Malaysia: Anti-graft officials conduct corruption probe at giant palm oil company
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Malaysia: Anti-graft officials conduct corruption probe at giant palm oil company

MALAYSIAN anti-graft investigators began collecting documents at the headquarters of Felda Global Ventures Holdings (FGV) on Thursday in their probe of corruption and abuse of power at the world’s third-largest palm oil company.

The Malaysian Anti-Corruption Commission (MACC) is looking into several FGV officials, following the suspension of the firm’s chief executive officer, chief financial officer and two other executives earlier this week.

A MACC spokesman said the anti-graft agency was at FGV’s offices in Kuala Lumpur “to collect supporting documents” following a meeting with FGV chief executive Zakaria Arshad on Wednesday.

The investigators could seize laptops and computers as well, he said, declining to give details on what was discussed with Zakaria.

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An FGV source, requesting anonymity, said MACC officials also want to meet chairman Mohd Isa Abdul Samad at the company’s offices.

Speaking to reporters on Thursday, Isa said he was willing to meet the anti-corruption investigators if asked. He said FGV was continuing its own investigation into a transaction with a subsidiary that led to the suspensions of the FGV executives.

Isa was a former chief minister of Malaysia’s Negeri Sembilan state and a former vice-president of the country’s ruling party, the United Malays National Organisation (Umno)

Prime Minister Najib Razak’s office stepped into the boardroom spat on Wednesday, asking a former Cabinet minister to look into the suspension of FGV’s top executives.

NAJIB

Najib, who is expected to call elections later this year, has stepped into the boardroom spat. Source: Reuters

Turmoil at FGV – whose biggest shareholder is the state-owned Federal Land Development Authority (Felda) – could hurt Najib, who government sources say is expected to call elections later this year. FGV’s shareholders, many of them small landowners, form a key vote bank for Najib’s ruling alliance in battleground states.

Felda “settlers”, or landowners, are the majority voters in at least 54 of the 222 seats in the Parliament. They own shares in FGV, which raised over US$3 billion in one of the world’s biggest listings of 2012.

The shares have dropped 70 percent since that stock market launch, hurting settlers. They have also complained about delayed payments from Felda, which buys the palm fruit the settlers produce in their land.

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FGV’s shares fell 0.6 percent on Thursday to RM1.65 per share, valuing the company at RM5.91 billion (US$1.39 billion). The shares have lost about six percent of their value since Tuesday’s suspension of the top executives.

The FGV board has said a deal with Dubai-based palm oil buyer Safitex was at the heart of the company’s internal investigation and Safitex owes an FGV unit about US$11.7 million as of 2016.

The FGV crisis unfolded on Tuesday when CEO Zakaria’s letter to the chairman, stating his refusal to step down as instructed by the chairman, was leaked.

FGV’s board then suspended Zakaria and three others. He has denied wrongdoing and called on MACC to conduct its own investigation into FGV, but did not provide any details. – Reuters