LETTER | Transparency International Malaysia (TI-M) is concerned with the ongoing and seemingly endless saga of malpractice, corruption and breach of trust and duty cases lately affecting Felda – the last case reported being the questionable Felda “Semarak” land transfer deal.

In fact, the year 2017 can be perhaps be named as the “Felda Year” for the series of news of happenings which has caught the attention of us average Malaysians. 

It appears that it is not only Felda investors (including the hardworking settlers and planters) and the public who are not happy with these cases – discontent seems to be seen from even within the Umno and BN circles.

It is believed that besides Khazanah and Permodalan Nasional Berhad (PNB) groups of companies, the government-linked company (GLC) sector is the biggest source of threat to financial stability due to their being closely linked to political parties, and fraught with lack of good governance and transparency. There are also allegations and suspicion of widespread favouritism, cronyism and corruption in such corporate entities.

Lately, Felda Global Ventures Holdings Bhd (FGV) has taken drastic action by appointing professional subject matter experts to strengthen the composition of the FGV board and senior management.

But to actually make a change, there must be true and fearless intent to make sincerity and integrity an integral part of the corporate culture by setting the “tone at the top”.

To recap the sad narrative - the year 2017 started with the hopeful appointment of a new chairperson. The appointment was supposedly in line with the government’s desire to strengthen and solidify Felda’s leadership. Such noble intentions were very quickly called into question.

In April, Felda Investment Corporation Properties Sdn Bhd (FICP), a special purpose vehicle of Felda, acquired 37 percent of loss-making PT Eagle High Plantation Tbk. Settlers, analysts and investors showed their disapproval towards this acquisition done at a very high premium with a price that lacked financial and commercial justification.

A few months later, Felda’s current chairperson said Felda was merely an “intermediary” for the Malaysian government in the acquisition. Is this how Felda is to be viewed – an intermediary of the government?

Subsequently in June 2017, there was a management crisis at FGV where the MACC investigated several company officials for alleged corruption and abuse of power. The prime minister’s office also got involved, asking a former cabinet minister to look into the suspension of FGV’s top executives.

Its CEO denied wrongdoing and refused to step down as instructed by the then chairperson.

Shortly afterwards, FGV announced the resignation of the chairperson Mohd Isa Samad from the company and its subsidiaries and later was appointed the acting Land Public Transport Commission (Spad) chairperson. His appointment has continued to raise eyebrows amongst the public, bearing in mind his questionable “track record” in Felda.

In August, MACC arrested the said former FGV chairperson in a corruption investigation into FICP’s purchases of two hotels in London and Kuching between 2013 and 2015, said to be above their market value. Until today there has been no decision made yet on this case.

Later in Dec 2017, to cap the end of an eventful year for Felda, it was reported that there was a transfer of title for Felda’s 16-hectare land (the old Felda headquarters, Anjung Felda and Wisma Felda) at Jalan Semarak in Kuala Lumpur for which Felda did not receive a single sen.

The present Felda chairperson was reported to have described the matter as a "dubious deal" and discovered it in Jan 2016. On Dec 23, 2017, the prime minister vowed action to be taken against any negligence or misconduct in the land ownership transfer.

Due to the seriousness of the scandal, the prime minister should impose a deadline on the police and the Attorney-General’s Chambers to complete investigations on this “dubious deal” which has taken such a long time to surface. They must take action without fear and favour.

To be sure the rakyat are watching and will judge to see whether all these current cases will be allowed to proceed with due legal process, or whether they will take a sudden turn and end up like other lost cases which were announced with much fanfare, only to end with a whimper. If this happens, the rakyat will surely suspect a “cover-up” and abuse of legal process and failure of the rule of law.

TI-M strongly feels that the federal government should appoint a forensic auditor to conduct a full forensic audit on both Felda the holding company and its subsidiaries to ensure that if any malpractice has been found to have taken place, it should be looked into and punitive actions taken against the officers involved.

The public has a right to know, since Felda is a government agency which is funded by taxpayers’ money and the hard labour of the Felda settlers, and as such should be properly managed. A corporate entity which is not properly managed and with no proper corporate governance in place will never be sustainable in the long run.

GLCs are recruiting top talents, for example, previous corporate leaders, retired government servants and others for their boards for experience, expertise or networking purposes and not political cronies. Institutional investors, corruption and credit rating agencies are also watching to see how serious Malaysia is in tackling corruption of this nature in GLCs.

No person should take advantage of their position in Felda and its subsidiaries to commit malpractice for their own benefit and be let free without any criminal charges against them and whosoever they may be acting for. Only a conviction and deterrent punishment action against such perpetrators will help to ensure no recurrence of such scandals in the future.

What will 2018 be for Felda? The rakyat wants to see a “real clean-up”, accountability to the law for the wrongdoers and restitution for any losses from wrongdoing. Will the government deliver? Rest assured the rakyat are watching and waiting and will make their judgment.   

AKHBAR SATAR is president of Transparency International Malaysia.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.