integrity of the late former Prime Minister Tun Hussein Onn who led the country from 1976 to 1981 and whose son Hishammuddin Hussein is today a part of the cabinet lineup.

Calling the 251-page document in the legal suit “a shocker of shockers”, he said the ministers need to decide how to cleanse and purge Malaysia in light of the allegations made.

He claimed that it revealed not only a “complex web of deceit and treachery in stealing billions of ringgit of 1MDB funds for personal and private use and aggrandisement, but (also) the depths of depravity some Malaysians had been prepared to descend to steal and lavish on themselves billions of ringgit of public funds from the 1MDB scam.”

“I call for a nation-wide people’s campaign for the collective resignation of the cabinet if the 36 ministers cannot do anything at its meeting,” he said, adding that Malaysia needed to be cleared of the “ignominy and infamy” of being regarded as a global kleptocracy.

“Ministers who have not read the updated DoJ’s 251-page kleptocratic action against 1MDB by Wednesday’s cabinet meeting should identify themselves, for clearly they are not fit to be in the cabinet,” he said in a statement today.

The DAP parliamentary leader also asked if there are any “modern-day Hussein Onns” in the current cabinet, referring to the third prime minister who he said had an impeccable personal integrity and abhorrence of corruption.

He added that Hishammuddin, who is the defence minister, was wrong in asserting on Friday that the DoJ filing would divert attention from the government’s larger agenda.

Image result for HishamuddinTun Hussein

Integrity is Greek to these UMNO Leaders–PM Najib Razak, Minister of Defence Hishamuddin Tun Hussein Onn and Deputy Prime Minister Dr. Zahid Hamidi

“Hishammuddin could not be more wrong, for there can be no bigger agenda in Malaysia than to ensure that democracy in Malaysia does not mutate into a kleptocracy, and the national imperative to uphold integrity in public life,” he said.

Lim claimed that Hussein would have agreed with him.“I have no doubt that if Malaysia had been accused of being a ‘global kleptocracy’ when Hussein was Prime Minister, he would have made it his top agenda to resolve the matter,” he said.

Hussein would also have had no hesitation in tendering his resignation as Prime Minister if he was unable to clear the nation of such “infamy and ignominy”, Lim added.

“Does Hishammuddin agree with me, or am I wrong in attributing such qualities of uncompromising commitment to public integrity to his father, the third Prime Minister of Malaysia?”

He said Malaysians will know soon whether there are any patriotic ministers who are prepared to make a principled stand to quit if the cabinet is unable or unprepared to respond honourably in the matter.

He said no loyal and patriotic Malaysian can read the legal document without “intense shame, consternation and horror.” He claimed that it represented the nation’s greatest shame in its 60-year history since independence.

In its court filing in California on June 5, the DoJ is seeking to seize US$540 million (RM2.3 billion) in assets, including art works, jewellery, a luxury yacht and film rights purchased with funds allegedly embezzled from 1MDB.

The assets named in the applications included the film rights to the two comedies “Dumb and Dumber To” starring Jim Carrey and “Daddy’s Home” featuring Will Ferrell.

The action follows last July’s civil forfeiture suit by the DoJ which sought to recover all the assets including but not limited to the Park Lane Hotel in New York, a luxury hotel in Beverly Hills, condominiums in New York, a private jet and expensive works of art, as well as finances related to Martin Scorsese’s movie “The Wolf of Wall Street” starring Leonardo DiCaprio.

 

Coping with one’s fears and concerns


June 18, 2017

Coping with one’s fears and concerns

by Dean Johns@www.malaysiakini.com

Image result for dealing with fear and anxiety

Having tried in recent columns to comprehend why I’ve had so much trouble keeping on writing in my increasingly old age, and thus far postulated that my problem might be either depression or else pressure amounting to panic at approaching my ultimate and literally last deadline, death, I feel a bit dumb to have missed an even more dire and pressing possibility, fear, or even first signs of, dementia.

As I was sadly reminded the other night at dinner with a friend and her beloved 85-year-old husband whose dementia has now progressed so far as to regress him into what’s commonly and all-too-accurately called “second childhood”, this is a terrible situation for families and friends as well as for sufferers.

