Four months of opportunity cost

Politics is about perception. Perception, not proof, saw the ‘Political Tsunami’ of 8 March 2008 unprecedentedly happened for Barisan Nasional, after eleven plus one general elections. In Malaysia, perception is almost everything in politics.

Two days ago, Women and Family Development Minister Dato’ Seri Shahrizat Abdul Jalil announced of her resignation from the Federal Government. That is a day before husband and National Feedlot Corporation Sdn. Bhd. Executive Chairman Dato’ Seri Dr Mohamed Salleh Ismail was charged for criminal breach of trust and corrupt practices, involving a substantial sum of money allegedly wrongfully utilised which derived from his company’s drawdown of soft loan from the Federal Government.

Tuesday March 13, 2012

NFCorp boss claims trial


KUALA LUMPUR: The executive chairman of the National Feedlot Corporation Sdn Bhd has claimed trial at the Sessions Court here to two counts of committing breach of trust and two counts of violating the Companies Act 1965 involving RM49.7mil.

Datuk Seri Dr Mohamad Salleh Ismail, 64, arrived in court at 2.15pm accompanied by his wife Datuk Seri Shahrizat Abdul Jalil, their eldest son Wan Shahinur Izmir and other family members.

The charges were read to Dr Mohamad Salleh at 2.27pm before judge S.M. Komathy Suppiah in a packed courtroom.

The proceedings yesterday marked a new chapter in the NFCorp controversy which arose after the Auditor-General’s 2010 Report highlighted the failure of the National Feedlot Centre to achieve its target, and which grew with revelations that the company had used the government-funded soft loan for purposes not related to cattle breed-ing.

Dr Mohamad Salleh was charged with dishonestly misusing funds amounting to RM9,758,140 through four cheques to partly finance the purchase of two units of One Menerung Condominium in Block B here for the National Meat and Livestock Corporation Sdn Bhd, which he owns with one of his sons.

According to the charge, he committed the offence in his capacity as an NFCorp director entrusted with control over the company’s assets.

He is said to have committed the offence at CIMB Islamic Bank Bhd in Jalan Burhanuddin Helmi, Taman Tun Dr Ismail, here between Dec 1 and 4, 2009.

Dr Mohamad Salleh was charged under Section 409 of the Penal Code which carries a jail term of up to 20 years, a fine and whipping.

He is also accused under Section 132(2)(a) of the Companies Act 1965 of committing the offence without approval from an annual general meeting of NFCorp to gain profit directly.

He is also accused of transferring NFCorp’s funds of RM40mil through a cheque into the National Meat and Livestock Corporation’s account at the same bank from May 6 to Nov 16, 2009.

For this, he faces charges of criminal breach of trust and violating the Companies Act.

Deputy Public Prosecutors Dzulkifli Ahmad, Awang Armadajaya Awang Mahmud and Azimul Azami prosecuted while the defence was led by Badrul Munir Bukhari.

Pleading for a lower bail, counsel Badrul Munir said Dr Mohamad Salleh had given his full cooperation to the police and prosecution, and his client was in court to clear his name. He applied to release the accused on a RM50,000 personal bond for each charge.

Dzulkifli said the prosecution had no objection to the application as they did not see why Dr Mohamad Salleh would flee the country. He, however, said the accused should surrender all his travel documents to the court.

Dzulkifli applied to the court under Section 165 of the Criminal Procedure Code for a single trial for all the charges.

Judge Komathy agreed to a single trial and set bail of RM500,000 with one surety for all four charges.

She also ordered Mohamad Salleh to surrender his passport pending mention of his case on April 13.

Wan Shahinur Izmir paid the bail.

Shahrizat was impassive in court and declined to speak to reporters after the proceedings.


The thing is that, Sharizat’s resignation should have been four months earlier. When PKR Strategic Director Rafizi Ramli raised this matter in public domain, referring to the ‘irregularities’ highlighted by the Auditor General’s report, Shahrizat who is UMNO and BN Wanita Chief decided to slug it out. She even used UMNO Assembly platform and her capacity of Wanita UMNO Chief to rally Wanita UMNO members and defend her.

Suami says tidal bersalah!“.

Many UMNO leaders were very uncomfortable with that. Some, even said it in the open for Shahrizat to walk away and even quit, “For the sake of the party”.

However, she was vehemently in denial. She went about town and met with Wanita UMNO Groups. After four months, more and more are being thrown against Dr Salleh and their immediate family, as directors and shareholders of the company which was granted Federal Government aid via soft loan to develop the feed meal and contract rearing of cattles for the Malaysian consumers.

The NFCorp issue a chronology of events


Oct 24 – The Auditor-General’s 2010 highlighted the National Feedlot Centre (NFCorp)’s failure to achieve its target of 8,000 heads of cattle that year. The RM74 mil centre in Gemas, Negri Sembilan only achieved 3,289 heads of cattle or 41% of the target.

Nov 1 – PKR piles the pressure on Shahrizat, demanding that she explain claims of financial mismanagement and corruption in the NFCorp, run by her husband and two of their children.

Nov 15 – The MACC hand over investigations into the alleged multi-million ringgit purchase of a luxury condominium in Bangsar by the NFCorp to the police.

Nov 16 – NFCorp executive director Wan Shahinur Wan Salleh said they had used nearly RM600,000 of its funds to pay for credit card expenses, but pointed out that they were corporate cards used for “business development purposes”

Nov 18 – NFCorp executive chairman Datuk Dr Mohamad Salleh Ismaildenied claims that the project was in a mess, claiming they are on track to produce 60,000 heads of cattle by 2015. Salleh also justified the purchase of two luxury condominiums costing RM6.9 mil each, saying the investment would generate an annual yield of some RM900,000 or a 12.9% return of investment rate.

