Law Jenn Dong, a 51-year-old engineer who left Kuala Dimensi Sdn Bhd (KDSB) in September last year, claimed trial to the charges at the Sessions Court here.

He was handcuffed when led to the court by policemen. The charges were:
> nine counts of allegedly cheating the PKA between Sept 29, 2006 and June 5, 2007 to pay KDSB RM46,267,000 by making them believe that electrical infrastructure works for a 33kv system for the PKFZ in Pulau Indah had been completed as stated in the notice of payment, and

> 15 counts of allegedly cheating the PKA into paying a total of RM70,583,000 to KDSB by falsely stating in 15 notices of payments sent between June 30, 2006 and May 30, 2008 that electrical works for a 33kv system for Precinct 2 and Precinct 8 had been completed.

In submissions for bail, Law’s lawyer Tan Hock Chuan argued that the RM1 million bail offered by the prosecution led by Datuk Dzulkifli Ahmad should be reduced in line with that offered by the court to the three accused who were arrested and charged last Thursday.

He added that the aim of bail was not to punish but to ensure attendance of the accused for the trial, which he said Law had done willingly.

“He was out of Kuala Lumpur last Thursday when the others were charged. He called the investigating officer the next day and subjected himself to the legal process,”

Judge Yong Zarida Sazali set bail at RM250,000 and mention for Feb 4.

On Thursday, in the first indictsments by the authorities, former PKA general manager Datin Paduka O.C Phang, KDSB chief operating officer Steven Abok and KDSB consultant architect Bernard Tan Seng Swee of BTA Arkitek were charged a total of 31 counts of cheating and criminal breach of trust amounting to a total of RM380 million.

All three pleaded not guilty.

Tan was charged with jointly committing 24 offences with Law, as well as two more jointly with Abok.

Law was named in a press conference last Thursday by Attorney-General Tan Sri Abdul Gani Patail as being on the list of those who would be charged over the PKFZ development.

The development drew scrutiny when the development costs of the integrated cargo distribution hub and industrial park spiraled from RM2 billion to RM4.6 billion.

> Bernard Tan Seng Swee, 48, of project consultancy firm BKA Architects.

Faces 24 charges of making false claims to the Port Klang Authority (PKA) for electrical works involving a total sum of RM122.267 million.

The offences were allegedly committed between June 30, 2006 and May 30, 2008, with another who is still at large.

The charges were;

> nine counts of allegedly cheating the PKA between Sept 29, 2006 and Jun 5, 2007 to pay turnkey contractor Kuala Dimensi Sdn Bhd (KDSB) RM46,267,000 in believing that electrical infrastructure works for a 33kv system for the PKFZ works in Pulau Indah was completed as stated in the notice of payment, and

> 15 counts of allegedly cheating the PKA into paying a total of RM70,583,000 to KDSB by falsely stating in 15 notices of payments sent between Jun 30, 2006 and May 30, 2008 that electrical works for a 33kv system for Precinct 2 and Precinct 8 had been completed.

Bail set at RM250,000 with one surety for all the charges. Case to be mentioned on Feb 4.

Tan and KDSB chief operating officer Stephen Abok also jointly charged with two offences. They are:

> Cheating the PKA into believing that electrical works for a 33kv system for Precinct 2 and Precinct 8 of the PKFZ project worth RM4,080,000 were completed by KDSB in a notice of payment issued on July 31. 2007 and

> Cheating the PKA into believing that electrical works for a 33kv system for Precinct 2 and Precinct 8 of the PKFZ project worth RM1,337,000 were completed by KDSB in a notice of payment issued on Sept 28 2007.

Stephen Abok was released on a bail of RM250,000 with one surety for both charges. His mention was also set for Feb 4.

> Former PKA general manager Datin Paduka O.C Phang

She was charged with three counts of criminal breach of trust (CBT) of three bank accounts:

> between Oct 1, 2004 and Sept 5, 2005 at the PKA offices of RM98,700,000 of funds in a RHB bank account

> between Sept 30, 2005 May 9, 2006 at the PKA offices of RM21,600,000 of funds in a RHB bank account, and

> between Jun 1, 2005 and Jan 13, 2006, at the PKA offices of RM 134,550,000 in a RHB bank account.