But thankfully, despite the fact that every memory lapse, “senior moment” or an episode of writer’s block I experience makes me momentarily fear the worst, I’m still capable of convincing myself that I don’t yet have any of the senile varieties of dreaded dementia.

And also still capable of reminding myself of how fortunate I am – and as you apparently are too, considering that you’re sufficiently compus mentis as to subscribe to and read Malaysiakini – to have survived or avoided a good many of the countless juvenile and other dementias that threaten to render every one of us metaphorically if not literally brain-dead at every age and stage of our lives.

Starting from infancy for myself and fellow males with he-mentia, the clearly man-made and culturally if not sexually transmitted delusion that “nature” and even an allegedly omnipotent and of course male “divinity” have privileged our portion of what we presumptuously call “mankind” with some kind superiority over the rest of personkind, especially womankind.

Image result for Be Positive
Stay Positive always

 

The root-cause of he-mentia, of course, is the fact that, as a fridge magnet that’s popular in Australia proclaims, “every male is born with both a brain and a penis, but only enough blood to operate one of these organs at a time.”

In other words, as smart as at least some of us hetero male members of the species we flatter with the name “Homo sapiens” can be, we’re equally capable of acting like total dickheads.

In fact, far too many of us males are total dickheads all the way through and all of the time, seeing he-mentia not as a pathological condition to be suffered or better still, for the benefit of all concerned, overcome, but as a competitive edge to be celebrated.

Thus the poisonous pre-eminence, at least so far in human history, of the patriarchies, phallocracies or whatever else you choose to call dick-headed dictatorships founded on the he-mented fallacy (phallusy?) that male might is right.

Big dick-headed dictatorships today ranging from ruling regimes in countries like the Communist Party’s China and Putin’s Russia, to their countless small dick-headed counterparts all the way from al-Assad’s Syria through UMNO-BN’s Malaysia to the Zanu-PF’s Zimbabwe.

Then, of course, there are the dick-headed ‘religious’ dictatorships running so-called “theocracies like Iran” as well as most of the world’s so-called “faiths”. And, perhaps most pernicious of all, dick-headed domestic or family dictatorships sustained by verbal, psychological, economic and sundry other forms of abuse or outright violence against women and children.

Thank goodness that in my own case, the state of he-mentia into which I was born was curbed if not cured, first by the example of my father, who was far from he-mented in the way he treats my mother and other females, and later in my teens and twenties by the advent of militant feminism.

Traces of he-mentia remained, however, until I finally received a massive dose of the kind of kill-or-cure shock-treatment meted out by the Gender Studies department at Sydney University, an institution that now, thanks to its growing majority of female students and staff, is gradually turning from patriarchal to matriarchal.

Or, as I might have put it before I got my he-mentia under control or at least learned to politically-correctly keep such sexist and/or genderist remarks to myself, is morphing from an ivory to an ovary tower.

Which to my mind is a significant improvement, because while females are undeniably prone to prementia and other symptoms of what can justly be termed shementia, this syndrome, as evidenced by spectacular lower rates among its sufferers of everything from crimes of all kinds to suicide, is far less destructive than he-mentia.Not that I’m denying that there are serious mentias that seem to afflict people of both or rather all sexes and genders equally.

As appears to be the case with cementia, for example, a condition in which the contents, attitudes, and aptitudes of sufferers’ minds set like concrete, never, ever to be changed; and the closely-related sedimentia in which “beliefs”, opinions and prejudices all settle to the bottom of minds like so much sludge until something occurs to stir them back up.

Certainly I can feel myself sliding dangerously close to cementia, sedimentia or both from time to time, but fortunately know I can almost always achieve relief, or, if you like, rementia, by resorting to a regimen of such tried-and-true remedies as reading, writing and stimulating conversation.

But when even these fail to cure what’s ailing my mind, as they sometimes have recently, I know I can always resume the university course from which I suspended myself two semesters ago when I overdosed on it to the point of what felt like a case of acute if not terminal academentia, and restore my flagging faculties with some shock treatment in the form of lectures, tutorials, and assignments.

