Transparency International Malaysia (TI-M) request for the full investigation of Transmile Group Berhad’s financial irregularities
TI-M takes a very serious view of the findings of the Moores Rowland Risk Management’s (MRRM) findings of its final report on Transmile Group Berhad (TGB).
The MRRM report shows that TGB overstated their revenue by RM 95 million in FY 04, RM 194 million in FY 05 and RM 333 million in FY 06. In addition, RM 341 million in its Property, Plant and Equipment account appeared to have been fabricated as the amount was not supported by documentations. TGB had also made payments of RM 55 million between October and December 06 and RM 134 million between March and April 07 that were not supported by payment vouchers. This would appear to be a flagrant violation of the principles of good governance, transparency, integrity and accountability which TI strongly advocates in government and businesses.
Hence, TI-M calls for a full investigation by all the relevant authorities concerning the alleged accusations. TI-M also urges that proper measures should be taken if corporate fault and corruption are proven. Ethical corporate governance is vital to the establishment, foundation and growth of a company and indeed the whole Malaysian economy. The culprits must be held accountable for their misdeeds in deceiving the public in order to gain financially by any improper means.
TI-M promotes a corporate culture which is clear of corruption, discrimination and unfair practices. Since the financial crisis of 1997 and the subsequent failures of Enron and WorldCom due to accounting fraud, corporate governance and financial regulatory requirements have been tightened in Malaysia. In spite of this, the level of corporate integrity in the private sector still needs to be improved significantly, judging by the numerous cases of irregularities in public listed companies. We therefore call for the following measures to be taken by the authorities and corporate boards:-
The introduction of Integrity Pacts (IP) in both public and private sector.
TI-M also encourages the protection of whistleblowers by appropriate laws so that they can step up and promote integrity and transparency within their organizations.
Heavier deterrence including imprisonment of corporate leaders for corporate fraud.
Corporate board to include strict measures to institutionalized integrity as part of the corporate culture through a commitment to make an integrity pledge to be observed at all corporate levels.
This case clearly highlights the lack of integrity in the business sector as well as the public sector. The integrity, accountability and transparency of our private sector will be open to wide speculation and doubt both domestically and internationally, if this matter is not treated with seriousness and utmost priority.
TI-M urges the private sector to review, reform and strengthen its commitment to promote good governance and accountability on a more substantive and sustained manner, before adverse implications on the future prospects of economic prosperity, political stability and progress of Malaysia is more adversely affected.
Indeed foreign direct investment and domestic investment as well can be seriously jeopardized if the authorities are perceived to be lacking in the political will to combat these alleged corrupt practices and corruption in general in our country.
The world is watching us on how this MRRM report will be handled by the authorities and TI-M hopes Malaysia will deliver justice well!
Issued by
Tan Sri (Dr) Ramon V. Navaratnam
President
Transparency International – Malaysia