The arrests of Tan, Abok and Phang yesterday mark the first in a series of five arrests to be undertaken by the police and the Malaysian Anti-Corruption Commission over the controversial PKFZ project which had been investigated by the parliamentary Public Accounts Committee.

The PAC had recommended that the Malaysian Anti-Corruption Commission and police investigate Phang and former Transport Minister Tan Sri Chan Kong Choy, who held the portfolio from 2003 to 2008, for criminal breach of trust over the scandal.

In its report, it had highlighted that certain procedures were carried out without the authorisation of the Finance Ministry.

The PKFZ controversy arose after the cost to develop the massive 1000-acre integrated cargo distribution hub and industrial park spiraled from RM2 billion to RM4.6 billion.

How many Malaysians will agree with Gani that these three are the “big fishes” in the PKFZ scandal?

Guilty or otherwise, there can be no doubt that the trio are mere “cogs in the wheel” of the “mother of all scandals” and the authorities concerned have still to bring the “big fishes” to justice.

Gani said that investigations into the PKFZ scandal are ongoing and more people would be brought to book.

What Malaysians want to see are not just the prosecution of the “cogs in the wheel” but the masterminds of the PKFZ “mother of all scandals”.

PricewaterhouseCoopers (PcW) investigations and the Public Accounts Committee (PAC) inquiries have laid building blocks for the full whole sordid tale of the RM12.5 billion PKFZ scandal to be told to Malaysians, right from the beginning of the PKFZ land acquisition in the nineties, and for all those involved in the intricate and complex conspiracy to be revealed.

The Prime Minister, Datuk Seri Najib Razak should “walk the talk” of his commitment to combat corruption and abuses of power by establishing a Royal Commission of Inquiry to investigate and reveal all about the PKFZ “mother of all scandals” or he would have failed his first KPI test of placing “fighting corruption” as one of six priority sectors.

The other two were Steven Abok, chief operating officer of Kuala Dimensi Sdn Bhd, the project’s turnkey contractor, and architect Bernard Tan Seng Swee of BTA Architect, the project consultant. All three pleaded not guilty.

Newsmen had parked themselves at the court since morning to wait for the trio, who were brought to the court at 1.55 pm with Phang wearing a turqoise-coloured dress while Abok and Tan wore face masks. They were not handcuffed.

Phang faced three charges of CBT amounting to RM254.85 million and was granted RM350,000 bail with one surety.

Abok and Tan were jointly charged with two counts of making false claims involving a total sum of RM5.417 million.

Tan is also charged together with another person still at large with 24 counts of making false claims involving a total sum of RM122.267 million.

The PKFZ became controversial after the cost to develop the massive 400-hectare integrated cargo distribution hub spiralled from RM2 billion to RM4.6 billion.

Phang, a former civil servant, was the first woman to head the PKA. She helmed the authority from 2001 until last year.

A parliamentary probe by the Public Accounts Committee last month had recommended that the Malaysian Anti-Corruption Commission and police investigate Phang and former Transport Minister Tan Sri Chan Kong Choy, who held the portfolio from 2003 to 2008, for criminal breach of trust over the scandal.

The PAC probe also highlighted that certain procedures were carried out without the authorisation of the Finance Ministry.

The report said the PAC was informed by the Attorney-General that three support letters issued by Chan and three letters of undertaking issued by Phang were implicitly a form of guarantee from the government to ensure that there would be allocations for PKA to enable it to meet its obligations under the development agreement.

PKA has since filed over a billion ringgit worth of suits against Kuala Dimensi Sdn Bhd and BTA Architects and also sued Phang for breach of duties.

Police have frozen several bank accounts of Kuala Dimensi Sdn Bhd.

The government has also set up an 11-member special taskforce headed by Chief Secretary to the Government Tan Sri Mohd Sidek Hassan to determine misconduct and to ensure the project becomes profitable.

Meanwhile, Attorney-General Tan Sri Gani Patail told a press conference today that the prosecution of the three people “is certainly not the end of the matter but just the beginning”.

He said the prosecution of other individuals will be done “in stages”, adding that a KDSB engineer Low Jenn Dong will be charged soon in connection with this case.

