PKFZ RM1 billion Fraud and Excess Charges

We commend without reservation the shocking findings by the special taskforce set up to investigate the legal and financial aspects of the Port Klang Free Zone (PKFZ), a subsidiary of Port Klang Authority (PKA).

Malaysians are dumbfounded by the fact that about RM1 billion, or nearly 30% of the RM3.522 billion contract with the master developer for PKFZ, Kuala Dimensi Sdn Bhd is found “to be either over-charged, unsubstantiated or even possibly fraudulent”. What is even more shocking is the fact that the above is only “the tip of the iceberg and many more wrongdoings are expected in the days ahead”!

We completely support the move by the task force to commence legal proceedings to recover the estimated RM1 billion from KDSB which is owned by Sarawak tycoon as well as Barisan Nasional Backbencher Club (BBC) Chairman, Datuk Seri Tiong King Sing.
However, actions must not only be taken against KDSB but also all directors, management and officers involved in PKFZ and PKA for the size and scale of this swindle could only have been pulled off with the complicity of insiders, the “close one eye” syndrome of some, and criminal negligence by others.
Above all, the Minister most responsible for the taxpayers being defrauded by these parties is Datuk Seri Chan Kong Choy, former deputy president of Malaysia Chinese Association (MCA). Their sheer negligence and incompetence, if not worse, created the mega RM12.5 billion scandal today, a bill which has to be foot by Malaysian taxpayers for many years to come.

We will give full backing to the special task force, PKA and even the current Transport Minister, Datuk Seri Ong Tee Keat to take all necessary actions against the responsible parties above.

We will also call upon Datuk Seri Tiong King Sing to resign as the BN BBC Chairman in order to protect the integrity of the Parliament until the above very serious allegations are dealt with. The BN BBC will have no credibility whatsoever, if led by one embroiled with a controversy involving billions of the rakyat's money.

“Our lawyers will henceforth deal with Kuala Dimensi chief executive officer Datuk Seri Tiong King Sing and its deputy Datuk Faisal Abdullah said PKA chairman Datuk Lee Hwa Beng .



“Since there may be instances of fraudulent claims and taxpayers’ money are involved, we will make a police report at the Klang police station so that appropriate investigation is taken,” said Lee in the statement.

Among others, the task force, which was set up on June 10 to look into the legal and financial aspects of PKA and PKFZ, had found that Kuala Dimensi had:


>POSSIBLY made fraudulent claims on electrical infrastructure worth RM55.8mil, which had yet to be carried out on the site, and 33kv supply works and civil infrastructure works worth RM83mil as TNB had rejected the proposal for Kuala Dimensi to undertake the work.
>NOT provided any document to support its claim of at least RM231mil as preliminaries under the development agreements while at the same time, it had made claims for items, which they were not contractually entitled to, such as claim for the procurement of a performance bond and payment for insurance premiums totalling RM5mil.
>NOT justified its claim for variation works of RM62mil under Additional Development Works and New Additional Development Works agreements.
>APPEARED to have made an “over claim” for hotel works, for which Kuala Dimensi had claimed RM69.6mil compared to the quantity surveyor’s valuation of RM44.7mil.
>NOT produced any invoice or payment voucher for the RM61mil which the company claimed was professional fees and expenses incurred.
>CLAIMED RM254.9mil as extra work done even though the purported revised works fell within the scope of the original works envisaged in the main development agreement.
Lee said while PKA members still required more time to consider the lengthy report in detail, several decisions had been made in the meantime.
“The board had decided that the quantity surveyor continue to re-measure the value of works performed by Kuala Dimensi in order to establish the real sum owing to the main developer.
“Presently, they have identified a difference of at least RM93mil between the claims made by Kuala Dimensi and the measurements made by the quantity surveyor.
“We believe that there will be further differences in the re-measurement exercise.”