Wednesday July 11, 2012

Dr Ling set to take the stand in PKFZ case to clear his name

By M. MAGESWARI
mages@thestar.com.my

KUALA LUMPUR: Tun Dr Ling Liong Sik is set to take the stand in his own defence when his trial resumes on Friday.

Those familiar with his defence strategy said Dr Ling would give his testimony under oath so that he can answer all questions from his own lawyers as well as from the prosecution before trial judge Justice Ahmadi Asnawi.

On March 9, the court ordered Dr Ling to enter his defence over three charges of cheating the Government in relation to the Port Klang Free Zone (PKFZ) project.

Sources said the veteran politician was eagerly awaiting the opportunity to take the stand to clear his name.

They said 69-year-old Dr Ling woke up at 7am on each day of the trial in order to be on time for the hearing at the KL High Court.

They expect the same to happen on Friday as Dr Ling wants the court proceedings to go on smoothly. He does not want to cause any delay for the disposal of the case.

“He has agreed to take the stand to tell his part of the story. The case has to do with the method of financing over the purchase of the land. It is highly technical and complicated. He wants to explain that he did not cheat or mislead the Cabinet,” said one source.

Dr Ling, who has always been media-friendly, is expected to explain that all involved in the calculation and implementation over the purchase of the land for the project were experts and his involvement was to give direction on policy in his capacity as minister.

The former Cabinet minister is to explain that there was no element of dishonesty on his part.

Financial experts, local and abroad, will also be brought in to testify on the calculation of discounted cash flow (DCF) formula as part of their defence to show that Dr Ling had not misled the Cabinet over the purchase of PKFZ project's land costs.

(DCF analysis uses future free cash flow projections and discounts them most often using the weighted average cost of capital to arrive at a present value, which is used to evaluate the potential for investment.)

Dr Ling is accused of deceiving the Government by not revealing to the Cabinet an additional interest rate of 7.5% annually in the RM1.088bil (at RM25psf) purchase of the land for the project at the Prime Minister's Office in Putrajaya between Sept 25, 2002 and Nov 6, 2002.

He is also accused of deceiving the Cabinet into giving consent to Port Klang Authority (PKA) to purchase the land from Kuala Dimensi Sdn Bhd.

Dr Ling also claimed trial to two alternative charges of cheating, which carries a lesser penalty.

In the prosecution's case, a former government valuer contradicted ex-Valuation and Property Services Department director-general Datuk Sahari Mahadi's statement that the RM25psf price for the purchase of 830-acre piece of land in Pulau Indah included the total interest element.

Its former deputy director-general Datuk Mani Usilappan, who had written the valuation letter in question, had told Justice Ahmadi that he used the discounted cash flow formula to calculate the price based on agreed terms and conditions, including a yearly 6% interest, a 10-year repayment period and a 8.25% discount rate to arrive at that figure.

Mani said he used the discounted cash flow formula because payment was being made in the future and for the purpose of issuance of bonds.

He had also said the land's net present value had been certified by his department for 830 acres at RM21psf as at May 11, 2000, based on a cash payment and that if the payment was going to be made over a long period of time, the payments made had to be discounted at 8.25% via the DCF method to reflect the cash price of RM21psf.

Sahari testified that while the cash price was RM21psf, the RM25psf or RM4psf extra included the total interest payable if payment was to be made over 10 or 15 years. The prosecution called 25 witnesses and closed its case on Nov 17 last year. The case has seen various developments.

On Sept 3, 2010, Dr Ling applied to declassify confidential Cabinet papers in relation to his charges for preparation of his defence.

Putrajaya Sessions Court judge Suzana Hussin had on Nov 30, 2010, ordered Dr Ling's cheating case to be transferred to the KL High Court for his trial and any related proceedings.

The latest development was the bid by Dr Ling to recuse the trial judge based on the grounds of apparent bias but Justice Ahmadi dismissed the application on June 21, saying his comments at the end of the prosecution's case would not affect a fair trial.

Dr Ling's lead counsel Wong Kian Kheong said the number of defence witnesses had not been finalised yet.

Sources, however, said former prime minister Tun Dr Mahathir Mohamad would be among the high-profile witnesses to be called to testify under oath in the trial.

Dr Mahathir was interviewed by Dr Ling's lawyers for almost two hours in May to assist in the defence's case.

One of the high-profile witnesses, Minister in the Prime Minister's Department Datuk Seri Nazri Aziz, testified during the prosecution's case last November that the decision to purchase PKFZ in 2002 was a “collective Cabinet decision”.

Nazri agreed to a suggestion by Wong that the Cabinet gave its approval in 2002, although it was informed that the earlier amount of RM1.088bil did not include interests.

Nazri also agreed that among the reasons which caused the Cabinet to expedite the decision over that purchase of land was to make Port Klang the best port for the interest of the country.

It will be interesting to hear evidence from other present and former Cabinet ministers that will surely add spice to this already sensational PKFZ scandal, as the trial of several other personalities and officials, including Dr Ling's successor Tan Sri Chan Kong Choy, are awaiting the disposal of this case.

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Wednesday July 11, 2012

Dr Ling set to take the stand in PKFZ case to clear his name

By M. MAGESWARI mages@thestar.com.my

By M. MAGESWARI
mages@thestar.com.my