He said his office and the Malaysian Anti-Corruption Commission (MACC) and the police had been on this probe for several months now and that there were “lots of issues involved both legal and factual which are not only complex but require substantial amount of manhours of evidence gathering”.

He said he decided to prosecute the three individuals today as he could not wait for the authorities to complete their investigations into the whole scheme as that would take a long time.

Both Inspector-General of Police Tan Sri Musa Hassan and MACC deputy commissioner Abu Kassim Mohamed were present at the press conference.

Pakatan leaders sceptical about PKFZ arrests

By Syed Jaymal Zahiid

KUALA LUMPUR, Dec 10 — Pakatan Rakyat national leaders were unimpressed and sceptical about today’s arrests made in connection to the RM 12.5 billion Port Klang Free Zone (PKFZ) scandal, calling it a scapegoating exercise where the main culprits still remain free.

DAP stalwart Lim Kit Siang said the arrests were a small move and had yet to prove the federal government’s will to get to the bottom of the scandal that involved bloated land valuations and double charges.

“Although we are seeing some movement, the arrest is a very small piece of a larger picture,” said the Ipoh Timur MP, who has been at the forefront of the Pakatan campaign on the PKFZ scandal.

“And unless there is a greater political will to deal with those responsible for the mother of all scandals and this only touches the surface of the problem,” he told a press conference in Parliament here.

The police, together with graft-busters MACC, today arrested former general manager of the Port Klang Authority (PKA), Datin Paduka OC Phang, along with two others. All three were later charged for criminal breach of trust (CBT) and other offences at the Klang Sessions Courts. The trio were released after posting bail.

So far it is unclear if more personalities — such as former transport minister Datuk Seri Chan Kong Choy or Datuk Seri Tiong King Sing, who controls PKFZ contractor Kuala Dimensi Sdn Bhd (KDSB) — will face any action.

PKR de facto leader Datuk Seri Anwar brahim speaking to reporters in Parliament also shared Lim’s scepticism over the arrests.

“We welcome this move albeit it being a small move but just as what had happened to Perwaja, the smaller fishes were caught while the bigger sharks escape so in the PKFZ case, I hope this is not the beginning of a cover up on the issue,” he said.

Anticipating public doubt, the Attorney-General has said that the arrests of the three will not be the end of the PKFZ probe.

He said more are expected to be arrested and charged this Monday, with one of them being a KDSB engineer.

“TI-M hopes that the public will support the legal defence fund, so that we will not be hampered or deterred in its crucial work,” said TI-M secretary general C I Ngooi in a press release today,.

Ngooi added that the fund had been “overwhelmingly” supported in a TI-M Emergency General Meeting on Nov 7 this year to back the controversial 2009 Global Corruption Report and Low.

Low, who was elected as TI-M president in March this year was forced to quit his post on Oct 6 after receiving heavy criticism over the TI-M report which highlighted the RM4.6 billion Port Klang Free Zone (PKFZ) scandal.

Tiong, who is also the Chief Executive Officer of PKFZ turnkey developer Kuala Dimensi Sendirian Berhad had earlier announced his intentions to sue Low and TI-M over the report which he alleged was “irresponsible”.

Low, who resigned on his own free will, told the media at the time that he had resigned over his failure to consult the TI-M executive committee before releasing the report. Low was also apppointed on June 10 to head the PKFZ Port Klang Authority Ad Hoc Committee on Governance, a post which he still retains.

However, TI-M re-elected him as President on Nov 7.

Ngooi said the suit which was received by Low at his firm today did not specify a specific amount of damages, but sought aggravated and exemplary damages, adding that the suit cited passages from the report, as well as articles published by theSun and the online portal Malaysiakini which referred to the report and PKFZ.

Asked when the fund would be opened to the public, Ngooi said TI-M had yet to set up the fund, adding that it was “moving quickly” to determine what legal requirements are needed before asking the public for help.

“We have not set up the fund yet, but we will be looking at all the legal requirements before setting it up soon,” said Ngooi.

” There may be such possible requirements as ROS approval. We have to move quickly, at present we have legal disbursements and deposits to pay,” he added.

