Friday, January 30, 2015

Tufail Mahmud – How I Evaded Tax On My Secret Timber Concession!

Tufail Mahmud – How I Evaded Tax On My Secret Timber Concession!
In the family jet - Tufail will be questioned in the latest round of court actions by his former Sanyan business associate, whom he has driven out of the company
In the family jet – Tufail will be questioned in the latest round of court actions by his former Sanyan business associate, who says he has driven him out of the company

The brother of Governor Taib Mahmud, Tufail, is due to appear in a Singapore High Court today to be questioned in a case brought against him by former business associates.

However, papers already deposited before the session in Court 5 contain a series of astonishing admissions by Tufail, where he openly details how he illegally evaded paying tax on his timber profits made out of Sarawak.

The complex case, which opened earlier this month, was brought by a Singapore company called Tanaka, of which Tufail is himself a director, against both himself and a fellow director of Sanyan Sdn Bhd, Dato Ting Check Sii.

The majority of the three shareholders of Tanaka are suing to be paid back money, which they say was lent to Sanyan for ventures in Sarawak on the understanding it would be repaid.
However, the minority director Tufail, who now controls Sanyan and has evicted Ting from his former positions in the company, is refusing to comply.

It was during his earlier, written submissions to the court over this dispute, that Tufail detailed how for many years he declared his sales on timber from the state at only a “fraction of the actual price” to the Malaysian tax authorities.

It means that the people of Sarawak were denied their rightful profits from this logging of state lands – concessions which had been granted to Tufail by his own brother the Chief Minister of the time

Tufail Mahmud’s tax dodging scams on Sarawak timber sales

Fruits of the forest - Tufail's massive Sibu mansion built thanks to his privileged concessions handed from the state by his brother
Fruits of the forest – Tufail’s massive Sibu mansion built thanks to his privileged concessions handed from the state by his brother
Tufail’s tax-dodging scam, according to his own statement to the court, was to ‘sell’ the timber from his companies Sanyan Sdn Bhd and Sanyan Sawmill Sdn Bhd to a so-called ‘agent’ in Singapore, which in turn re-invoiced the end buyers in places like China and Japan for a much larger sum.

That ‘broker’, a company called Tanaka, turns out to have also been owned by himself and his business associates!

By this method (politely known as ‘transfer pricing’) Tufail and his fellow shareholders cheated the people of Sarawak out of tens of millions of ringgit of tax by hiding the extent of their real profits.

It is a practice that has been seen as commonplace for the major timber companies, who tend to habitually declare pathetic profits or even losses each year, even though Sarawak is still the largest tropical timber exporter in the world.

According to Turfail’s submissions, his bent business then used these secret profits to plough into other ventures in Sarawak, such as the Sanyan Tower in Sibu, in which they again enjoyed favoured status, thanks to the influence of Tufail’s brother Taib Mahmud.

This is how Tufail described what he was doing to the Singapore court:
Tufail is sued for breech of promise.
Tufail is sued for breech of promise by his own company Tanaka (the Plaintiff) for breech of promise and explains his practices…….
Selling to his own company for "a fraction of the actual price" to "limit his liability for tax in Sarawak, Malaysia"
Selling to his own company for “a fraction of the actual price” to “limit” his “exposure to tax liability in Sarawak, Malaysia”
The  un-repentent admission is likely to provoke outrage from ordinary Sarawak folk, who have seen endless favours granted to Taib’s family, only to be cheated further by such meanness in evading tax.

‘Transfer pricing’ was the practice spelt out by Taib family lawyer Alvin Chong in Global Witness expose

Taibs cousins explained how the family cheats in this secret recording
Taibs cousins explained how the family cheats in this secret recording
This flagrant practice of transferring profits away from Sarawak, in order to avoid tax, was of course described as a standard manoeuvre for Taib family hangers-on by cousins of the Chief Minister, when they were secretly recorded during a separateGlobal Witness expose back in 2012.

They and their lawyer Alvin Chong are seen on video laughing and joking as they tell an investigative reporter that no one who is ‘connected’ in Sarawak seriously pays tax on the lands and favours they have grabbed, thanks to their relationship to Taib.

