Thursday, September 20, 2012

The Taib family and modus operandi

Continued from The Taib Timber Mafia

Chief Minister Abdul Taib bin Mahmud (Taib) is the eldest of 10 children born to Mahmud Abang Yahya and Wan Hamidah in Sarawak, on 21 May 1936.

To understand the relevance of Taib’s  family connections, we need to look at his relationship to the previous Chief Minister of Sarawak. Abdul Rahman Ya’kub, the third Chief Minister of Sarawak is Taib’s uncle. It was through this connection that Taib entered politics in 1963 and which ultimately led him to his thirty year grasp of power over Sarawak.

Taib  concurrently holds the offices of Chief Minister, Finance Minister, as well as that of State Planning and Resources Minister, which gives him enormous  political  and economic power. Sarawak's largest private company, large-scale logging  and plantation interests and the control of log exports are concentrated in the hands of the Taib family. One of the Chief Minister’s brothers, Mohamad Ali, and one of his sons, Sulaiman, have also been involved in politics and one daughter, Hanifah, and a first cousin, Hamed Sepawi, run various media outlets in Sarawak.

In  1995, Asiaweek identified nine  "political warlords" in Asia, Taib Mahmud was described as having "no private army, but he runs the closest thing to a Malaysian political fiefdom. Kuala Lumpur leaves the Sarawak chief minister alone in return for keeping the state sweet at election time“.

Taib has  recently been described by Singapore-based political scientist Faisal S. Hazis as having "total control over Sarawak."

Despite earning a moderate official salary per year in his role as Chief Minister of Sarawak, MYR 590,000 (USD 194,000), Taib is known for his magnificent wealth and string of assets. 

He is often seen travelling in a Rolls Royce, sporting a designer suit, wearing a walnut-sized ruby ring and he is residing in a well-guarded palace-like mansion in Kuching.

Famously, in 2010 he told rural voters in Sarawak: "I have more money than I can ever spend."

Taib’s modus operandi

During his thirty years of iron grip over Sarawak, Taib Mahmud has systematically plundered a country once rich in natural resources, partiuclarly oil, gas and timber. While the proceeds of the oil and gas extraction are mostly benefiting Malaysia’s federal government, the Sarawak state government enjoys total autonomy as to the use of the state’s forest resources and state lands.

Taib has abused his position as Chief Minister, State Finance Minister, and Planning and Resources Minister, to award his family members vast timber concessions, palm oil concessions, state contracts and directorships in Sarawak’s largest companies. In 2009, his three ministries controlled 49.6% of the state’s operating expenditure of MYR 1.19 billion (USD 391 million) and 80% of the state’s development expenditure of MYR 3.08 billion (USD 1.01 billion), with the other ten ministers sharing the rest.

Taib’s position as Planning and Resources Minister means that he has ultimate control over the granting of timber concessions in Sarawak that are worth several billion dollars. Already in the late 1980s, family members and clients loyal to Taib Mahmud were estimated to control over 1.6 million hectares of timber concessions in Sarawak. That constitutes more than 10% of the total land mass of Sarawak. Political observer Daniel Lev has described how Taib abused his power over the allocation of timber concessions in Sarawak: “Timber rent is used by the national ruling party for political expenditures during election time and for financing business objectives of ruling party linked conglomerates.”

In 2011, the Bruno Manser Fund released information detailing the Taib family’s connection to over 400 companies in 25 countries and offshore districts.

These include many offshore finance centers such as the British Virgin Islands, Jersey, Bermuda and the Cayman Islands.

Although Taib’s own name is rarely listed as a director or shareholder, it is his family members who are known to act as nominees for the Chief Minister. A 2001 PhD thesis by US economist David W. Brown, states that: "While the Chief Minister himself occupies no publicly recorded directorships or shareholdings in any of the timber concessions said to belong to him, the Chief Minister's family members....occupy managerial..positions on the boards of the timber concessions of the top four major Sarawak timber conglomerates."

The Taib family runs a well-diversified financial empire with interests in Sarawak’s largest timber and logging companies (Ta Ann, Samling, WTK, Sanyan), monopolistic control of log exports (Achi Jaya Transportation), plantations (Sarawak Plantation), construction (Cahya Mata Sarawak Berhad, Naim Holdings, Titanium Management), electricity supply (Sarawak Cable, Sarawak Energy), property development (Custodev, Kumpulan Parabena) and state media (Cats FM, New Sarawak Tribune) to name a few.

