[UPDATED] ‘Offshore firm siphoned off RM23.37 mil from LCS project for fake services’

KUALA LUMPUR – An offshore incorporated company has now been implicated in the littoral combat ships (LCS) controversy as it allegedly transferred funds from the project to accounts overseas, PKR deputy president Rafizi Ramli claimed in his latest exposé.

Citing reports from an internal probe on the LCS project, Rafizi alleged that Malta firm Alizes Marine Ltd was one of the firms identified as being involved with fraudulent transactions amounting to RM23.37 million. 

In total, Rafizi claimed that RM192 million had been siphoned off, based on the amount paid to another company with a similar name called Alizes Marine France, minus the revenue earned that was declared to French authorities.

Invoices were sent to non-existent subcontractors for technical services, he said, and when suppliers were tracked down, it was discovered that the companies did not exist and had provided fake addresses. 

“An invoice is sent from one company but the payment instructions are for the invoice to be paid to an account registered under a firm whose name is almost the same but is actually a different entity,” Rafizi said in a statement posted on his Twitter and Facebook accounts.

He added that Alizes Marine had been named in the Panama and Paradise Papers – which exposed how offshore companies were utilised to stash away money from illegal activities around the world. 

Checks by The Vibes with the International Consortium of Investigative Journalist’s website, which houses the offshore leaks database, showed that the company was indeed mentioned in the Paradise Papers. 

Rafizi asserted that the decision to appoint the company as a subcontractor for the LCS project to supply spare parts had been made based on suggestions by French naval vessel maker Naval Group (formerly DCNS). 

The proposal had apparently been made on the grounds that Alizes Marine was a defence supplier from France with a global export licence, but using the name Alizes Marine France, he said. 

“That information is false as Alizes Marine France does not have any licence. It is just an offshore company with no operations,” Rafizi said.

He added that although the LCS project received invoices believed to be from Alizes Marine France, payments were instead made to an account in Singapore under the name “Alizes Marine Ltd”. 

Rafizi said an internal investigation had concluded that Naval Group was involved in the misappropriation of funds and quoted the report as saying: “DCNS used Alizes Marine as a front to benefit from the supply of spare parts on the arrangement made and carved in Malaysia.”

He added that investigators also uncovered how Naval Group and another French company played a part in schemes to move money from the LCS project, which goes against the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.  

“This was confirmed when investigators compared the amount of money paid by the LCS project to Alizes Marine Ltd for the supply of spare parts with the amount reported in Alizes Marine France’s financial statements between 2011 to 2015. 

“During the period, subcontractors for the LCS project paid about RM210 million to Alizes Marine France for the supply of spare parts, according to invoices sent but paid to different accounts under Alizes Marine Ltd,” he said. 

However, the PKR man said that the total revenue reported in Alizes France’s financial statements to French authorities was only approximately RM18 million. 

“This means that around RM192 million has been transferred to companies overseas and cannot be traced,” he said, stressing that such an elaborate scheme “to steal people’s funds” could not have happened without protection from those in high positions. 

He said the modus operandi used was similar to what was done with 1Malaysia Development Bhd funds.

“Fake companies are established all over the world whose name is equivalent to a company that actually exists,” he said.

“Invoices are sent from one company, on the other hand the payment instruction is that the invoice is paid to one account listed under the company of the same name but different company.” 

He also said that if schemes involving offshore firms are accused of complicity with Naval Group, which has a record of paying bribes to companies linked with former prime minister Datuk Seri Najib Razak during the previous Scorpene scandal, it would only be right for the public to demand for proper investigations. 

Last week, Rafizi had asserted that Naval Group was privy to negotiations on the government’s move to develop and procure the six LCS, even before the Defence Ministry had appointed Boustead Naval Shipyard Sdn Bhd as the main contractor. – The Vibes, August 18, 2022