I argued that what is needed is a Royal Commission of Inquiry to conduct a comprehensive and no-holds-barred investigation into the “mother of all scandals” including relevant Ministerial and Cabinet aspects of the scandal instead of trying to sweep the whole issue back under the carpet.

I also posed the following question:

“In the first place, is Mohd Sidek the most appropriate person to head the super task force on the PKFZ scandal?

“Before Mohd Sidek takes up this appointment, he should explain to the Malaysian public why he had failed in the past two years to carry out the Cabinet decision in July 2007 when it resolved 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, that the Chief Secretary should conduct an inquiry as to how the four Letters of Support could have issued unlawfully and to take the necessary disciplinary actions against the culprits who have now landed the country with a RM12.5 billion PKFZ scandal.

“Did Mohd Sidek carry out such an inquiry as not a single culprit had been identified, let alone penalised for the unlawful issue of the four Letters of Support in the past two years?

“Clearly, Mohd Sidek had not carried out the Cabinet instruction or there would not be today a merry-go-round of multiple investigations into the PKFZ scandal, but all without the necessary sweeping powers to get to the bottom of the scandal.

“Can Mohd Sidek succeed where he had failed in the past two years? I hope Parliament is given a specific answer to these questions in the ministerial replies.”

This is the reply that I have received from the Minister in the Prime Minister’s Department, Datuk Nazri Aziz, by way of a written answer as he had promised Parliament during the winding-up of the debate on November 9, 2009 for issues he was unable to reply orally because of the constraints of time.

This is Nazri’s response to my budget speech on the PKFZ scandal:

1.

YB Ipoh Timur mencadangkan agar ditubuhkan suruhanjaya diraja untuk menyiasat skandal Port Klang Free Zone (PKFZ). Untuk makluman Yang Berhormat, Kerajaan belum bercadang untuk menubuhkan suruhanjaya diraja kerana satu pasukan petugas khas telah ditubuhkan bagi mengemukakan cadangan untuk tindakan susulan Kerajaan berhubung laporan audit PKFZ tersebut.
2.

YB Ipoh Timur ingin tahu sama ada Y.Bhg. Ketua Setiausaha Negara telah melaksanakan keputusan Mesyuarat Jemaah Menteri pada Julai 2007 berkenaan 4 surat sokongan oleh Menteri Pengangkutan ketika itu. Untuk makluman Yang Berhormat, Y.Bhg. Ketua Setiausaha Negara telah pun melaksanakan keputusan Mesyuarat Jemaah Menteri yang dimaksudkan iaitu berhubung 4 surat sokongan daripada Y.B. Menteri Pengangkutan ketika itu.

Nazri’s answers are most unsatisfactory and unacceptable, in particular his answer that the Chief Secretary, Tan Sri Mohd Sidek Hassan had carried out the Cabinet decision in July 2007 to conduct an inquiry as to how the four Letters of Support were issued unlawfully and to take the necessary disciplinary actions against the culprits who have now landed the country with the RM12.5 billion PKFZ scandal.

If the Chief Secretary had carried out the Cabinet decision in July 2007, there would have been no need for him now to head any PKFZ special task force into PKFZ scandal, as those responsible for abuse of power, criminal breach of trust and malpractices would have already been brought to court to face the full force of the law.

Last Thursday, Sidek issued his first statement as Chairman of the PKFZ Special Task Force – more than two months after its formation by the Cabinet in early September – stating that it agreed that the Transport Ministry asked the Board of Directors of the Port Klang Authority (PKA) to consider the recommendations by the Corporate Governance Ad Hoc Committee on the PKFZ project created by the Ministry earlier.

Sidek said the recommendations could be implemented without involving any amendments to the law.

This was decided by the Special Task Force in its third meeting held on Nov 2.

Sidek said the meeting was also informed of the action taken by the Royal Malaysia Police and the Malaysian Anti-Corruption Commission (MACC) so far, with the MACC investigation into the PKFZ scandal expected to be completed by the end of the year.

The Cabinet Special Task Force appears to be acting like a postman or reporter than as an alternative to a Royal Commission of Inquiry not only to get to the bottom of the RM12.5 billion PKFZ scandal but to bring to book the culprits for landing the country with the “mother-of-all-scandals”.

