Isa Samad defied Felda’s mandate with RM160 million hotel deal, court told

Former Felda chairman Isa Samad.

KUALA LUMPUR: The High Court here today heard that former Felda chairman Isa Abdul Samad had gone ahead with the purchase of a hotel in Kuching for RM160 million despite being told that this would contravene an existing mandate.

Deputy public prosecutor Afzainizam Abdul Aziz said Felda Investment Corporation Sdn Bhd (FIC) CEO Mohd Zaid Abdul Jalil had told the accused that a fresh mandate would be needed to enter into the transaction for Merdeka Palace Hotel & Suites from Syarikat Gegasan Abadi Properties Sdn Bhd.

“However, the accused was of the view that the approval from Felda was not needed,” he said in his opening statement at Isa’s criminal breach of trust (CBT) and corruption trial.

Isa, 68, was both chairman and director of FIC which is a subsidiary of Felda.

He pleaded not guilty last year to one count of CBT and nine of receiving over RM3 million in gratification in approving the proposal for the purchase of the hotel for FIC.

He was accused of committing the offence at Level 50, Menara Felda, Platinum Park, No. 11, Persiaran KLCC, on April 29, 2014.

The CBT charge was framed under Section 409 of the Penal Code, which provides imprisonment of up to 20 years, whipping and a fine upon conviction.

He was charged with committing the corruption offences at Level 49, Menara Felda, between July 21, 2014 and Dec 11, 2015.

The charges were made under Section 16(a)(A) of the Malaysian Anti-Corruption Commission Act, punishable under Section 24(1) of the same law, which provides a jail term of up to 20 years and a fine of at least five times the bribe amount.

Afzainizam said the Felda board on June 25, 2013 gave FIC the mandate to enter into investments below RM100 million only.

“The prosecution will prove its case that the hotel purchase sale and agreement dated June 27, 2014 and payment made by FIC went against the mandate given by Felda,” he said.

He said evidence would also show that the FIC board abandoned its plan on Feb 28, 2014 to buy the hotel at RM137.6 million as it was not feasible.

Two weeks later, though, the accused directed Zaid to prepare a proposal to FIC for the purchase of the hotel, he said.

“The accused first received a proposal for RM165 million, but a RM5 million discount was later given to make the deal stand at RM160 million,” he added.

Afzainizam said the prosecution would also show that the accused collected RM3 million in corrupt money in nine instalments through his former special officer Muhammad Zahid Md Arip from Ikhwan Zaidel, the director of Syarikat Gegasan Abadi Properties. - FMT