Monday, December 5, 2011

Ex-Perlis MB denies graft claims over power plant

Despite a finding by Swiss authorities after exhaustive investigations, Umno veteran Tan Sri Abdul Hamid Pawanteh has denied accepting a bribe from French engineering giant Alstom for a power plant in Perlis.

The former Perlis mentri besar and Dewan Negara president was responding to the Singapore’s Straits Times that the Malaysian Anti-Corruption Commission (MACC) officials raided his Teknologi Tenaga Perlis Consortium’s (TTPC) office last week as he was directly implicated in Alstom’s indictment for bribery in securing foreign contracts.

“I wish to categorically state that the allegations contained in the above report are totally baseless and malicious,” Abdul Hamid (picture) said in a statement to The Malaysian Insider last night.

He stressed that the company’s board of directors, including Ti Chee Liang who was named in the Swiss court papers, did not receive “7.5 million Swiss francs (RM25.5 million) to help Alstom Malaysia secure a contract to build a power plant in Perlis in late 1995”.

“I confirm that no monies were received by any Board members including me,” the Umno veteran said.

Abdul Hamid explained that the decision to award the contract was unanimous and the contract was later awarded on November 30, 1999 to ABB when he was the board chairman. ABB was later bought up by Alstom.

The Umno leader was Perlis mentri besar between 1986 and 1995 before being made TTPC board chairman from 1996 to 2005.

The politician also disclosed that he was unaware of ongoing investigations into Alstom Malaysia by the Swiss authorities.

“To date, I have not been notified or called by thern to make any statements or provide any details. I am shocked that the Swiss authorities have accused Ti and me of wrongdoings, financial or otherwise.

“For this reason, I have instructed solicitors in Switzerland to initiate proceedings to clear my name. I welcome any investigation pertaining to these baseless allegations,” Abdul Hamid said in his statement.

In the report picked up by The Malaysian Insider, the Singapore Straits Times said both Abdul Hamid and his former business partner Ti were singled out in the criminal summons against Alstom.

According to ST, Alstom was fined €31 million (RM130 million) by the Swiss Attorney-General two weeks ago for failing to implement proper controls to prevent bribery by company executives in Malaysia, Latvia and Tunisia, an offence under Swiss law.

Alstom is a major player in Malaysia in the power business, and is credited with supplying key equipment for nearly 7.5 gigawatts of the country’s installed power generation capacity, the paper added.

Last month, Alstom’s Malaysian office denied it was aware of local investigation regarding the RM130 million fine by Swiss authorities involving contracts awarded to the company here.

“There is no probe ongoing in Malaysia that we are aware of and Alstom has co-operated fully in Switzerland. The fine is for corporate negligence in the past and not for bribery,” Alstom Malaysia president Saji Raghavan said in a statement.

“In fact, investigation confirms there is no systematic bribery and sufficient controls are in place,” he pointed out.

The company had described itself as a “subcontractor of a consortium” and a “victim of the actions of some of its employees, who would have benefited from kickbacks”, according to a previous Reuters report.

The Swiss summary punishment order obtained by The Malaysian Insider showed that Alstom’s business units paid success fees which totalled 7.7 million Swiss francs to offshore companies belonging to Ti and Abdul Hamid “with accounts in Switzerland.”.

“Both of the aforementioned beneficiaries were at the time leading executives at the client of Alstom. In return for payment, they influenced both the award of contracts as part of this project in previous years (including securing of financing) and ensured that any difficulties encountered by the client in the performance of the contract was resolved in favour of Alstom,” according to the document signed by Swiss chief federal attorney Walter Mader and federal attorney Stefan Lenz from the Attorney-General’s Office.

Alstom is the second French company in as many years to be fined for bribing government officials in Malaysia, after telecommunications firm Alcatel-Lucent paid RM435 million to resolve US criminal and civil probes in December 2010.

The four-year probe centred on payments made by Alstom Network Schweiz AG to middlemen — termed “commercial agents” by the company — in return for securing government contracts to build power stations in 15 countries since the 1990s.

Alstom was awarded a RM2.8 billion contract by Tenaga Nasional earlier this year to provide key power generation equipment to Southeast Asia’s first 1,000-megawatt (MW) supercritical coal-fired power plant Manjung.

It also won turnkey contracts in 1994 and 2000 to build four power plants including the 1,300MW Lumut and the 670MW Kuala Langat plants and deals in 2003 and 2004 to install environmental control systems for the Tanjung Bin and Jimah coal-fired power plants.

Alstom was also appointed by Tenaga to supply two 125MW hydro power turbines, a generator and ancillaries for the 250MW Hulu Terengganu hydro power plant in 2010.

Alstom says it is “the largest original equipment manufacturer in Malaysia”, having supplied key equipment for nearly 7.5 gigawatt (GW) of the country’s installed power generation capacity.
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