Mara overpaid RM14m for Melbourne building, says report

An Aussie facilitator says the extra money was paid to grease palms, according to The Age.

MELBOURNE: The dodgy deal in which Malaysian officials allegedly paid 20% or A$4.75 million (RM13.7 million) over the asking price for a five-storey apartment block near Monash University here has stunned Australians.

Even in Melbourne’s booming property market, the $22.5 million (RM65 million) price tag for a building “designed like an IKEA cupboard” seemed well above the odds. That’s because it was, The Age reported today.

The deal, involving the Malaysian officials and Australian facilitators, is doing the Australian image no good. Australia is regarded by both local and foreign anti-corruption officials as an “investment hot spot for the crooked and corrupt”.

An eight-month investigation by the Fairfax Media group’s investigation team has traced suspicious money flows, court files and corporate records across three continents to uncover why Dudley House’s purchase price was so high.

“Its sale was part of a global money laundering and bribery scheme engineered by greedy local developers and powerful officials overseas who pocketed $4.75 million in bribes on this single deal,” The Age said.

The Age is part of the Fairfax Media group.

One of the Australians involved in the deal, Peter Mills, who once did a stint in prison for corporate fraud, was recently quizzed in a civil court case about whether the $4.75 million generated by inflating Dudley House’s sale price was used “to grease palms” overseas.

His reply was short but surprisingly honest. “Yeah, I think so.”

The Malaysian connection in this shady deal is said to be two men with the title of “Dato”. They allegedly facilitated the deal through a network of contacts connected to Mara.

Mara was set up in 1965 with the noble aim of helping the rural poor. Its decision to buy Dudley House through a subsidiary, Mara Inc, shows how far it has strayed from its core values, The Age commented.

Australia’s integrity standing took a beating in 2012 when Papua New Guinea’s chief corruption fighter labelled Australia the “Cayman Islands” of the Asia Pacific, due to the ease in which PNG politicians could invest their ill-gotten wealth in Australian property.

In recent, years Australian authorities have detected several shady property purchases by Chinese nationals with hot money.

The Chinese government has more recently launched its own campaign, warning that crooked officials are taking refuge and squirelling away embezzled funds in Australia.