Malaysia Anti-Graft Body Investigating Embezzlement Case at Sports Ministry

The Malaysian Anti-Corruption Commission is moving to interview witnesses in the case of the alleged misappropriation of 107 million ringgit (U.S. $26.5 million) from the Ministry of Youth and Sports, the head of MACC’s investigations teams said Monday.

On Friday, nine people were arrested in the case, including a 56-year-old department division head at the ministry who is suspected of embezzling 20 million ringgit ($4.95 million) since 2010.

“Witnesses expected to be called up today are from the ministry and the involved government agency,” MACC Director of Investigations Azam Baki told BenarNews, adding that he expected no more arrests to be made in connection with the allegations.

The anti-graft body said the money was channeled to companies for bogus contract programs and to the key suspect’s bank accounts.

Azam said investigators still were determining whether other companies were involved in the corruption case, other than those already identified in the probe.

“There are possibilities, of course. The MACC needs to make sure of it, we are not playing a guessing game here,” Azam said.

The department head in custody is believed to have masterminded the embezzlement, and he and the eight other suspects were remanded to MACC custody for a week, starting on March 18, according to Azam.

The unnamed main suspect used 69 bank accounts – all now frozen – to handle transactions by directing the financial department of a related agency to make payments to about 14 companies for bogus programs that were never implemented, the commission said at a press conference on Saturday.

The suspect, who had worked at the ministry since 1998, would receive his cut from the companies, some of which deposited checks into his personal bank accounts, Azam told the news conference.

The suspected mastermind also received other payments from contractors, including money spent on houses, luxury cars, insurance payments and trusts fund units amounting to millions, the MACC investigations’ chief said.

“He was able to afford expensive, branded watches; one of them priced at 400,000 ringgit [U.S. $99,000], a stack of jewelry worth not less than 600,000 ringgits [U.S. $148,000], and ‘bedding’ valued at more than 300,000 ringgits [U.S. $74,000],” Azam told reporters.

The 69 bank accounts that held an estimated 8.3 million ringgit (U.S. $2 million) were frozen under the nation’s anti-corruption, anti-money laundering acts and other laws.

On Monday, Youth and Sports Minister Khairy Jamaluddin confirmed that the department divisional head was among the suspects.

“The MACC had informed me several weeks ago of the investigation, and I had stated that the ministry and agencies under it are willing to cooperate fully as to ensure a smooth, and holistic probe,” Khairy said said.

Khairy said the ministry’s internal mechanisms as well as its management of funds would be investigated. The arrests would not disrupt the ministry’s preparation for next year’s Southeast Asian Games, which will take place in Kuala Lumpur, he added.