This is because they only receive a fraction of the actual price of land and products in Sarawak – the rest is paid offshore, in such places as Singapore.
Taib family lawyer Alvin Chong explained the Singapore Scam, while sneering at the 'blind' Dayak who fail to see they are being robbed by their leaders
Taib family lawyer Alvin Chong explained the Singapore Scam (transfer pricing), while sneering at the ‘blind’ Dayak who fail to see they are being robbed by their leaders

The biggest victims of this tax evasion are of course the wider public, who are thereby deprived of funds for services like health and education.

In the Global Witness video the Mahmud cousins were not only caught discussing their scheme to evade taxies in this way (by selling on a cheap oil palm concession through Singapore) they chose to describe the native customary land owners of the territories concerned as “squatters”.

They also sneered at the local ‘nominees’ whom they had hired to disguise their shareholdings, calling them “one-eyed in a land of the blind” – a reference to ordinary folk, who do not realise how badly they are being robbed by the Taibs and others in power in the State of Sarawak.

Secret timber concession

The Singapore court case is one of several waged against Tufail by former business partners and these have revealed another disturbing deception by Taib’s brother.

Tufail was also hiding his ownership of a lucrative timber concession granted by Taib, according to separate court papers. Sanyan Lumber Sdn Bhd was the name of the concession, which was the source of much of the money flowing through Tanaka Lumber in Singapore.
Morshidi bin Omar was a proxy to conceal Tufail's timber concession
Morshidi bin Omar was a proxy to conceal Tufail’s timber concession – but Tufail was the signatory on the bank accounts!
Tufail is not listed as a Director or Shareholder of the company, however, his partner Dato Ting Check Sii, has confirmed that he was indeed the 50% shareholder, which provided the key source of timber behind Sanyan’s exports:
“In 1987, I set up Sanyan Lumber Sdn Bhd which was given a timber concession.  The shares of this company are held by me (50%) and Draman @ Morshidi bin Omar (50%) (as nominee of Datuk Tufail).  Datuk Tufail told me that he needed to use a nominee  because his brother was then and still is the Minister for Resource Planning.  Datuk Tufail now denies Draman is his nominee, even though Datuk Tufail and I are the only joint bank signatories for this Company”. [Submission by Dato Ting to Sarawak High Court]
In other words Mr Bin Omar was merely a nominee, of the sort described by Alvin Chong as a one eyed man in the land of the blind (meaning the Dayak of Sarawak, who were allegedly unaware how they are habitually cheated in this way).

In fact, Ting’s submissions to the court make clear that Tufail’s primary role in the Sanyan business empire was to make sure it obtained favour in securing those vital timber concessions from his brother. Tufail never actually did any of the work in the company and he never invested any of his own money:
Tufail tasked with getting concessions off his brother
Evidence from Dato Ting that Tufail was tasked with getting concessions off his brother for SWI (Sanyan Wood Industries)
Tufail himself has admitted to the court in his own written submission for the current case that he barely did a thing towards running the business itself:
Tufail did not invest money or bother to manage the businesses.  But he was always a signatory to cheques and held more shares... because his job was to get timber concessions off his brother!
Evidence from Tufail – Dato Ting is the 2nd Defendant, whom Tufail admits did all the work and invested all the money, even though Tufail was always a signatory to cheques and held the most shares… his only job was to get timber concessions off his brother!

How much was Tufail fined?

There is one major gap in the otherwise shockingly frank evidence given in this case by Tufail about his tax dodging, which is how much he was fined after he got caught?
Squeezed out - former partner Ting Check Sii is looking for the return of his investment
Squeezed out – former partner Ting Check Sii is looking for the return of his investment

Taib’s brother admits in his evidence that in the late 90s the Malaysian finance authorities spotted what he was up to and proceeded against his company Sanyan.

The outcome was negotiated and the company was indeed fined for this illegal behaviour, according to Tufail’s own narrative.

But Mr Mahmud does not say by how much he was fined, leaving onlookers to speculate that Taib’s brother may have got off very lightly indeed.

After all, according to the court papers, Tanaka had secreted some USD$10million from under the noses of the Sarawak authorities by its false invoices and accounting and then re-invested it in the Sanyan Tower and other enterprises.

These enterprises remain in the hands of Tufail, so how much was he actually forced to pay back?

