Umno leader linked to Alstom bribery scandal, says Singapore daily

KUALA LUMPUR, Dec 5 — Already on the backfoot over a national cattle farming scandal, Umno is now rocked by allegations that a former leader took kickbacks from French engineering giant Alstom for a power plant project in Perlis.

Singapore’s Straits Times (ST) reported today that Malaysia’s Anti-Corruption Commission (MACC) officials raided last week the offices of Teknologi Tenaga Perlis Consortium (TTPC), which is partly controlled by former Dewan Negara president and ex-Perlis Mentri Besar Tan Sri Abdul Hamid Pawanteh (picture).

The newspaper said the Umno veteran was directly implicated in Alstom’s indictment for bribery in securing foreign contracts.

Abdul Hamid is said to have been paid 7.5 million Swiss francs (RM25.5 million) to help Alstom secure a contract to build a power plant in Perlis in the late 1990s. He was the state’s mentri besar from 1986 to 1995.

The Singapore daily said both Abdul Hamid and his former business partner, Ti Chee Liang, were singled out in the criminal summons against Alstom.

According to ST, Alstom was fined €31 million (RM130 million) by the Swiss Attorney-General two weeks ago for failing to implement proper controls to prevent bribery by company executives in Malaysia, Latvia and Tunisia, an offence under Swiss law.

Alstom is a major player in Malaysia in the power business, and is credited with supplying key equipment for nearly 7.5 gigawatts of the country’s installed power generation capacity, the paper added.

Citing government sources familiar with the investigations, ST reported that the MACC will be questioning local Alstom executives in the days ahead.

Last month, Alstom’s Malaysian office denied it was aware of local investigation regarding the RM133 million fine by Swiss authorities involving contracts awarded to the company here.

“There is no probe ongoing in Malaysia that we are aware of and Alstom have co-operated fully in Switzerland. The fine is for corporate negligence in the past and not for bribery,” Alstom Malaysia president, Saji Raghavan, said in a statement.

“In fact, investigation confirms there is no systematic bribery and sufficient controls are in place,” he pointed out.

The company had described itself as a “subcontractor of a consortium” and a “victim of the actions of some of its employees, who would have benefited from kickbacks”, according to a previous Reuters report.

Alstom is the second French company in as many years to be fined for bribing government officials in Malaysia, after telecommunications firm Alcatel-Lucent paid RM435 million to resolve US criminal and civil probes in December 2010.

The four-year probe centred on payments made by Alstom Network Schweiz AG to middlemen — termed “commercial agents” by the company — in return for securing government contracts to build power stations in 15 countries since the 1990s.

Alstom was awarded a RM2.8 billion contract by Tenaga Nasional earlier this year to provide key power generation equipment to Southeast Asia’s first 1,000-megawatt (MW) supercritical coal-fired power plant Manjung, Malaysia.

It also won turnkey contracts in 1994 and 2000 to build four power plants including the 1,300MW Lumut and the 670MW Kuala Langat plants and deals in 2003 and 2004 to install environmental control systems for the Tanjung Bin and Jimah coal-fired power plants.

Alstom was also appointed by Tenaga to supply two 125MW hydro power turbines, a generator and ancillaries for the 250MW Hulu Terengganu hydro power plant in 2010.
Alstom says
it is “the largest original equipment manufacturer in Malaysia” having supplied key equipment for nearly 7.5 gigawatt (GW) of the country’s installed power generation capacity.