The flagship of the Taib family empire is the largest private company in the state, Cahya Mata Sarawak Berhad (CMS), with net assets totalling 2.4 billion Malaysian ringgit (USD 788 million) in 2010. CMS has been awarded some of the state’s largest contracts including the MYR 300 million (USD 98 million) construction of the State Legislative Assembly building in Kuching, a contract over the maintenance of all state roads in Sarawak (4000 kms) and a 15-year concession to maintain 643 kms of federal roads.

Commonly referred to as "Chief Minister and Sons", the Taib family own over 80% of CMS, but recent annual reports have raised questions over the true beneficiary of the company’s wealth. In 2009, Taib’s first wife Lejla Chalecki died.

Since 2002, she had been the single largest shareholder of the company, but CMS’ latest annual reports still list her as a major shareholder.

The largest shareholder of CMS is Majaharta Sdn. Bhd. which is jointly owned by Taib’s two daughters, Jamilah and Hanifah.

Since his appointment as Sarawak Chief Minister in 1981, Taib and his immediate family members have transferred considerable parts of their ill-gotten assets overseas to countries including Canada (Sakto group of companies), the United States (Sakti Corporation and related companies), Australia (Sitehost Pty Ltd), the United Kingdom (Ridgeford Properties), Hong Kong (Richfold Investment Ltd.) and to a number of offshore finance centers, namely the British Virgin Islands. While the above-mentioned companies officially name Taib family members as their shareholders or directors, it is believed that many other companies are held through nominees.

Sakti International, a US property development company owned by the Taib family was incorporated in 1987 in California. In a court deposition, Sakti admits that "beginning September 10, 1987, Sakti’s designated Chief Executive Officer, Secretary and Chief Financial Officer was Mahmud Taib", the Chief Minister’s son.

Significantly, the deposition also admits that the shareholders of Sakti are none other than Taib’s children and brothers. Whilst it is Taib’s relatives who are publicly registered as the official shareholders and directors of the companies, a private agreement ensures that the shares are actually held in trust for Taib.

Official documents leaked by a former employee prove that it is a system of private deals that ensures that half of these shares „are held in trust for the Chief Minister.“

One of Sakti International’s early public documents lists the Chief Minister as a director.

The Ottawa (Canada) - based Sakto group of companies, mainly active in real estate and property development, is currently run by daughter Jamilah and her Canadian husband, Sean Murray.

In 2011, Sean Murray stated that "Sakto, Sakti and Ridgeford are not and have never been funded by Mr Taib Mahmud" but later that year Taib admitted on video that he had given money to his daughter to start the business “It started 20 to 30 years ago. I gave money to my daughter because I was resigning from Federal Government. I got a gratuity and gave some money to her to start a new business, it thrived. It got successful and from successful they go to do business in London”.

Continued from Taib Timber Mafia and
“Stop Timber Corruption” Campaign

What is a “PEP”? There is no single, universally agreed upon definition of a „politically exposed person“ (PEP), a term that has recently become key for international anti-corruption and anti moneylaundering efforts.

By way of example, the term „politically exposed person“ (PEP) has been defined by Swiss authorities in the relevant Anti-Money Laundering Ordinance, as follows:
• Persons holding prominent public positions such as „Heads of State or Government, senior politicians at national level, senior government, judicial, military or party officials at national level, senior executives of state-owned companies of national importance“ and
• „Companies and people identified as having close family ties or personal or business connections to the aforementioned persons.“

Other countries are using similar definitions. It is important to note that not only leading politicians but also their family members or close business associates have to be regarded as PEPs

Continue from Taib Timber Mafia.

Many public sources have been used for this report. Apart from newspaper articles and reseach papers, this report draws specifically on the following sources:

