KUALA LUMPUR – The names of two corporate figures have been drawn to the centre of the controversy surrounding the navy’s procurement of littoral combat ships (LCS), amid a sea of headlines involving prominent politicians and the multi-billion ringgit project.
As the war of words over the LCS issue rages on between government officials and the opposition, both Anuar Murad and Tan Sri Ahmad Ramli Mohd Nor have yet to receive public scrutiny.
This is despite their names being repeatedly mentioned in the recently released Public Accounts Committee (PAC) report about the project, which is reportedly worth an eye-watering RM9 billion.
The report carries two sub-chapters solely dedicated to Anuar and Ramli, detailing their heavy-handed involvement in the alleged scandal, with the former being named a staggering 23 times, while the latter’s name crops up on 14 occasions.
Following a special report on the LCS issue yesterday, The Vibes has now looked into the contents of the 247-page PAC report, in which both Anuar and Ramli were allegedly implicated in the controversy.
Big names in big places
A former navy captain, Anuar had been the project’s main contractor Boustead Naval Shipyard Sdn Bhd’s (BNS) LCS programme director, affording him pivotal responsibility over the construction and delivery process for all vessels involved.
He had also served as the director of safety and defence at Boustead Heavy Industries Corporation Bhd (BHIC) during the initial phases of the project, as mentioned by a news report in 2012.
From 2012 to 2017, he was also a director at Contraves Electrodynamics Sdn Bhd (CED), the company which was incorporated less than two months before it was awarded an RM1.185 billion contract to implement vital defence features for the LCS, as reported by The Vibes yesterday.
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Meanwhile, Ramli is a former navy chief and had served as the deputy executive chairman and managing director at BHIC during his 14 years with the company from 2005 to 2019, before resigning due to personal reasons.
Ramli also assumed a directorship position at BNS during the same period and was the chairman of both the LCS Steering Committee (LCSSC) and Contraves Advanced Devices Sdn Bhd (CAD).
CAD is a company that has BHIC Defence Technologies Sdn Bhd (BHICDT) as its main shareholder.
BHICDT is a wholly owned subsidiary of BHIC, which shares the same parent company as BNS, Boustead Holdings Bhd.
‘Taken advantage’ of their roles
According to the PAC report, Anuar had “taken advantage” of his position in BNS, and abandoned the norms of corporate governance to issue various award letters (LoA) and variation orders (VO) supported by Ramli.
It also detailed how the LCS technical and commercial committee (LCSTCC) had been prevented from carrying out its roles to evaluate the aspects of the project, while BHIC’s legal adviser was not consulted on reported weaknesses contained in the LoAs.
The report also noted that Anuar was apparently never reprimanded for his conduct despite many written complaints being lodged against him.
Testimonies provided by former LCSSC members revealed that the committee’s independence had been compromised by Anuar, as he had not only determined the composition of the evaluation team, but had also repeatedly overruled its decisions.
The PAC report also said that Anuar had been holding private talks with Ramli, leading to the LCSSC only finding out about numerous resolutions after the two men had discussed the matter beforehand.
The two appear to have attempted to dodge queries from the LCSSC by minimising the number of committee meetings and often postponing them if Ramli was unable to attend, despite purchase orders and LoAs being issued more frequently.
Based on probes conducted by independent auditors Alliance IFA (M) Sdn Bhd, Ramli had released progress payments to CAD and CED solely on the recommendation of Anuar, while dismissing letters by whistleblowers regarding red flags in the LCS project.
Ramli had also gone against the LCSTCC by issuing LoAs to certain companies, the PAC report noted.
Furthermore, the report cited a previous forensic audit finding, which accused Anuar of acting as though he and Ramli were the two sole stakeholders in the company, ignoring the input of subordinates.
The finding highlighted that by having major control over the decisions made in the procurement process, there was a high risk of Anuar abusing his power for personal gain.
Meanwhile, the PAC report also found that six months after BNS issued an LoA for an RM1.185 billion package to CED, Anuar and Ramli had independently issued a supplemental LoA for another package worth RM305 million to the same company.
Separately, the report noted that within his capacity as BHIC chairman, Ramli had suggested converting the currency for a separate LCS LoA from ringgit to euros, a decision that caused BNS to suffer RM13.5 million in losses.
The design contract for the supply of the LCS – which was initially valued at RM178 million but had increased to RM1.36 billion due to numerous VOs – was also not properly negotiated by Anuar due to his lack of expertise on the matter. – The Vibes, August 12, 2022
Additional reporting by Qistina Nadia
The report above is the second of a series by The Vibes on the LCS scandal. The first and third part can be read here and here.
