KUALA LUMPUR, April 27 — The DAP accused Transport Minister Datuk Seri Kong Cho Ha today of emulating his predecessors Tun Dr Ling Liong Sik and Tan Sri Chan Kong Choy who are currently on trial for lying to the Cabinet over the Port Klang Free Zone (PKFZ) scandal.
Publicity chief Tony Pua told reporters the MCA secretary general must have sought Cabinet approval before the Treasury released “billions of ringgit” over the past two years to pay Kuala Dimensi Sdn Bhd’s (KDSB) bondholders in the project that may cost taxpayers up to RM12.5 billion from an initial RM1.1 billion.
But the turnkey developer, which also sold a 1,000-acre plot for the project at an allegedly inflated price of RM25 per square foot, had already agreed to cover any shortfall in payments by the government due to uncompleted works, according to letters of undertaking Pua distributed to reporters.
The Port Klang Authority (PKA) sued KDSB for RM1.6 billion in 2009 for overcharging as well as uncompleted work.
“We want the police and Malaysian Anti-Corruption Commission to investigate the transport minister for misleading the Cabinet in the same way Tun Ling did,” the Petaling Jaya Utara MP said, referring to the former MCA president.
Pua also said the Lumut MP had either committed criminal negligence or criminal breach of trust.
He added that Prime Minister Datuk Seri Najib Razak, who is also finance minister, must endorse the payments, “so either he did it knowingly, or on Kong’s advice.”
The four letters state that KDSB agreed to “undertake to cover the shortfall in the event of any shortfall in the amount payable by PKA” and also indemnified the special purpose vehicles (SPV) representing the bondholders from liabilities incurred should the company not comply with the development agreements signed with PKA.
Both Kong and PKA chairman Datuk Teh Kim Poh have insisted that they must meet the payments to avoid breach of contract.
But Teh’s predecessor Datuk Lee Hwa Beng told The Malaysian Insider that the regulators for Malaysia’s largest port were advised by Skrine & Co not to make full payments to the SPVs as it would compromise their legal suits.
The PKFZ project, initially tagged at RM1.1 billion after it was mooted by then Transport Minister Tun Dr Ling Liong Sik in 1997, more than quadrupled to RM4.6 billion by 2007.
A position review by top accounting firm PricewaterhouseCoopers revealed in 2009 that the total cost, including interest from debt repayments, could reach RM12.5 billion.
Since December 2009, six individuals have been charged in court including ex-MCA president Dr Ling and his successor as transport minister, former MCA deputy chief Chan, who are both accused of lying to the Cabinet.