Don’t the public have a right to know if a settlement was reached that was below the amount he would have paid had he honestly declared his taxes?  Under normal circumstances Sanyan ought to have paid a substantial fine of top of the taxes, after all.

Breech of promise along with tax dodging

Amongst the sorriest victims of Tufail’s activities have turned out to be his own former business partners, according to the submissions in this and other cases between him and fellow directors in Malaysia.
Tallest building - built from money hidden from Sarawak's tax authorities and now home to several state government offices in Sibu
Sanyan Tower – Sarawak’s tallest building, built from money hidden from Sarawak’s tax authorities and now home to several state government offices in Sibu
Those entrepreneurs, who needed to give a majority share of their business to a lazy Mahmud family member, in order to have a chance to get concessions and do business in Sarawak.

After their usefulness was over and the business was built, their submissions complain that Tufail squeezed them out like a cuckoo in their nest.

In this latest Singapore complaint Tufail stands accused in a complicated claim of a breech of trust for not having fulfilled an alleged commitment by Sanyan to pay back the money invested from Tanaka within 18 years (a period now expired).

But from the point of view of people in Sarawak, the real outrage is the way this case reveals, yet again, how the state has been corruptly managed by Taib Mahmud for the benefit of his own family businesses.

So far all the legal actions against Tufail have been lost in the Sarawak courts, perhaps unsurprisingly given the Taib family’s influence.

It remains to be seen whether the case in Singapore will obtain a long awaited victory for his discarded former business partners. It’s clear that even the winners in Taib’s Sarawak are in danger of becoming losers, unless they are part of the Taib family themselves.

~ Sarawak Report

Anwar: Pakatan can stand without me



PUBLISHED: JANUARY 30, 2015 12:13 PM
If Anwar fails to reverse the Court of Appeal’s five-year imprisonment sentence and conviction, the 67-year-old would lose his Permatang Pauh parliamentary seat. — file picture
 If Anwar fails to reverse the Court of Appeal’s five-year imprisonment sentence and conviction, the 67-year-old would lose his Permatang Pauh parliamentary seat. — file picture

KUALA LUMPUR, Jan 30 — Datuk Seri Anwar Ibrahim has expressed confidence that the fledgling Pakatan Rakyat (PR) opposition pact will hold strong if he goes to jail for sodomy, despite tense ties between DAP and PAS.
Anwar pointed out to DAP organ The Rocket in an interview published today, ahead of the Federal Court verdict on February 10 in his second sodomy case, that he was already in prison when the loose coalition of PKR, PAS and the DAP was formed.
“So this isn’t something new,” Anwar was quoted saying.
“Some say my entry to jail may even fortify and strengthen Pakatan, because there will be a rallying point. So I always view it in the positive,” the PKR and PR de facto leader added.
In the watershed Election 2008, PKR, DAP and PAS had agreed to cooperate and not to contest against each other, resulting in the ruling Barisan Nasional (BN) losing its customary two-thirds majority in Parliament and the subsequent creation of the PR alliance that gained more ground in Election 2013.
However, Anwar’s comments today come even as the DAP and PAS are embroiled in a public spat over the former’s push to restore local council elections, an attempt which PAS president Datuk Seri Abdul Hadi Awang claims will lead to a repeat of the May 13, 1969 race riots.
DAP assistant national publicity secretary Zairil Khir Johari even told PAS secretary-general Datuk Mustafa Ali today to sue his DAP counterpart Lim Guan Eng or resolve the disagreement over local government polls privately.
On Wednesday, Mustafa challenged Lim, who is also Penang chief minister, to an open debate on hudud and local government elections two issues that have brought the two parties to loggerheads on numerous occasions.
The Rocket reported today that Anwar had tried to convince DAP leaders at the party’s national leadership retreat that PAS would stick to PR.
“We (see it) as our duty to save the nation. Is Pakatan strong enough to do that? Yes we have to (be). We are gaining, and that’s why I think it is important to maintain the cordial relationship between the parties,” Anwar was quoted saying.
The High Court had, in 2012, acquitted Anwar of allegedly sodomising his former political aide Mohd Saiful Bukhari Azlan in an upscale Bukit Damansara condominium on June 26, 2008.
But the decision was later overturned by the Court of Appeal and the opposition leader was subsequently sentenced to a five-year jail term.
If Anwar fails to reverse the Court of Appeal’s five-year imprisonment sentence and conviction, the 67-year-old would lose his Permatang Pauh parliamentary seat as the law bars anyone fined RM2,000 or imprisoned for more than one year from serving as a lawmaker.
- See more at: http://www.themalaymailonline.com/malaysia/article/anwar-pakatan-can-stand-without-me#sthash.VvUKVyB7.dpuf

Lack of academic freedom: Academics themselves to blame?


