PKFZ: Damning Disclosure

A day before the report on the controversial Port Klang Free Zone (PKFZ) project is due to be made public, Barisan Nasional MPs were briefed by the Port Klang Authority (PKA) yesterday and told that the cost of the project is now expected to be more than RM10 billion*!

The Sun also reports, here, that among the findings of Price Waterhouse Coopers (PWC) audit report are that:

» No proper studies were undertaken before embarking on the project;

» Major decisions on the project were made without prior approval of PKA board;

» The PKA chairman and general manager entered into agreements without seeking the advice of the relevant government authorities;

» There was a failure to exercise adequate governance and implement checks and balances in the implementation of the project.

(These are things I have been frothing at the mouth harping for some time).

The report also detailed a series of conflict of interest situations, which include:

» Sementa assemblyman Abdul Rahman Palil was both the Pulau Lumut Development Co-operative (KPPL) chairman and a PKA director in 2002 when the land for PKFZ was sold by KPPL to PKA;

» Rashid Asari & Co, the legal firm retained by PKA, was also the same firm overseeing the inking of the sales and purchase agreement between KPPL and turnkey contractor Kuala Dimensi Sdn Bhd (KDSB).

(Interestingly, current BN Backbenchers’ Club chairman, Bintulu MP Tiong King Sing holds a controlling stake in KDSB. Former UMNO Treasurer Azim Zabidi is also a director of KDSB!)

One contributory aspect to the PKFZ mess, sources added, was that several Finance Ministry regulations on transparent accounting practices were not complied with and that the advice of the Attorney-General (A-G) was not sought.

The audit report also paints a troubling picture of officials in the Transport Ministry, noting that so-called "letters of support" signed by a former Minister of Transport for the issuance of the bonds could be construed as a guarantee and that PKA would have to meet its financial obligations under such an arrangement.

The PWC report is expected to be made public today, with strong evidence of massive corruption, shameless cronyism and blatant abuse of power by those involved. I say we throw the book at them, make 'em walk the plank, or whatever.

* I was told that if nothing is done quickly, this may even balloon to RM12 billion!

UPDATE at 1930 hrs: In a breaking news, Malaysiakini reports, here, that the audit report into the scandal-hit Port Klang Free Zone (PKFZ) was not released today as scheduled, due to “technical reasons”. PKA chairman Lee Hwa Beng has now put the blame on PWC which he says has "restricted access" to the report.

Didnt these morons specify the terms of reference of the audit?

My sources tell me that all that PWC insisted was that the report should not be used against them and that they are not responsible for the accuracy of the documents made available. This seems pretty reasonable to me under the circumstances.

I urge the Minister of Transport, Chairman and GM of KPA to resign ... NOW !