Nov 19 – Inspector-General of Police Tan Sri Ismail Omar said Bukit Aman had started a probe into the NFCorp

Nov 29 – Shahrizat brushes aside calls for her to quit over her family’s involvement in the NFC scandal, saying that it had nothing to do with her.

Dec 1 – PKR unveil more allegations of financial misappropriation by the NFCorp, claiming that the company ought a luxury car, two plots of land and paid for holiday packages using part of its RM250mil Government soft loan.

Deputy Inspector-General of Police Datuk Seri Khalid Abu Bakarhowever announces that they found no elements of criminal breach of trust or misappropriation in their ongoing investigation into the NFCorp

Dec 3 – Home Minister Datuk Seri Hishammuddin Tun Hussein says the probe into the NFC would continue, regardless of the police’s preliminary findings that there were no elements of criminal breach of trust.

Dec 6 – Police say the NFC’s purchase of two RM6.9mil luxury condominiums was kosher as they were registered under a corporate firm and not in the names of individuals.

Dec 24 – The MACC raid the NFC office in Mont Kiara, taking several envelopes filled with documents and a computer, believed to be linked to the various claims levied against the company.


Jan 3 – Shahrizat denies having tendered her resignation, amidst speculation that she had handed over her resignation letter to Prime Minister Datuk Seri Najib Tun Razak over

Jan 13 – Shahrizat takes leave from her official duties to make way for the MACC’s probe on whether or not she had any involvement in the NFCorp issue.

Jan 15 – Najib confirms that the NFC’s assets are frozen to assist into investigations over alleged misappropriation

Jan 16 – Police conclude their probe into the NFCorp, and present their findings to the Attorney-General for further action.

Jan 19 – Deputy Prime Minister Tan Sri Muhyiddin Yassin announces the Government’s decision to appoint an accounting firm to carry out a due diligence and project audit on the NFCorp.

Jan 20 – Shahrizat files a RM100 mil suit against PKR Ampang MP Zuraidah Kamaruddin and strategic director Rafizi Ramli for defamation in connection with the NFCorp issue

Jan 26 – Auditor-General Tan Sri Ambrin Buang clarifies his department’s 2010 report on the NFC, saying that they highlighted weaknesses in implementation of the project – but never mentioned anything on misappropriation of funds.

Feb 8 – The police resubmit their investigation papers on the NFCorp to the Attorney-General’s Chambers and are awaiting orders on the next course of action, after beefing up their findings at the request of the Attorney-General.

Mar 3 – The Attorney-General returns the police’s investigation papers on the NFC yet again, ordering the men in blue to carry out further investigations.

Mar 8 – Police reveal they are probing a RM1.7 mil apartment cum office purchase by the NFCorp in Khazakhstan, believed to have been made after the company signed an agreement to help the Khazakhstan government breed cattle.


When they reached this juncture where Dr Salleh had to be charged for CBT, fraud and abuse, then only she gave in. Her Cabinet colleagues lauded this move as “Brave and best interest of the party”. The most important questions that UMNO leaders should ask is, “At what cost?”.

It is a politically very costly for BN and UMNO.

On 28 March 2009 when Prime Minister Dato’ Seri Mohd. Najib Tun Razak spoke for the first time as the President of UMNO in his acceptance speech at the final moments of that year’s UMNO General Assembly, he promised of three things. One of it is “To combat corruption”. The Malaysian public erosion of confidence to the ruling party has been marred badly by corruption and abuse of power practices, which saw great increase during five and a half years of PM ‘Flip-Flop’ Tun Abdullah Ahmad Badawi’s tenure.

This ‘perception’ issue has actually brought down confidence on Prime Minister Najib’s leadership a few notches, even though he is highly a popular political leader. Example at hand was when we were following a Menteri Besar doing his ‘walkabout’ in three different DUNs In February. This MB went at UMNO/MCA/MIC branch level to understand issues on the ground. We were surprised that one of the top most national agenda that was raised in almost all ‘peti undi’ in these three DUNs was about “NFC scandal”.

We were in London recently. We met separately a handful of Malaysians living and studying abroad, and spoke to them at length over many issues. Some, have been there for over three decades. They follow Malaysian politics very closely. Even the students. They read the blogs. All of them were raising about the “NFC scandal”.

Prime Minister Najib should have been very decisive on this matter, even as far back as late November 2011 (just before the UMNO GA). Anywhere, Malaysians talk about the “NFC scandal”. The big picture comes first. We (these Londoners were in touch) communicated when the news of Shahrizat’s resignation and Dr Salleh’s charge spread very fast to their attention. The point they all raised, “How to ‘repair’ the perception damage and is there enough time before the nest GE?”.

Our answer, “Its a political opportunity cost”. Even we are not convinced of the damage done.

Prime Minister Najib must remind his Cabinet, UMNO Supreme Council, BN High Council and UMNO party members at large in strong bold words that he mean business and do not tolerate issues that is potentially scandalous. Nip it in the bud. Kill before the story is even allowed to bloom in the new media. BN can no longer afford anymore scandal, no matter how trivial. It is politically suicidal.

Wanita UMNO must be made to understand. Their Boss is ‘tainted’. They cannot afford to be sentimental and emotional about it. Shahrizat, should leave Wanita UMNO too. Especially after that closing address to last year’s Wanita UMNO Assembly. It should be an unconditional withdrawal and Wanita UMNO must accept this. These four months of opportunity cost could actually take years to recover.

Published in: on March 13, 2012 at 08:30  Comments (22)