30 Jan 10:00 AM


       
  by Aziz Bari

OUTSPOKEN: The non-renewal of the contract of services for the outgoing Deputy Vice-Chancellors at Universiti Malaya (UM) became news last week. It was alleged that the reason why the government decided not to reappoint the two academic administrators of the country’s oldest university was that the two professors have not been friendly to the ruling Umno-BN government.

Given what happened in the university last year, especially the ruckus that took place at the university’s gate on the night Opposition Leader and university alumnus Datuk Seri Anwar Ibrahim was invited to address UM students, no one would dispute the claim.

However, from the strict contract’s point of view on whether or not the renewal is given is actually a matter that is entirely within the prerogative of the university owners. Even from the purist point of view which sees academic administration as something that is not central to academic career, a non-renewal is quite a non-issue.

For one thing, the very essence of the academic profession is about research and teaching most of which are done and disseminated through seminar papers and publications, be they in the form of books, chapters from books or journal articles. Hence, assuming the post of departmental head, dean or the deputy and eventually deputy vice-chancellors or vice-chancellors (or rectors) is not in his or her agenda.

That is why it is often said deanship or other administrative functions are a matter of rotation among the academics. Of course in good universities, the deanship for example is rotated among senior professors in the faculty.

As such, there is no question of outside or government interference like here in Malaysia where even the deanship, let alone the vice-chancellors or rectors need to have the Umno-BN nod. While admittedly there is no need for the candidate to be friendly to the party in power, it is crucial – from point of view of the Education Ministry - that the person to hold the post is someone who is not critical of the sitting government.

Emeritus Professor Datuk Dr Sham Shani, a former vice-chancellor of Universiti Kebangsaan Malaysia, has once said that a university is a unique place. This is because one day, one is up there as the vice-chancellor or rector and the next day, one is just an ordinary academic who goes back to his library, laboratory or class. There is no question of demotion as claimed by the portal who broke the news over what happened in UM. It is just the ordinary way of life in a university.

I remember that when I was pursuing my post-graduate studies in England and later post-doctoral in Germany and the United States, I was never aware of the dean, let alone the top brass of the university. It was not because I could not care less or anything; it was just not the culture of their universities to gossip about who and who occupies the chancellery or dean’s office. And of course their vice-chancellors or deans do not behave like ours here. They consider themselves as colleagues to their fellow academics and are just there in the office for a certain period of time.

Here, those in power seem to have turned their back on academic freedom and treated universities as a mere extension of the bureaucracy. And it must be conceded that the majority of academics are quite naïve about it. Some have indeed become the pawn of the game. This explains the politics among some of the academics who lobbied their way up to the office.

What about student activism; namely student politics and elections, and so on? These have got little or nothing to do with academic freedom that is primarily concerned with research and teaching. In short, academic freedom is mainly about the academics and their academic pursuits. While it is true that the way the government dealt with Professor Datuk Dr Mohammad Redhuan Othman of Umcedel was against the notion of academic freedom, what they did to Fahmi Zainol, president of the UM Students Union was not.

However, this does not mean that Umno-BN was right for they have denied Fahmi and his friends their constitutional rights.

Be that as it may, in a truly democratic society and in good universities both Redhuan and Fahmi should have been allowed to go on with their pursuits. Indeed they should have been given assistance instead of being punished.