- Sarawak Report, a campaign website run by British journalist Clare Rewcastle Brown.
- Court depositions by former Taib family employees and business partners:
- Ross J.Boyert: former Vice President of Taib family-owned Sakti International Corporation in California, US12
- Ting Check Sii: former owner of now Taib family-controlled Sanyan Sdn. Bhd in Malaysia.
- Farok Majeed: former business associate of Onn Mahmud in Singapore and Australia.
- The late Ross J. Boyert, former Vice President of Taib family-owned Sakti International Corporation in United States.
- Official company commission documents from Malaysia (Suruhanjaya Syarikat Malaysia), Australia (Australian Securities and Investments Commission), United Kingdom (Companies House), United States of America (California Secretary of State), Canada (Industry Canada) and Hong Kong (Registrar of Companies, Hong Kong).
- Company Annual Reports.
- David Walter Brown: “Why Governments Fail to Capture Economic Rent: The Unofficial Appropriation of Rainforest Rent by Rulers in Insular Southeast Asia Between 1970 and 1999”, ph.D., University of Washington, 2001.
- Michael L. Ross: Timber Booms and Institutional Breakdown in Southeast Asia, Cambridge: Cambridge University Press, 2001.
- Andrew Charles Bernard Aeria: “Politics, Business, The State and Development in Sarawak, 1970-2000”, ph.D., London School of Economics, 2002.
- Further literature, video interviews, research reports, newspaper and magazine articles.

Continued from Taib Timber Mafia and
“Stop Timber Corruption” Campaign

The aim of this report is to build up international pressure against the corrupt Taib family and provide investigating bodies, journalists, Sarawakians and interested parties with detailed evidence on the Taib financial empire. It aims to demonstrate the financial and political control that Taib has over Sarawak and provide profiles on the Chief Minister and his family members, all of whom have financially benefited from the destruction of Sarawak’s rainforest.

We believe our research is showing merely the tip of the iceberg as many family assets are likely to be hidden overseas or in offshore districts where information is virtually impossible to obtain. The Bruno Manser Fund is therefore calling on anti-corruption and anti-money-laundering authorities worldwide to investigate the Taib family’s business activities.

These assets should be frozen and restituted to the people of Sarawak, and the Taib family and their co-conspirators should be prosecuted for corruption, abuse of public funds, fraud, money laundering, tax evasion and other related crimes.

Continued from The Taib Timber Mafia

The “Stop Timber Corruption” Campaign

On the 18th February 2011, the Bruno Manser Fund launched a campaign to “Stop Timber Corruption”, focused on the Chief Minister of the Malaysian state of Sarawak, Abdul Taib Mahmud (“Taib”). Since 1981, Sarawak has been governed by Taib, an exceptionally powerful and corrupt man, who has abused his public office in a spectacular way to enrich himself and his closest family members.

While Taib and his family members have personally profited immensely from the destruction of the Borneo rainforest through logging and oil palm plantations, Sarawak’s indigenous communities have lost their land, the source of their livelihood and have been increasingly marginalized. IWGIA’s Report “The Indigenous World – 2012”, states, „Taib Mahmud and his family are causing discontent among the indigenous peoples and civil society in general.

The Stop Timber Corruption campaign has built up international pressure against the corrupt Taib family and pressure to put a stop to timber corruption in Sarawak.“

Abdul Taib Mahmud has been Chief Minister of Sarawak since 1981 and is concurrently Finance Minister and Planning and Resources Minister of Sarawak. He has long been criticized for corrupt practices and abuse of office but Malaysian authorities have failed to take action against him, despite an ongoing investigation by the Malaysian Anti Corruption Commission (MACC), Taib and his family members have illegally acquired assets worth billions of dollars in Malaysia, Canada, the UK, Australia, the United States and other countries. As part of the campaign, BMF conducted research into Taib business in Malaysia and overseas which uncovered the vast dimensions of the family’s illicit assets. The findings exposed that Malaysian potentate “Taib” and his family have a stake in over 400 companies around the globe and hold illicit assets worth several billion US dollars.

Read also The aim of Taib Timber Mafia report

The Taib Timber Mafia - Facts and Figures on Politically Exposed Persons (PEPs) from Sarawak, Malaysia report by Bruno Manser Fund is now out.

Sarawak, an environmental crime hotspot

Sarawak is the largest of Malaysia’s thirteen States and one of two States located on the island of Borneo. Sarawak is located immediately north of the Equator between latitude 0° 50° and 5°N and longitude 109° 36' and 115° 40' E. It stretches some 800 kilometres along the northwest coast of Borneo, covering an area of 124,449.51 square kilometres.

The rainforest of Borneo is acknowledged to be among the “worlds most distinct and speciesrich”, a hotspot of biodiversity. Sarawak is divided into three regions - coastal lowlands comprising peat swamp as well as narrow deltaic and alluvial plains; a large region of undulating hills ranging to about 300 metres; and the mountain highlands extending to the Kalimantan border.

