Report: Bank Pembangunan Malaysia sues ex-MD, 26 others for alleged fraud involving RM400m loan in 2012
KUALA LUMPUR, June 29 — Bank Pembangunan Malaysia (BPMB) has filed a lawsuit against 27 individuals and entities, including its former president and group managing director Datuk Mohd Zafer Hashim, over a RM400 million loan granted to Aries Telecoms (M) Bhd a decade ago.
Local business newspaper The Edge reported today that BPMB is seeking a total of RM564.99 million in losses and damages supposedly caused by 27 people named as defendants.
According to The Edge which cited from the court filings, the RM400 million loan was approved in May 2012 to partly finance a RM1.3 billion project undertaken by Aries to install a fibre optic network around peninsular Malaysia.
BPMB — a development financial institution wholly owned by the Malaysian Government through the Minister of Finance (Incorporated) — also filed an ex-parte Mareva injunction against nearly all the defendants barring a few exceptions, the newspaper reported.
A Mareva injunction is a temporary restraining order that prevents a defendant from disposing assets until court decides on the legal dispute.
The ex-parte injunction application is scheduled for an online hearing this Friday before judge Ong Chee Kwan of the Commercial High Court in Kuala Lumpur.
According to the court filings as reported by The Edge, BPMB is accusing the 27 defendants of conspiring and using unlawful means to not only defraud the bank, but concealing such fraud and its proceeds.
BPMB claimed the loan was disbursed to Aries without fulfilling necessary conditions.
BPMB also alleged that the money which was meant to be used for the fibre optic project was misused, and that the funds were "siphoned and/or unjustifiably transferred” to other entities including Paneagle Holdings Bhd, BVS Trinity Sdn Bhd, VCB Malaysia Bhd, Orient Telecoms Sdn Bhd and Primawin Ltd — all of whom it named as defendants in the suit.
The RM400 million loan approval was granted based on the appointment of Huawei Technologies Co Ltd (Huawei China) as turnkey contractor to build, operate and maintain the network for the project.
However, Huawei China was subsequently replaced by Paneagle Holdings without the full knowledge, consent or approval of BPMB.
Despite these corporate changes, The Edge reported that the loan was still disbursed in two tranches of RM200 million each to Aries (then known as V Telecoms Bhd) as Zafer had allegedly approved two separate waivers of certain conditions required.
The Edge listed the other defendants as including: Aries director Wan Alias Wan Ngah and former director Roslina Ibrahim; Paneagle Sdn Bhd and its director Abdul Wahid Abdul Ghani; Open Fibre Sdn Bhd and its director Mohd Radzi Mohamed; Orient Telecoms Sdn Bhd and its directors Mustafa Ali Zaminali Sayed, Muhammad Shazhakim Shazarul Hisham, and Shaza Arina Shazarul Hisham; Silver Ridge Sdn Bhd and its director Wong Chee Keong; BVS Trinity and its director Abd Hadi Abd Majid; and Zavarco Plc and its director Tunku Mazlina Tunku Abd Aziz.
