PKFZ SCANDAL: NEW LIGHTS BEING SHED ON ??CRIMINAL BREACH OF TRUST??

A few Major players of PKFZ scandal.

Pic from left:Yap Pian Hon, Ting Chew Peh, Siong Sing King, Ong Tee Keat, Kee Lian Yong and Lee Hwa Beng. Not present are pic of Chan Kang Choy, Lim Thean Shiang (resigned and replaced by Kee Lian Yong), O.C. Phang, and Lim Liong Sik

Port Klang Authority (PKA or Lembaga Pelabuhan Klang, LPK) is a statutory body.

Public Accout Committee Chairman Datuk Seri Azmi Khalid and his team had discovered anomalies and mismanagement in both the Board Of Directors of LPK/KPA and the management.


According to Datuk Seri Azmi Khalid:

"There were some payments made by the board that were only signed by the management, and many decisions that were made such as contracts and agreements were first signed by the management before the board of directors was informed,"

" The normal practice is that the board of directors makes the decisions, which are then executed by the management," said Azmi.


"I cannot reveal the turnaround plan at the moment because as a statutory body, we have to go back to the government (before the plan can be implemented" replied the newly appointed Gm of KPA/LPK when asked regarding the new restructuring plan.

House-cleaning in Port Klang

PETALING JAYA: The Port Klang Authority (PKA) will undertake a house-cleaning exercise and go back to basics to what it is supposed to be – a regulatory body and safeguarding its revenue.

This is the ambitious task of its newly-appointed chairman, Datuk Lee Hwa Beng (pic).

A revamp of both the PKA and the Port Klang Free Trade Zone (PKFZ) boards is in the pipeline, and it is learnt that Westport’s Tan Sri G. Gnanalingam has tendered his resignation from the latter.

For starters, an international firm of auditors will be appointed to go through the entire accounts and activities of the PKFZ.

"But more importantly, the focus will be on getting to the bottom of how costs escalated to RM4.6 billion – far above the original RM2 billion," Lee told theSun yesterday.

He said the selection of an international firm – which he will announce at PKA’s first board meeting tomorrow – was to ensure that it was independent and free from interference while conducting its audit.

"People have no confidence in the ACA (Anti-Corruption Agency) or PAC (Public Accounts Committee), so this is the best option," he said.

Asked if wrong-doers will be named and shamed, Lee said: "I will recommend that the findings of the audit be made public and in case of impropriety, that the law takes its course.

"I am certain that with Datuk Ong (Tee Keat) at the helm, I will have a free hand in running the port as he is a no-nonsense person and is as adamant as I am to get to the bottom of the PKFZ issue," said Lee, whose appointment was announced by the transport minister on Friday.

"I am well aware of the challenges and pitfalls but I am prepared to fulfil my duties transparently and effectively."

Lee, an accountant by training, however, opined that the PKFZ was a bad idea to start with.

"Tariffs worldwide are going down, so how is the PKFZ going to be attractive to investors?

"With the worldwide economic downturn, the manufacturing sectors are also being relocated to China, India and Vietnam," said Lee, the former three-term state assemblyman for Subang Jaya.

"However, we have to move forward because so much has been invested and priority will be making PKFZ a viable venture by ensuring that its occupancy is at acceptable levels and providing professional services to clients," said Lee, adding that one way to go was by making PKFZ more high-tech and capitalising on its proximity to Westport.

He also revealed that PKA is looking for a suitable candidate to lead the management team and that the person will not be a political appointee.

"On the contrary, meritocracy will rule," said Lee, adding that the candidate will not be limited to locals.

Since port operations had been privatised, he said, the PKA should focus on its original objectives. He said that he had been informed of other activities of PKA, including property development and other projects.

The authority entered into a joint-venture agreement to develop a huge parcel of land where bungalows for senior managers was situated. The buildings were demolished but it has since joined a long list of abandoned projects. Plans were also afoot to utilise its large land bank in Port Klang for development in a bid to raise money for the PKFZ.

R. Nadeswaran and Terence Fernandez/sun2surf


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PKA board kept in the dark over project, PAC told


KUALA LUMPUR (Sept 3, 2009) : The Port Klang Authority (PKA) management refused to divulge any information on the Port Klang Free Zone (PKFZ) project to its board of directors despite requests to do so, Public Accounts Committee(PAC) chairman Datuk Seri Azmi Khalid said today.

