Anti-graft agency begins probe into crisis-hit Felda

Malaysian Anti-Corruption Commission officials at Felda Global Ventures' headquarters yesterday, where they collected documents pertaining to the ongoing investigation.
Malaysian Anti-Corruption Commission officials at Felda Global Ventures' headquarters yesterday, where they collected documents pertaining to the ongoing investigation.PHOTO: FOTOBERNAMA

Palm oil giant faces allegations of corruption, abuse of power

KUALA LUMPUR • Malaysian anti- graft investigators began collecting documents at the headquarters of Felda Global Ventures Holdings (FGV) yesterday in their probe into corruption and abuse of power at the world's biggest producer of crude palm oil.

The Malaysian Anti-Corruption Commission (MACC) is looking at several officials at FGV, 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 suspended 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 Datuk Zakaria.

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

Datuk Seri Idris yesterday visited Felda accompanied by several policemen at the same time the MACC officers were there.

Turmoil at FGV could hurt Datuk Seri Najib, who, government sources say, is expected to call a general election later this year.

  • SHARP PLUNGE

  • 70%

    Fall in FGV shares since their stock-market launch in 2012.

  • RM1.65

    FGV's share priceyesterday.

FGV's shareholders, many of them small landowners, form a key vote bank for Mr Najib's ruling alliance in battleground states.

Felda "settlers", or landowners, are the majority voters for at least 54 of the 222 seats in the federal Parliament.

The FGV crisis unfolded on Tuesday when Mr Zakaria's letter to the chairman, Tan Sri Mohd Isa Samad, stating his refusal to step down as instructed by the chairman, was leaked. FGV's board then suspended Mr Zakaria and three others.

Mr Zakaria has denied wrongdoing and called on MACC to conduct its own investigation into FGV, but did not provide any details.

Speaking to reporters yesterday, Mr Isa said FGV was continuing its own investigation into a transaction with a subsidiary that led to the suspension of the four executives.

Mr Isa was a former chief minister of Negeri Sembilan state and a former vice-president of Malaysia's ruling party Umno.

The Felda settlers own shares in FGV, which raised over US$3 billion (S$4.2 billion) in one of the world's biggest listings of 2012.

The shares have dropped 70 per cent since that stock-market launch, hurting settlers.

They have also complained about delayed payments from Felda, which buys the palm fruit the settlers produce on their land.

FGV's shares closed at RM1.65 yesterday, valuing the company at RM5.91 billion (S$1.9 billion). The shares have lost about 6 per cent of their value since Tuesday's suspension of the top executives.

REUTERS

A version of this article appeared in the print edition of The Straits Times on June 09, 2017, with the headline 'Anti-graft agency begins probe into crisis-hit Felda'. Print Edition | Subscribe