Prasarana to lodge MACC report after taking RM450.5 mil hit in Saudi rail project

KUALA LUMPUR – Prasarana Malaysia Bhd will lodge a report with the Malaysian Anti-Corruption Commission and Companies Commission of Malaysia over the government-linked company’s involvement in a Saudi rail project.

In a statement today, it said the decision came at the conclusion of an 18-month internal audit and forensic investigation that included an audit review by Pricewaterhousecoopers Advisory Services concerning Prasarana’s involvement in the Al Mashaaer Al Mugaddassah Mecca Metro Southern Line (MMMSL) from 2015 to 2018.

“The MMMSL project stretches from the Arafat 1 station to the Jamarat station in north Mecca. On April 16, 2015, Prasarana, through its subsidiary Prasarana Integrated Management and Engineering Services Sdn Bhd (PRIME), was awarded a three-year contract to operate and maintain the line, taking over from China Railway Construction Consortium.

“The project caused Prasarana to incur audited losses amounting to 417 million riyal (RM450.5 million) for the financial year ending December 31, 2019.”

Prasarana chairman Datuk Seri Tajuddin Abdul Rahman today said the board of directors had a meeting this morning, and was satisfied with the advice given by the audit risk committee that there are grounds to take up the matter with the authorities for investigation and legal action.

Among others, the probe reviewed MMMSL’s pre- and post-tender award processes, overall execution of Prasarana’s contractual obligations, execution of the maintenance, repair and overhaul issues pertaining to spare parts in the project, and involvement of then officers and board members of Prasarana, Rapid Rail Sdn Bhd and PRIME.

“This was a challenging investigation, as many of the key officers involved in the MMMSL project have left Prasarana and/or PRIME and/or Rapid Rail.

“The long-distance nature of the project meant that the investigations required cooperation from and assistance of previous subcontractors and consultants based overseas.

“Additionally, the investigators needed to sieve through massive amounts of documents, transferred from Saudi Arabia to Malaysia.”

Tajuddin said a board investment committee has been established to look into the company’s major investment and business ventures moving forward. – The Vibes, February 4, 2021