KUALA LUMPUR, Oct 8 – The Port Klang Authority (PKA) today filed a civil suit against its former general manager Datin Paduka OC Phang for breach of duties in connection with the scandal-plagued Port Klang Free Zone (PKFZ) project.
PKA chairman Datuk Lee Hwa Beng alleged in a statement today that Phang had failed to comply with Treasury guidelines and safeguard PKA’s interest when entering into agreements for the construction of the PKFZ project.
“OC Phang caused PKA to enter into key agreements, which were not referred by her to the PKA board members for deliberation and approval, despite having full knowledge that such agreements would cause PKA financial distress as PKA was not in a position to finance the project,” Lee contended in his statement.
The suit against Phang is the latest legal action undertaken by Lee in his attempt to sort out the financial mess in PKFZ which could end up costing taxpayers more than RM12 billion by some estimates.
Last month, PKA filed a RM920 million lawsuit against Port Klang Free Zone (PKFZ) main contractor Kuala Dimensi (KDSB) Sdn Bhd and BTA Architect.
This comes after it filed a separate RM720 million lawsuit against KDSB a week earlier, bringing the total amount being legally disputed to RM1.64 billion.
A large chunk of the RM920 million lawsuit consists of claims allegedly made by KDSB worth some RM837 million for monsoon drains, water supply works and others.
In the RM720 million lawsuit, PKA is disputing the imposition of interest in the PKFZ land purchase as well as the wrong computation of interest which may have arisen. The total sum of dispute may amount to as high as RM720 million.
The land had been sold to PKA at RM1.088 billion at the rate of RM25 per square foot on a “special value” basis. The balance in the purchase price was to be paid by PKA on a deferred payment basis.
In the latest suit, Lee also accuses Phang of not addressing the financial predicament of PKA in an appropriate and prompt manner.
Besides that, Phang was also accused in the suit of breaching her fiduciary, contractual and common law duties to PKA.
In August, PKA also lodged a report with the Malaysian Anti-Corruption Commission (MACC) over an alleged conspiracy by five parties, including Phang, to commit wrongdoing in the development of the PKFZ project.
The five parties named by PKA were Phang; Datuk Seri Tiong King Sing, the president and CEO of KDSB; KDSB and its directors, servants and agents and BTA Architect; and Bernard Tan Seng Swee, the consultant appointed for development works for PKFZ.
In early September, Phang made her only statement on PKFZ to the Public Accounts Committee (PAC) in Parliament in which she told the panel she did not understand the concept of cash flow projection.
Her remarks to the PAC resulted in the panel describing the management of the project as being “very weak.”
The PKFZ project was originally projected to cost less than RM2 billion but may now end up costing over RM12 billion by some estimates and had to be rescued with a RM4.6 billion government loan in 2007.
Several efforts have been made to get to the bottom of the woes facing the troubled transshipment hub including a special task force set up by PKA which was superseded with a new “super” task force announced by Prime Minister Datuk Seri Najib Razak recently.
The PKA task force in its report had claimed breaches in duties, including by the former Transport Minister Chan Kong Choy, and a possible conspiracy between external contractors and insiders to harm PKA, the developer of the PKFZ.
Chan, who served as minister of transport for five years beginning in 2003, was alleged in the report to have failed to comply with treasury guidelines and also failed to table proposals to the Cabinet, instead seeking approvals directly from then-prime minister, Tun Abdullah Ahmad Badawi.
He was also alleged to have failed to wait for a master plan for PKFZ to be ready and ignored a recommended mixed development strategy, pushing instead for PKFZ to be developed in a single phase.
Phang was found by the task force to have approved “fraudulent” claims made by KDSB.
The latest lawsuit comes at a sensitive time just ahead of this weekend’s MCA EGM in which Transport Minister Datuk Seri Ong Tee Keat is fighting for his political life.
Tiong has alleged that he made a RM10 million cash donation to Ong last year and this is now the subject of a MACC probe.
Ong has also admitted taking free rides on KDSB’s private jets while the company was being probed over the scandal.
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MoF approving & handling all those payments, they can't run away from being accountable !!!
- MACC/PDRM shall conclude there is not enough evidence
or AG shall later conclude no case to be prosecuted
or those guilty shall be acquitted by the tainted court
or those guilty shall win his appeal at a tainted higher courts
or those guilty shall get royal pardon as a last resort
Government machinery are all serving as a tool for UMNO BN !!!
From executive to judiciary's CJ Zaki Azmi, AG, Police IGP, MACC, EC, MCMC and even exploiting the Monarchy, UMNO held it all from top to bottom & inside out!!!