KUALA LUMPUR (May 21): Felcra Bhd’s board had approved a RM50 million investment in Public Mutual Bhd in 2014, but its then chairman Datuk Seri Bung Moktar Radin informed the Finance Ministry that the amount invested was RM150 million, the Sessions Court heard today.
Datuk Seri Dr Mohamad Isa Hussain, 61, who was then the Treasury’s deputy secretary-general for investments, told the court that he was appointed to the Felcra board in 2010 as a representative of Minister of Finance Inc (MoF Inc) and in November 2014, he was invited to a board meeting.
“In the board meeting, held on the night of Nov 24, 2014, Public Mutual held a briefing on getting a better return for Felcra funds which are kept in a fixed deposit account with a 4% return.
“Besides Bung and myself, the others present were fellow board members Datuk Seri Ibrahim Muhamad, Datuk Baharum Mohamad, Datuk Abdul Fattah Abdullah, Datuk Ismail Kasim, and Ramlee Abu Bakar as Felcra chief executive officer and others.
“The board agreed to the RM50 million investment with Public Mutual provided that approval is gained from MoF Inc,” he said at the graft trial of Bung and his wife Zizie Izette A Samad. The couple is charged with accepting RM2.8 million in bribes to obtain approval for Felcra to invest RM150 million in Public Mutual Bhd’s unit trust.
Replying to Deputy Public Prosecutors Datuk Fariz Gohim and Mohd Sophian Zakaria, Isa said that as the MoF Inc representative, he was present at the board meeting to ensure there would be a good return on the investment.
He added that at Felcra’s request, Bung drafted a letter dated March 3, 2015 addressed to then Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, in which he stated that the amount invested was RM150 million, instead of RM50 million.
“The letter was signed by Bung as I can identify his signature. The letter was processed by my officer Asri Hamidon for a Treasury secretary-general memo to be prepared. I recalled that the sum of RM150 million was the sum agreed upon in the Nov 24, 2014 meeting,” he said.
“I do not know if the sum had been altered or is not the same as was agreed in the board meeting on Nov 24, 2014,” he told the court, adding that subsequently MoF Inc approved the release of the fund
Isa said that sometime in August 2015, a review of the investments was done as it was found to be not encouraging.
As chairman of the Felcra audit team, Isa said he raised the matter to Felcra’s audit committee on Sept 15, 2015 to ask for an investigation into the poor investments.
“Upon tabling the special investigation, I realised that the amount of investment agreed as per the original decision was RM50 million and not RM150 million. Following this, the audit committee proposed that action be taken against the general manager of finance for not abiding by the procedure on the company’s investments.
“In my knowledge there was a change in the figure for the investment in Public Mutual, and whatever changes in amount should have been brought back to the Felcra board.
“Any changes to what was agreed at the Nov 24, 2014 board meeting should have been brought back to the board’s attention for it to be discussed and approved,” he testified.
Bung, who is also Sabah deputy chief minister and MP for Kinabatangan, and his wife were represented by counsel Datuk K Kumaraendran.
The trial will resume on June 23.
