Perak rep: Audit reveals RM217m increase in MAPS project cost

John Bunyan
Perak Corporation Berhad audit committee chairman Chong Zhemin speaks during a press conference in Ipoh March 23, 2019. — Picture by Farhan Najib

IPOH, March 23 — Perak Corporation Berhad audit committee chairman Chong Zhemin today made a shocking revelation on the construction and development cost of the Movie Animation Park Studios (MAPS), which had increased about RM217 million compared to its original cost.

He said that former mentri besar Datuk Seri Zambry Abd Kadir, who was the chairman of the Perak State Development Corporation, should explain and be fully responsible for the suspicious cost increase, as he had the direct control over Perak Corporation Berhad (PCB).

PCB owns the PBC Development Berhad (PCBD), who holds the 51 per cent share in the Animation Theme Park Sdn Bhd (ATP). The balance 49 per cent share is belongs to RSG MAPS Sdn Bhd (RSGM).

“Zambry should be fully responsible for the increase in the cost of constructing and developing MAPS, which went from RM390 million to RM607 million. A fact that was never disclosed by the previous administration,” he told a press conference at MAPS.  

“This is shocking and appalling as RM607 million represent 57.21 per cent of the 2019 Perak State Budget which stood at RM1.061 billion. The construction of MAPS alone is already more than half of the current state total budget,” he said.

The Keranji assemblyman added that Zambry should also explain why he allowed PCBD to be solely responsible for the additional funding by approving three shareholder advance agreements totaling RM250 million.

“PCBD has advanced payment of RM198 million to ATP, followed by an additional RM6 million advance payment by PCB to ATP.

“While RSGM, who has 49 per cent share, only paid an advance payment of RM6.25 million to ATP. This agreement is totally unacceptable and unfair. PCBD paid more than it’s actually should,” he said.

Chong said the remaining project fund was financed by a RM280M syndicated term loan and the issuance of ordinary and preference share capital to the shareholders.

Chong also said that the internal audit report also shows that out of RM607 million project cost, a total of RM413 million was paid either directly, in the form of advancement or payments, to a private company, who is the main contractor of MAPS hired by ATP.

“Our initial investigation reveals that the private company is currently in the process of winding up after it was taken over by another foreign company.

“In May 2018 during the creditor meeting called by the appointed liquidator we were told that the company only has RM1500 left in their bank accounts,” he said.

“Although the audit report is inconclusive of any misconduct of fraudulent acts in the project, but there are a lot of questionable decisions and lopsided agreement that could be raised,” he added.

Chong said the review on the main contractor’s account and records are vital and he will raise the matter in the coming State Public Accounts Committee meeting, which is scheduled on Tuesday, to get to the bottom of the issue.

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