If Sidek had carried out the Cabinet decision of July 2007 to take all necessary action against the culprits responsible for the PKFZ scandal, including former Transport Ministers and Port Klang Authority officers, the PKFZ scandal would not have reached the present magnitude. Furthermore, there would be no need for the Cabinet to establish any Special Task Force to do what should have been done under the Cabinet decision of July 2007.

Undoubtedly, one reason why Malaysia’s has suffered the ignominy of the worst ranking and score in 15 years in Transparency International (TI) Corruption Perception Index (CPI) 2009 must be traced directly to the failure of the Chief Secretary in discharging the task entrusted on him by the Cabinet in July 2007 with regard to the PKFZ scandal.

TI-M president Datuk Paul Low said Malaysia’s ranking had slipped to 56th position this year from 47th last year, out of 180 countries surveyed.

However, Prime Minister Datuk Seri Najib Razak’s moves to initiate reforms in some institutions, especially the judiciary, and the setting up of the Malaysian Anti-Corruption Commission, to make them more independent, transparent and accountable, was the way forward for the country, he said at a press conference to announce Malaysia’s position in the Transparency International Corruption Perceptions Index 2009, today.

He said Transparency International Malaysia believed that the way forward for the country was to seriously combat corruption and to make government decisions and transactions more visible and transparent.

Low, however, suggested that the government should be more transparent in its procurement process by implementing “integrity agreement” with vendors to act as preventive measures to curb corruption.

Low said Malaysia’s decline in ranking in CPI 2009 of 0.6, from 5.1 in 2008 to 4.5 this year, “may be attributed to the perception of little progress in combating corruption, and lack of political will in implementing effective anti-corruption measures”.

Examples giving rise to the concern were the Port Klang Free Zone (PKFZ) fiasco and the auditor-general’s annual report highlighting extraordinary public procurement abuses, he said.

“However, there are positive signs. The PKFZ fiasco is being actively and vigorously investigated, police reports have been made and suits have been taken against certain parties, and corrective measures have been taken.

“The United Nations Convention Against Corruption (UNCAC) was ratified in September 2008. Integrity is a Key Result Area for the government, with the CPI as a key productivity index. The prime minister has formed a high-level task force to study and make recommendations for action to be taken on the auditor-general’s 2008 report,” he said.

Meanwhile, DAP veteran and Ipoh Timur Member of Parliament Lim Kit Siang views Malaysia’s drop in ranking as a national shame.

“I have no doubt that the death of DAP political aide Teoh Beng Hock on July 16 at the building housing the Malaysian Anti-Corruption Commission building in Shah Alam and the MACC’s targeting Pakatan Rakyat representatives as major factors for Malaysia’s worst-ever TI CPI ranking and score,” he said in a statement.

DATUK Zaharah Shaari was Transport Ministry (MOT) secretary-general from June 1999 to July 2005. She was already serving in the ministry before her promotion to secretary-general. Before her posting to the ministry, she served in the Treasury for 10 years. She appeared before the committee on Aug 13 from 10am to 12.20pm.

On the land acquisition
Zaharah said she was only notified about the PKFZ project during the land acquisition phase. She was informed that the government agreed to buy the 999.5 acres (399.8ha) from a developer named Kuala Dimensi Sdn Bhd (KDSB) for the purpose of having a distribution park to support Port Klang as a load centre.

Zaharah said she felt the government should have acquired the land through the National Land Acquisition Act, adding she found KDSB’s asking price high and ought to be scrutinised because it was much higher than what was offered by the valuation department.

“However, the decision to buy the land in principle was made by the government before I was made secretary-general. At that time, the land offered was about half the portion of the total area. Subsequently, the company offered the balance of the land to the government for the purpose of (building a) distribution hub,” said Zaharah.

She did not mention the price of the original evaluation but it was reported that Port Klang Authority (PKA), which comes under the purview of the MOT, insisted to buy the land at RM25, instead of RM10.

Zaharah told PAC that after she retired in 2005, she was not directly involved in the project but admitted that she would intervene on the request of the then Transport Minister (Tan Sri Chan Kong Choy).