Dr Abdul Aziz Bari is formerly IIUM law professor who now teaches at Unisel. He is also Senior Fellow at IDEAS.
- See more at: http://www.theantdaily.com/Main/Lack-of-academic-freedom-Academics-themselves-to-blame#sthash.oUIAbpSK.dpuf

Let us recapture those happy days of the way we were


Last updated on 29 Jan 08:51 AM


 
         
OUTSPOKEN: For decades, we watched as Malaysia was overwhelmed by racial and religious extremists. Recently, we wondered if there was anyone who could lead the nation through its darkest hour.
Some of us may remember being united, at the formation of Malaysia, against a colonial power, the British; but 57 years later, we are still gripped by another form of colonial rule, the enemy from within, which is Umno-Baru. Dissension and tolerance are both prohibited. Anyone who opposes the administration is silenced by the Sedition Act.
Ever since the 1970s, many of us have felt that we were seeing the end of the era of the multiracial and secular Malaysia. Did we say farewell to the Malaysian dream, at the death of Tunku Abdul Rahman? Not necessarily, because in December 2014, we were given a lifeline, when 25 voices of moderation arose. 
Noor Farida 
Former ambassador, Datuk Noor Farida Ariffin, a member of the group of 25 prominent Malays dubbed the “Eminent 25”, has said that their group is speaking-up for peaceful dialogue and rationality.
She said, “I remember when I was growing up in the 1960s and 1970s, we didn’t have supremacist groups, there was so much tolerance and mixing between the races. It is because we are patriots and we love this country that we are standing up to call for the return of moderation for the benefit of all Malaysians, before it is too late.”
As 2015 begins, the Eminent 25 have grown in number. Their presence gives all Malaysians hope. They are waiting to speak with Prime Minister Datuk Seri Najib Abdul Razak, but will he seize this golden opportunity? Or will he be crippled by indecision and his penchant for brooding and silence, in the hope that the Eminent 25 will give up and go away?
When you look back at the 70s, as Farida recalls, Malaysia was a different country, not just in its countryside or the urban areas, or its dress code and racial and religious make-up, but also in its moral and cultural attitudes. Will we ever recapture those days? Today’s generation do not know the Malaysia that was vastly different from the one they know today.
It was a country in which women wore the selendang (scarf) and there was no peer pressure to cover themselves from head to toe, for the purposes of promotion or career advancement. Malay girls did sports at school and wearing shorts or short sleeved shirts, was not an issue.
Several thousand schoolchildren went to mission schools and Malay parents did not worry that the crucifix or The Lord’s Prayer, would convert their children. Children were not ashamed to communicate in English, unlike today. In those days, parents wanted a good education for their children. When English was sidelined in favour of Malay, in the seventies, the elite started to send their children to international schools or overseas. The irony is that today, many non-Malays speak better Malay than the Malays, and are well versed in at least three languages.
Family time was important, then. Today’s rat-race means parents are too busy to tend to their children. At night, the exclusive clubs, in KL’s golden triangle, are the preserve of the children of the rich and famous, including and especially children of the political elite. For the less well-off, there is always the 24-hour mamak stall. The end result is the same. Many of today’s parents do not know where their children are, nor what they get up to, at night.
Pornography was hardly known, and although religion was important, it was not used to isolate communities or pit one against another. Today, it is alleged that the conservative state of Kelantan holds the highest rate of housewives who have HIV/Aids, people involved in incestuous relationship and sexually transmitted diseases.
Most Malaysians had not travelled on an aeroplane. Now, despite their ability to travel and see the world cheaply, some have not learnt to shake off their bad Malaysian habits. Malaysian students cluster into their racial groups at universities overseas, and recently, someone wrote to say that, at the Bicester Village shopping outlet in England, one Malaysian wanted to know if the food was halal. Instead of asking nicely, he simply grunted “Halah ah?”
It took a few grunts before the proprietor of the food stall understood him. In typical Malaysian fashion, he was also seen rummaging through the fridge, behind the counter, instead of waiting to be served.
We used to communicate verbally, but today, sending text is the norm. Human contact is avoided.
Many revere people with a “Datuk” or “Tan Sri”, but treat others shabbily. In reality, the titles mean very little these days; they are offered for a sum of money.
Money is useful in many ways, like helping the poor uplift their lives, but politicians are the most despicable for corrupting the ordinary people by using money to buy votes.
Illegal immigrants are treated better than non-Malay Malaysians, and are given an identity card, voting rights and opportunities in business. We have forgotten the importance of our cultural and religious values, many of which we once held dear.
In the past, police outriders were reserved for the Yang di-Pertuan Agong, but today, even the ministers’ children brag about using police outriders.
On the sporting arena, any Malaysian, who excelled in his particular field, could represent the nation. Today, only a certain race is allowed to predominate. This bias starts in school and the discrimination means that talent is neither recognised, nor nurtured. Today, this discrimination is also prevalent in the civil-service.
What use is the gleaming architecture of the Petronas twin towers when we are bankrupt of social and cultural mores? The homeless are banished from our city centres because they are unsightly.
Of course, not everything from the 60s and 70s was good, but are we too arrogant to learn from the past. Will Najib meet the Eminent 25 soon and move Malaysia forward?
Mariam Mokhtar is "a Malaysian who dares to speak the truth.”
- See more at: http://www.theantdaily.com/Main/Let-us-recapture-those-happy-days-of-the-way-we-were#sthash.pEoFsOHN.dpuf