The highest point of Sarawak is Mount Murud reaching 2,423 meters. Flora in Sarawak includes roughly 8,000 species of vascular plants, 2,000 tree species, 1,000 orchids, 757 ferns and 260 species of palm. Fauna in Sarawak includes roughly 185 species of mammal, 530 species of bird, 186 species of snake, 104 species of lizard and 113 species of amphibian.

Sarawak has a population of over 2.4 million and is a multicultural state with at least 27 ethnic groups, the largest of these being the Iban. The people of Sarawak practice a variety of religions including, Christianity, Islam, Buddhism, Taoism, Confucianism, ancestor worship, Baha'ism and animism.

Unlike the Malaysian states on the Malaysian peninsula, where Islam is the predominant faith, the largest religious group in Sarawak are the Christians.

Despite being described in tourism ads as a “vast wilderness” Sarawak’s lush tropical rainforests are disappearing at an astonishing rate. Former Prime Minister of England, Gordon Brown stated in 2011 that the destruction of Sarawak’s rainforest is “probably the biggest environmental crime of our times…Malaysia's once vast pristine jungle has been stripped bare and enormous areas have been planted with oil palm in an environmental nightmare that shows no sign of slowing.”

In February 2011, the Dutch NGO “Wetlands International” expressed their concern that “As the timber resource has been depleted, the timber companies are now engaging in the oil palm business, completing the annihilation of Sarawak’s peat swamp forests.”

Total deforestation in Sarawak is 3.5 times as much as that for entire Asia, while deforestation of peat swamp forest is 11.7 times as much.

The Sarawak State Planning Unit has openly expressed their intention to convert Native Customary Rights land to palm oil. In 2010, Minister for Land Development, James Masing stated that the government of Sarawak aims to convert a further 1 million hectares (2.5 million acres) of tropical forest to oil palm plantations by 2020 and that there is a need for “a more aggressive development” of Native Customary Rights land.

Read also:
- “Stop Timber Corruption” Campaign
- The aim of Taib Timber Mafia report
- Sources used for Taib Timber Mafia
- The Taib family and modus operandi

The Bruno Manser Fund is about to release an explosive report on the Malaysian Taib family, one of South East Asia's most notorious kleptocratic clans. The report entitled "The Taib Timber Mafia. Facts and Figures on Politically Exposed Persons (PEPs) from Sarawak, Malaysia" contains twenty portraits and details on the corrupt business connections of long-term Sarawak Chief Minister, Abdul Taib Mahmud ("Taib"), and his closest family members and associates. Taib is the main culprit for the destructive logging of the rainforests of Sarawak, one of the world's biodiversity hotspots.

Next Wednesday, 19 September 2012, the report will be presented in Brussels to the EU Commission on the occasion of a visit of the Malaysian Minister of Plantation Industries and Commodities, Bernard Dompok. The report will be released to the general public on Thursday, 20 September 2012, 3 p.m. GMT. So visit this site again to get the next update.

Former assistant minister Larry Sng Wei Shien was today elected Sarawak Workers' Party (SWP) president at its inaugral annual general meeting here. SWP is the latest local based opposition party in the state. Its prime mover is Larry's father, Datuk Sng Chee Hua, who is former deputy president of the Parti Rakyat Sarawak (PRS) and former Pelagus state assemblyman and Julau member of parliament. Pelagus state assemblyman George Lagong, who won as an independent in the last state election, and who recently joined the party, was also elected the party's deputy president. Its two senior vice-presidents are Josephine Randan Mawat, and William Gani Bina who is also Sarawak Teacher's Union president. The party has two other vice-presidents and 14 supreme council members who include part-time lecturer Ellison Ludan and former senior police officer Jonathan Jalin who are tipped to be its candidates for Kanowit and Lubok Antu, respectively, against PRS' Datuk Aaron Dagang and William Nyalau. Speaking to reporters, Larry, 33, maintained SWP would be a Barisan Nasional (BN)-friendly party but would contest against the state BN component party, PRS, in its six seats of Lubok Antu, Sri Aman, Hulu Rajang, Kanowit, Julau and Selangau. "We will be friendly to the rest of the state BN component parties and look forward to working with them. "We are a multi-racial party with our headquarters in Kuching...currently, we have about 10,000 registered members state-wide," he said, adding the party was also a blend of new and exprienced politicians from both urban and rural areas. Meanwhile, Larry said he would soon announce his resignation as special advisor (youth matters) to the state government.

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