“I would be asked to intervene when there are problems pertaining to policies but I was not informed of all the sequence of events. The actions taken by MOT and PKA were dealt directly by the desk officer as it (also involved) the maritime (department to make the) decisions. Bottom line is, I got involved when my help was required. I only monitored it in general,” she said.

Zaharah claimed during her tenure as the MOT’s secretary-general, there were no reports from the ministry’s representatives on the PKFZ project.

“When I became the secretary-general, I did send notes to my officers to report and update me on what was discussed in the meetings but not all officers did that and it was difficult to monitor them.

“I was only informed by the desk officers from the maritime department. When I found out the problems (the land acquisition), I took the initiative to find out what the problem was,” she added.

Ledang (BN-Umno) MP Hamim Shaari then asked whether the issue was discussed during post-cabinet meetings. Zaharah said: “It was not. But from time-to-time, there were mentions about this project. Once the cabinet decides, the minister will take it up in Cabinet meetings on the decisions and the implementations.”

PJ Utara (DAP) MP Tony Pua asked whether she was involved in the discussions with the Valuation and Property Service Department as the valuations given by the department differed.

The first valuation priced the land at RM10 per sq ft, second valuation at RM21 per sq ft and the third at RM25 per sq ft.

He also asked whether Zaharah, apart from suggesting that the government acquired the land through the Land Acquisition Act, recommended other measures to protect the interest of the government.

Zaharah reiterated that she felt the best way for the government to acquire the land was through the Land Acquisition Act and felt KDSB’s asking price was high as it was much higher than what was offered by the valuation department.

“However, I was later informed that the government agreed with the pricing and negotiation was being done with the company (KDSB), subjected to Treasury approval,” said Zaharah, adding the sale and purchase agreement of the land was signed between 2001 and 2002.

Zaharah also said the proposal to use the Land Acquisition Act did not go through as the Selangor government did not agree to it.

“I am also not aware of the details of the agreement signed. I thought the price of RM25 per sq ft was inclusive of the infrastructural cost,” she said.

On the letters of support
Zaharah said she was given the first letter by the then minister Tun Dr Ling Liong Sik. He apparently had asked her to examine the letter to ensure there were no financial implications involving the ministry or the government.

“Tun Dr Ling Liong Sik did receive a draft letter for him to sign and a special officer in his office handed it to me after a post-cabinet meeting and informed me that the minister suggested sending a letter of support,” said Zaharah.

However, she said she advised the minister not to send the letter in the original form as the minister did not have the right to sign a letter of guarantee.

Kepong (DAP) MP Dr Tan Seng Giaw then asked if she was aware that the first letter sent and signed by the minister was regarded by the Malaysian Rating Corporation Berhad (MARC) as a guarantee.

“It was my sincere belief at that point of time that it was not a form of guarantee because the letter went through our legal officer,” said Zaharah.

“But in actual fact, it was a guarantee, did you know that,” asked Tan.

Zaharah reiterated that she was advised to revise the letter so it would not carry any guarantee or financial implications to the government.

She also said she was not informed that MARC regarded the letter as a guarantee.

Zaharah explained she had never seen any other letters until she was called to face PAC, adding she was unsure about the reports in the media regarding three support letters.
“I was only given one letter, the letter which Tun Dr Ling Liong Sik sent. That letter which was filtered by me after I had discussions with legal officers and senior officers in my ministry,” she added.

Zaharah said she only found out about the second letter sent by former Transport Minister Tan Sri Chan Kong Choy when she was informed she would be called by PAC. She said the ministry only gave her one copy of the letter dated in 2004.

“I did ask if other officers received the letters because I am curious to know since it was (during) my time but I was informed by the ministry that even other officers did not know about the letters,” said Zaharah.

On the financial problems faced by PKA
Zaharah acknowledged that PKA did not have the financial resources to support the project based on the Auditor-General (A-G)’s report in 2004. When asked if a special committee was formed by the ministry to discuss the outcome of the A-G’s report, Zaharah agreed but explained she did not chair the meeting.

“According to the procedure, the deputy secretary-general is the one who should chair the meeting and not the secretary-general. Every minutes of the meeting on the report is sent to the secretary-general but I can’t recall how the issue was discussed in the meetings,” said Zaharah.

