The Malaysian Anti-Corruption Commission (MACC) has been urged to investigate allegations of that funds for a water supply project in Pulau Gaya, Sabah was misappropriated.

Gerakan Akar Umbi Umno Malaysia (Gaum) president Zulkarnain Mahdar, who lodged the MACC report today, today said the issue had affected 12,000 residents on the island.

He based his allegation on information obtained from a blog titled "Captain M: The Great Soldier", which also implicated then Rural and Regional Development Minister Mohd Shafie Apdal.

"It involves RM100 million of the public funds. We must know why the project failed and if the state government is aware (of it) or not?" he asked.

The matter is also being probed by the Public Accounts Committee (PAC).

PAC deputy chairperson Dr Tan Seng Giaw said that PAC members had visited the site and was dissatisfied with how the project was being handled.

"We do not know why they have not yet been supplied with clean water when the federal government have given sufficient funds for the project," he said, according to Free Malaysia Today.

When contacted, Mohd Shafie said he would cooperate with MACC investigations and denied any wrongdoing.

"There is no basis to this. No need to comment further, let the MACC investigate," he said.