Malaysian anti-graft body to probe corruption claims at Felda Global Ventures

Pauline Gross
June 7, 2017

He refused to implicate anyone, including FGV chairman Tan Sri Mohd Isa Samad who had told him to step down, or the reason why would anyone want him out.

- Malaysia's Felda Global Ventures Holdings, the world's third largest plantation operator, said on June 6 that it had suspended its chief executive and chief financial officer pending the investigation of "certain transactions" at one of its subsidiaries.

He welcomed the Malaysian Anti-Corruption Commission (MACC) to investigate FGV, and added that he was willing to cooperate to prove his innocence.

A board committee will take on the functions of the CEO in the interim, the company said, adding that CFO Ahmad Tifli Mohd Talha would be replaced by Aznur Kama Azmir, the group's financial controller for its plantation sector. The management crisis deepened on Wednesday with the national anti-graft agency saying it will soon investigate several company officials for alleged corruption and abuse of power.

Idris, who served as a minister in the PM's department, is known as a turnaround specialist in Malaysia.

Felda "settlers", or land owners, are the majority voters in at least 54 of the 222 seats in the parliament. FGV's share price has declined by nearly two thirds on the local stock exchange since its listing in 2012.

Shares of FGV fell about 1 per cent initially on Wednesday before rebounding to close up 2.5 per cent.

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"The news is bad to FGV and it may derail FGV's restructuring efforts", TA Securities said in a research note following Zakaria's suspension. "I've been entrusted with managing the company well and when I enforce it, then this is what happens", Zakaria said.

He took over in April previous year from Mohd Emir Mavani Abdullah, who was replaced after a failed controversial deal in 2015 to buy a stake in Indonesian palm oil firm PT Eagle High Plantations Tbh.

FGV Trading CEO Ahmad Salman Omar and Delima Oil Products Sdn Bhd (DOP) senior general manager Kamarzaman Abd Karim were also forced to take leave of absence.

Zakaria has denied breaching corporate governance practices to allegedly allow Safitex to purchase palm oil products without a letter of credit, which reportedly resulted in delayed payments to the FGV unit.

"FGV will continue its business as usual", the company said in a filing to the stock exchange.

According to Isa, the issue surfaced when its external auditor Pricewaterhouse-Coopers (PwC) discovered some alleged discrepancies in the dealings between DOP, a subsidiary of FGV and Dubai-based Safitex, which was reported to the internal audit, prompting an investigation.

Other reports by GizPress

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