Initially, Ong was scheduled to appear before Ling but due to unavoidable circumstances, Ong’s appearance before the committee was moved to a later time.

>> On land acquisition
Ling refuted claims that his ministry had direct involvement in the valuation and final pricing of the land embroiled in the Port Klang Free Zone (PKFZ) scandal. DAP’s PJ Utara MP Tony Pua asked why the Port Klang Authority (PKA), which is under Ministry of Transport (MOT), insisted on buying the 999.5 acres (399.8ha) at RM25 per sq ft, instead of RM10.

It also appears that the Attorney-General’s (A-G) Chambers and the Ministry of Finance (MoF) had strongly recommended the Land Acquisition Act to be used to acquire the plot of land.

“You were actually recommended by the valuation department supported by the (MoF) as well as the A-G. Is there a reason why the higher price was supported,” asked PAC member Pua.

To this, Ling said it was hindsight.

“After the whole thing blew up, we all try to refresh our memories as to what happened … yes, A-G said buy it out of land acquisition at RM10.60 or something like that. Then the Selangor state government said no because there is already a Development Order on that piece of land,” said Ling.

“You cannot use the Acquisition Act to acquire a piece of land which has a Development Order on it.

These are the sort of the things we read about but those are technical things which we do not know which are right or wrong,” he added.

When probed further on MOT’s level of involvement in the acquisition of land, Ling maintained his stand by saying neither MOT nor the minister (then Ling) were involved in the final approval of the pricing of the land at RM25 per sq ft.

“As far as (I’m) concerned, no. The minister is not involved. The main agency would be Treasury. They are the ones who are in charge,” said Ling.

>> On the bonds
Ling claims he does not remember if there were other options to finance the land acquisition process.
According to a PricewaterhouseCoopers (PWC) Report in 2001, the cabinet decided that the project would have to be self-financed and that PKA is supposed to issue the government guaranteed bonds but it was subsequently changed to PKA buying from Kuala Dimensi Sdn Bhd (KDSB) on a deferred payment and pay interest.

“Was it during my time, did I sign anything to approve that action? Because whatever we approve must have gone through due process,” said Ling.

PWC reported that on June 12, 2001, MoF directed that the land should be compulsorily acquired and recommended the development cost be funded by PKA issuing government guaranteed bonds.

However, in the end, the land was bought without the compulsory acquisition, which means the land was bought directly and the funding was from the seller at a higher interest rate of 7.5% instead of government-issued bond at an interest rate of 4.2%.

PKA had paid RM1.09 billion for the land to be settled via deferred payments over 15 years on the basis that PKA was supposedly backed by a government guarantee.

Based on the supposedly government guarantee, KDSB sold bonds worth RM1.31 billion. KDSB was then awarded the contract by PKA to develop the land, leading KDSB to issue bonds amounting to RM1.4 billion.

Two more (batches of) bonds worth more than RM1 billion were issued to finance the construction.

>> On KDSB being awarded the contract KDSB, a company owned by Datuk Seri Tiong King Sing who is the current Parliament’s Backbenchers’ Club chairman, was first awarded the contract in February 2007. PKA signed a development agreement with KDSB to develop the first 400 acres of PKFZ. When asked the reasons why KDSB was chosen without opening competitive bids, Ling did not comment as he said he could not recall the exact details of the entire process and was not prepared to comment on the matter.

When asked if he had heard of KDSB before he left the ministry, Ling said “I may have heard about it”.

He also said he did not remember using the services of KDSB’s group of companies, such as Wijaya Baru Sdn Bhd.

“I have very vague memory of KDSB, to say I never (have) heard of KDSB would be untrue but to say that I remember what they were doing is not true,” said Ling.

>> On PKA former general manager Datin Paduka O.C.Phang Ling admitted that Phang was a reliable officer but refuted claims that most of the decisions on PKFZ was made by Phang and by-passed Ling.

“I would not choose to make any comment on something I’m not sure of. That is too serious,” said Ling, adding that he met Phang every week during post cabinet meetings.

Ling, however, agreed that the management of PKFZ and PKA was largely left to its boards.

“Yes, there was a board of PKFZ, there was a board of PKA and there were all the other ministries and agencies represented were also knowledgeable on financial matters. A lot of these things have been done by them,” he said.