Speaking of “terminal” as I did a couple of lines ago, I see that I’m dangerously close to my word limit. So in closing, I’ll confine myself to discussing just one final example of the many dementias and d’ohmentias with which life confronts every one of us sooner or later if not constantly: doughmentia.

Image result for Najib Razak the crook

He needs to be treated for doughmentia

Love of money may or may not be the root of all evil, and I can’t tell either way from personal experience because most of the money I’ve had and loved I’ve more or less carelessly lost.

Image result for Najib Razak the crook

Malaysia’s First Lady Rosmah Mansor with the concurrence of Prime Minister Najib Razak wants to silence her civil society critics instead of dealing with her narcissism and character flaws

But to judge from my long observations of Malaysia’s UMNO–BN regime and the antics of its money-mad members, supporters and alleged misleader, Najib Abdul Razak, in attempted denial that they’ve sold themselves, the reputations of the race, religion and royalty they so fraudulently claim to support, and the good name and self-respect of the nation at large in return for greater or lesser shares of the countless billions allegedly misappropriated from the 1Malaysia Development Berhad (1MDB) so-called “wealth fund”, doughmentia seems about as dire as evil gets.

And I heartily hope it will prove as politically, financially and personally deadly to them all as dementia that I and far too many of my fast-ageing fellows around the world fear might be our fate.

 

FGV Falls from Grace but Isa Samad Stays: Governance Malaysian Style


June 16, 2017

FGV Falls from Grace but Isa Samad Stays: Governance Malaysian Style

by P.Gunasegarm@www.malaysiakini.com

A QUESTION OF BUSINESS | The latest fallout at Federal Land Development Authority (Felda) controlled Felda Global Ventures Ventures Holdings Bhd (FGV), is just a continuation of the wrong and highly questionable actions of the company since listing in 2012.

Image result for FGV Chairman Isa Abdul Samad

The solution is to simply go back to basics which means that FGV should stick to the business it knows well – oil palm plantations and related processing. It should pay fair prices for related acquisitions, not astronomical sums. And be run by competent professional managers who understand the business and are straight.

But too much damage has already been done by these actions and it will be some time before it recovers completely.

In the latest controversy, FGV board chairperson Isa Abdul Samad announced on June 6 that FGV CEO Zakaria Arshad was to take an immediate leave of absence. He added that it was a board decision.

Apart from Zakaria, FGV chief finance officer Ahmad Tifli Mohd Talha, FGV Trading chief executive officer Ahmad Salman Omar and Delima Oil Products Sdn Bhd senior general manager Kamarzaman Abd Karim were also suspended.

Zakaria hit back saying he had tried to stop hundreds of millions in investments by the company’s board which he described as “ridiculous”.

Amongst the investments, he said, were plans for a 100 million pound sterling (approximately RM551 million) expansion of Felda Cambridge Nanosystems Ltd, a nanocarbon company, which had already lost RM117 million in the last three to four years.

“Now they (the FGV board) want to expand, they need another 100 million pounds. To me this is ridiculous, we’re a plantation company,” he was quoted as saying by The Star.

To understand what is going on, it is necessary to go back into FGV’s short history. While it was listed in mid-2012 with high hopes that it will provide great returns for Felda settlers who hold a direct stake, Felda which holds about a 34% stake and various government institutions including the Employees Provident Fund (EPF), the share performance has been atrocious.

When it was first listed on June 28, 2012 confidence was so high that it opened higher than expected over its initial public offer (IPO) price of RM4.55. Reuters reported: “Malaysian palm oil firm Felda Global surged 20 percent in its trading debut on Thursday (June 28, 2012) as investors cheered on the world’s second largest IPO after Facebook’s botched float and the company pledged stronger profits in the coming months.

“The firm raised US$3.1 billion (about RM10 billion then) in Asia’s biggest initial public offering of this year, running against the global gloom in IPO markets and giving the government a political dividend ahead of what is likely to be a closely fought election (the 2013 general election).”