Gross abuse of power against cartoonist Zunar

7:21PM Jan 29, 2015
By Suaram
Suara Rakyat Malaysia (Suaram) strongly condemns the continuous harassment and gross abuse of power by the police against political cartoonist Zulkifli Anwar Ulhaque, better known by his pen name Zunar. We demand that the police and home minister return all confiscated books to Zunar and to cease all form of harassment against Zunar.

The raiding of Zunar's office’s on Jan 28, 2015 is unreasonable and can only be described as pure harassment. The authorities need to be reminded that Zunar, as a citizen, has rights guaranteed under Article 10 of the federal constitution to freely exercise his right to freedom of expression. It is against common sense to argue that political satire cartoons can be detrimental to public order and it definitely cannot be held to be a threat to national security.

It is ludicrous and unacceptable that no warrant was produced by the police before conducting the search. The police had in late 2014 investigated Zunar, his assistants and webmasters under three different legislations - the Sedition Act 1948, the Printing Presses and Publications Act 1984, and Section 500 of the Penal Code.

The investigations were done over two books - ‘Konspirasi Memenjarakan Anwar’ and ‘Pirates of the Carry-BN’ - the same titles that were confiscated by the police on Jan 29, 2015. There has been no further follow-up from the police since the statements were taken. This sudden raid and confiscation of Zunar’s books is highly suspicious and appears to be part of the government’s ongoing campaign to halt Zunar’s expressions and ideas from reaching others.

For the longest time, Zunar has been attacked by the police and the Home Ministry for producing cartoons that were purported to be detrimental to public order. More than 400 copies of his books were confiscated and five of his books titled ‘Perak Darul Kartun’, ‘1 Funny Malaysia’, ‘Isu Dalam Kartun’ Vol 1, 2 and 3 were banned by the home minister from 2009 to 2010.

The government's determination to persecute Zunar was extended to printers, vendors and bookstores around the country - their premises were raided and they were warned to not print or carry any of Zunar’s books in the future.

The police’s conduct contradicts the Court of Appeal’s ruling on Oct 9, 2014, which lifted a ban imposed by Home Minister on two of Zunar’s cartoon books ‘Perak Darul Kartun’ and ‘1 Funny Malaysia’ on grounds that they were not a threat to national security or prejudicial to public order.

In delivering his judgement, Justice Mohamad Ariff stated that the law should not be abused by the executive and that public odium cannot be so conveniently equated with public order. Nevertheless, the Home Ministry, in a letter dated Nov 10, 2014, informed Zunar and his lawyer that they are appealing at the Federal Court to have the Court of Appeal’s decision struck out, insisting that Zunar’s cartoon satire is prejudicial to public order.

In  recent years, the government has increased its efforts in curtailing freedom of expression, predominantly under the Sedition Act and alternatively under the Penal Code, Communications and Multimedia Act 1998 and Printing Presses and Publications Act 1984.

It is extremely disappointing that individuals who fearlessly speak up and express their thoughts are deemed as criminals by the authority. The government, by doing this, is putting itself in the same category as tyrannical and repressive regimes. No one should be subjected to intimidation, criminalisation and imprisonment for producing satirist cartoons, which are a legitimate expression of political opinions through the form of art.

Freedom of expression is a defining attribute of democratic states and political satire is a bellwether of the extent of openness of a country. Suaram hereby urges the government to immediately cease all form of harassment and prosecution against Zunar and to return all confiscated books, as well as to respect our rights to freedom of expression.
~ Malaysiakini