>> Questions to which Ling’s response was: “I don’t remember/know/recall”

Datuk Seri Azmi Khalid
PAC chairman Datuk Seri Azmi Khalid: Would you recall … There was a point where it was mentioned that even RM25 (per sq ft); it was still viable in terms of …?

Ling: It is a little complicated … To pinpoint exactly when, where, how and why, I think it is a little bit difficult.

Selayang (PKR) MP William Leong Jee Keen: Tun, just for clarification. You were saying that you identified 1,000 acres and that you need to have it … Are you saying that this is the only 1,000 acres in Pulau Indah or were there also other available pieces of land if the price is too high …?

Ling: What I meant was this was one piece that was offered to us. Whether there were other pieces, I really do not know.

Kapit (BN-PBB) MP Alexander Nanta Linggi: … can you remember at what stage the project was implemented up to the point when you left the ministry?

Ling: … it was May. That’s the last thing I remember of that project because you (I) have nothing else more to do with it.

Azmi Khalid: At that stage when you left, what stage was the development? …

Ling: I really wouldn’t know.

Leong: Tun, according to the PriceWaterhouseCoopers Report in 2001, the cabinet decided that the project would have to be self-financing … Wouldn’t it be cheaper for PKA to have gone through the process of their government guaranteed bond?

Ling: Was it during my time? Did I sign anything to approve that action? (Ling reiterated that the approvals for the land acquisition had to go through the right processes and the right agencies.)

Leong: That is my point, in the due process, when it came to your ministry’s table for you to also make a decision, do you recall this issue?

Ling: Is there evidence that it came and that happened?

Kota Belud (BN-Umno) MP Datuk Abd. Rahman Dahlan: Tun, are you aware that there were other options to finance the land acquisitions. Are you aware that there was a cheaper way of doing things?

Ling: I can’t remember.

Azmi Khalid: KDSB as the developer only needed a capital to develop the site and it could have been raised either through the government guaranteed bonds or through their own channel. My question is, was the ministry informed of any of the decisions?

Ling: I really can’t remember.

Kepong (DAP) MP Dr Tan Seng Giaw: Tun, can you confirm that the idea (PKFZ) was conceived actually before 1999 …?

Ling: I am not sure.

Tan: You’re not sure huh?

Ling: I am not sure because I became a minister in 1986 and anything that happened after 1986, of course like you (I) cannot be sure (to) pinpoint (if) it is 1987, 1988, no, I must apologise, I cannot remember.

Tan: Leading to the time on May 28, your last day, you said that a letter was handed, who wrote that letter for you?

Ling: I can’t remember but I remember I signed the letter that was passed to me.

PJ Utara (DAP) MP Tony Pua: Why were there no competitive bid (apart from KDSB) and what was the strength of KDSB …?

Ling: Frankly, I cannot remember those details. I would like to know myself but there must have been certain grounds.

Pua: Tun, is it the usual process to award to a single contractor or is it (usual) to have a competitive open tender? …

Ling: I am not prepared to comment because I really cannot remember the circumstances.

Tan: How many times did you visit Jebel Ali?

Ling: You know, I cannot remember but I visited Jebel Ali at least once.

Pua: As a matter of record, are there any benefits which under KDSB and its owner Datuk Seri Tiong King Sing and the group of companies like Wijaya Baru Sdn Bhd … which you have taken? Example flights or entertainment?

Ling: Nothing at all that I can remember.

Tan: Tun, you said you have heard of KDSB. During your time, was there any attempt by KDSB to develop the infrastructure of Pulau Indah?

Ling: I cannot remember.

Tan: Tun, did you know that the bonds would be issued?

Ling: I may have heard of it but…

Tan: You could not recall.

Ling: No. No.

Azmi Khalid: The bond was issued after your time. Am I right?

Ling: The only possible connection was through that Letter of Support which we gave a reply after due consultation with the secretary general and legal officers.

Tan: Were you aware that in 1999, the cabinet made the decision that it (PKFZ) should be self-financed when they approved that RM1.9 billion (loan) for that project?

Ling: Did they ever approve that RM1.9 billion?