FGV closed that day at RM5.30, some 16% higher than its IPO price but it has been downhill all the way after that, reflecting poor results and an extreme lack of market confidence in the share following a string of poor purchases over the years, squandering some RM4.46 billion net that came directly to FGV from the issue of new shares from the IPO.

Between June 28, 2012 and its last trading day on Friday, FGV’s share price went from RM5.30 to RM1.66, wiping out nearly seven-tenths of its market value. Even comparing with the IPO price of RM4.55, the drop was over 63% – more than six-tenths of value was lost. The EPF itself lost RM203 million when it sold off some of its investments in FGV.

If one thought that this decline in value is because of a general decline in plantation stocks generally, they are wrong. Bursa Malaysia’s plantation index, which aggregates the performance of major plantation companies, declined just 6% over the same period, or about a twentieth of its value against FGV’s seven-tenths, a rate of decline which was 20 times higher.

Acquisition spree

FGV’s acquisition spree under previous CEO Mohd Emir Mavani Abdullah included the takeover of Pontian United Plantations Bhd for RM1.2 billion, Asia Plantation Ltd for RM628 million and RM2.2 billion for Felda Holdings Bhd, and 836 ha of oil palm land from Golden Land Bhd for RM655 million cash.

It culminated in a deal with the Rajawali Group announced in June 2015 for FGV to acquire a 37% stake in PT Eagle High Plantations (EHP) and 93% to 95% stakes in Rajawali Group’s sugar project, in all worth about US$680 million (about RM2.9 billion) in cash and FGV stock.

Emir was strangely involved in a corruption case earlier this month when an employee of The Star newspaper was charged in the Kuala Lumpur Sessions Court with receiving RM20,000 in bribes. M Youganesparan was accused of receiving the money from Emir at The Intermark Hotel, Jalan Tun Razak about 9.15pm on May 30 this year.

By the time the Eagle High acquisition was announced, FGV needed to borrow money to do the deal as it had exhausted the RM4.46 billion from IPO proceeds. The deal was heavily criticised as being way too expensive, even by the EPF, at an estimated 70% premium to market. Also Peter Sondakh, the founder and owner of the Rajawali group was said to be part of Prime Minister Najib Razak’s inner circle and served as his adviser on Indonesian affairs.

Fortunately CEO Zakaria Arshad, appointed on April 1, 2016 and the same one who is now on a leave of absence, nixed the deal, which was officially aborted in July 2016 after FGV started negotiations to restructure the deal in December 2015. Eventually in December 2016, the Eagle High deal was done with Felda which paid US$505 million (about RM2.2 billion) a quarter less, for the same deal.

Zakaria also cut other merger and acquisition deals saying that FGV should concentrate on the plantation business instead, in all saving FGV at least RM4 billion in spending.

Isa was chairman of both FGV and Felda at this time but was replaced as Felda chairman in January this year by another politician Shahrir Samad, although it was not clear why he was replaced. Isa, during Abdullah Ahmad Badawi’s time as Umno president, was found guilty of money politics in 2005 and suspended from the party for six years. He had to give up his post as UMNO Vice-President and Federal Territories Minister.

Image result for Idris Jala looks FGV

Idris Jala–The Financial Whiz appointed to fix GFV

Now former cabinet minister Idris Jala is supposed to look into this whole mess and make his recommendations. But at the end of the day, the solution is very straight forward. First, appoint people with impeccable credentials to the board and ensure that there is board diversity, independence and honesty.

Don’t just cram them chock full with politicians, often of dubious quality even then, and civil servants who know little or nothing about the corporate world and how it operates. Directors collectively should have expertise which covers all aspects of running a business.

Then pick a CEO with proven credentials and give him a free hand to run the company within the broad guidelines and mandate set out by the shareholders and the board. Make him accountable for set targets.

The needless failure of FGV is that of basic corporate governance. At the heart of this is the hijacking of what could have been a good, solid plantation company by the politicians for their own purpose, in the process screwing Felda settlers, investors and other stakeholders.


P GUNASEGARAM says too much is discussed but too little is done about corporate governance in Malaysia, even for listed companies. What happens with unlisted government companies, he wonders. E-mail: t.p.guna@gmail.com.