Azmi, who had earlier questioned former PKA chairmen Tan Sri Dr Ting Chew Peh and Datuk Yap Pian Hon, said they found the management had ignored requests by the board to give information, despite written requests to do so.

"I feel that Datuk Yap gave a clearer picture on the willingness of the PKA management to give information to the board of directors. The perception we got is that the information was not given, even when asked for in writing," said Azmi, who told reporters that key decisions were made without the knowledge of the PKA board.

"There were some payments made by the board that were only signed by the management, and many decisions that were made such as contracts and agreements were first signed by the management before the board of directors was informed," said Azmi.

"The management told the board what they wanted the board to know, and they asked for further information, and most of the requests were ignored by the management, or given late," he added.


"The PAC has to reexamine the management procedures, and what powers was given to the management to allow them to make decisions and then only inform the board of directors. The normal practice is that the board of directors makes the decisions, which are then executed by the management," said Azmi, who told reporters that requests had been noted in the minutes of board meetings.

"We do not know what powers were delegated, so we will have to find out a bit more. The management was led by Datin Paduka O.C. Phang," he added.

He said the problem existed when Ting was chairman.

"Tan Sri Ting also said that the board only received information brought up in the agenda by the management. What was not brought up was not discussed. But when Yap was chairman, the PKFZ issue was already in the media, and Yap and all the board members wanted to know more," said Azmi.

He gave two explanations for the cost escalations in the controversial PKFZ project.

"The cost escalation occurred because of two reasons. One was due to compound interest. If it was paid, there would have been no compound.

"The second was due to project cost escalations, as if a project has variation cost orders, it must follow what was stated in the agreement. Some will only allow a 20% variation," he said.

Tan Yi Liang/sun2surf
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PKFZ business turnaround plan ready in two months


KLANG (Sept 3, 2009) : Port Klang Authority (PKA) general manager Kee Lian Yong today announced that the Port Klang Free Zone (PKFZ) business turnaround plan would be ready in two months after securing the support and approval of the stakeholders.


Kee, who replaced Lim Thean Shiang in July, said although there were issues and challenges faced by the project, more so during this period of financial crisis, he believed there were ways to reposition and transform the project.

He said notwithstanding the setback faced by PKFZ during its developmental stage, "we believe that the government's original aspiration for the project to provide an attractive investment environment for manufacturers and other businesses will generate cargo for Port Klang as well as developing the port into a regional distribution hub and a trade and logistics centre".

"PKA has initiated a financial restructuring plan and a revamped business model and the authority will work aggressively to engage all relevant stakeholders, including government agencies, to seek their structural support.

"However, I cannot reveal the turnaround plan at the moment because as a statutory body, we have to go back to the government (before the plan can be implemented)," he told a press conference.

Kee said the issue of the authority being an ineffective one-stop centre would be addressed to ensure a competitive environment to attract investors.

Asked if the financial restructuring plan would include loan restructuring with the project's turnkey developer Kuala Dimensi Sdn Bhd (KDSB), he said it could be part of the whole scheme as a financial plan would usually cover all angles.

On whether PKA would consider an earlier redemption of KDSB bonds as suggested by the developer last week to save the project cost from the current RM4.6 billion to a minimum of RM3.2 billion, Kee refused comment but said the authority would deal with the issue at an appropriate time.

He said among the new initiatives to be undertaken by the authority are to:

> Register all necessary logistics services providers operating in Port Klang to ensure efficiency and cooperation;

> Monitor the performance of port terminals to ensure compliance on efficiency in performance and activities rendered at Port Klang are consistent and on par with international standard;

> License all direct port activities and ancilliary services within the port as PKA has taken steps to license and regulate private jetty operators and have so far approved 20 operators based on merit; and

> Enforcing security and safety within the port limit and pilotage district as PKA has upgraded the vessel traffic management system with automatic identification system as well as installing scanners at strategic locations.

Kee said a strategic port masterplan would be ready in six months to map out the direction of Port Klang for both short and long-term planning, including a review of future port developmental plans and strategies.

Giam Say Khoon/sun2surf

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