Events leading to my suspension as Kojadi chair

COMMENT | By way of a letter dated July 18, 2019, the board of directors of Koperasi Jayadiri Sdn Bhd (Kojadi) had suspended me as a board member under Article 39(2)(b) of the by-laws of Kojadi.

Under Article 39(2)(b) of the by-laws, a board member may be suspended only when the majority of the board members are satisfied that the board member had acted in a manner which is prejudicial to the interests of Kojadi, according to the Co-operatives Regulations 2010.

I deeply regret the decision of the board members as there is clearly no evidence whatsoever that I had in any way acted in a manner which is prejudicial to the interests of Kojadi. I had served on the board for the last 23 years and had always acted in the best interests of Kojadi.

In order to put the matter in the proper context, I wish to highlight to the public that as early as July 10, 2018 before there was any public controversy over the RM15 million grant from Yayasan 1MDB to Kojadi, it was already discussed and decided in the board meeting that as I had signed the Corporate Integrity Pledge with the MACC on behalf of Kojadi, Kojadi had made a unilateral declaration that it will not commit corrupt acts, will work toward creating a business environment that is free from corruption and will uphold the anti-corruption principles in the conduct of its business and in its interactions with its customers and stakeholders and the government.

As such, the board resolved that:

“Whilst the board is aware that the grant, which was also endorsed and approved by the SKM (Suruhanjaya Koperasi Malaysia), is not to be repaid and that the grant was accepted in good faith from the government, it is a duty of the society to ascertain the current state of the grant which originated from Yayasan 1MDB/1MDB and that it is not related to any of the ongoing investigations related to 1MDB. To this end, the board resolved that:

• The chairperson and/or exco members and the senior management of the society to inform and declare to the relevant authorities, eg MACC on the grant received from the government via Yayasan 1MDB,
• The society will provide its full cooperation to the authorities on the Grant.”

Subsequently, during the board meeting dated June 27, 2019 (“the said board meeting”), it had been brought to the attention of the board members that the finance minister had announced that those who received money from the 1MDB Foundation, 1MDB or 1MDB charity club are to return the money and not to wait for the MACC to freeze their accounts.

During the said board meeting, there was a lengthy deliberation on the matter and the board was of the opinion that the status and the situation of the grant should be ascertained by seeking the advice of the MACC or relevant authorities, and to forestall the listing of Kojadi in the MACC list which may result to the society’s accounts being frozen. The board deliberated at great length and resolved:

1. To authorise the chairperson to follow up with MACC/relevant authorities on the status of the grant via a letter.
2. To authorise chairperson to discuss with the relevant authorities, if required on the 1MDB grant.
3. To surrender the 1MDB grant, if required, subject to the agreement on the terms with the MACC or relevant authorities, eg amount, timeframe, mechanism etc.
4. To seek legal opinion on the matter.
5. To brief and consult MCA President on the matter.

Due to the urgency and gravity of the matter, I had to meet with MACC immediately to discuss the matter and get the MACC’s advice in order to forestall the listing of Kojadi in the MACC list which may result in the society’s accounts being frozen. The mandate had been given to me by the board to discuss the matter with MACC and to ascertain the status of the RM15 million grant, both by way of discussion and letter.

After the said board meeting, I had also called MCA president Wee Ka Siong (above) on June 27, 2019 to brief him on the matter. However, he had interfered in the matter by giving a firm “party instruction” that I am not to attend any meeting or interview with MACC until a meeting with MCA leaders the following week. He sent a message to all the board members as follows:

“In short, don’t attend any meeting/interview with MACC until we meet up next week. Otherwise, it will be construed as defying the party instruction of an attempt to make Kojadi an independent entity and has no connection whatsoever with MCA. No way! Hope all Kojadi directors will put Kojadi and MCA interest above all!”

I then decided to quit MCA as a sign of protest.

Kojadi is an autonomous entity

As a co-operative, Kojadi is an autonomous entity and should act independently. My duty as the chairperson is to primarily protect the interests of Kojadi and that of the 60,000 members and also the 60 staff. I have been elected by the delegates at the annual general meeting and I have to answer to the members of Kojadi and not to the MCA president. 

Also, my obligation as mandated by the board to co-operate with the authorities takes precedence over following the instructions of the MCA president with blind loyalty.

From Wee’s subsequent press statements on this matter, it is clear that he is taking the position that the RM15 million grant from Yayasan 1MDB is legal and should not be returned. As such, it appears that the MCA president is now the new spokesperson for Kojadi and had usurped my role as the chairperson.

If this state of affairs is allowed to continue, it will bring Kojadi on a collision course with the authorities on the issue of the RM15 million grant and lead to serious consequences such as freezing of accounts and disruption in the business operations of Kojadi. These are the things that will jeopardise the interests of Kojadi and cause irreparable harm and damage to Kojadi which I was trying to prevent as the chairperson.

My disagreement with the MCA president on the issue of my co-operating with the authorities on the RM15 million grant cannot by any stretch of imagination be construed as being detrimental to Kojadi.

Doing the right thing and co-operating with the authorities to ensure that Kojadi steers clear of criminal and civil sanctions was an act to protect and not jeopardise the interests of Kojadi.

Furthermore, my action of co-operating with the authorities on the RM15 million grant is clearly within the mandate given by the board both on July 10, 2018 and June 27, 2019. The board should be supporting me for carrying out the mandate given by the board without any fear or favour.

Regrettably, in carrying out the mandate given by the board, I had now been suspended by the very same board which gave me the said mandate.

Wee in his press statement dated July 13, 2019 had said that at the said board meeting dated June 27, 2019, the board had merely decided to follow up with MACC by way of a letter and not to surrender the money to MACC on June 28, 2019.

As such, he concluded that I had lied and acted in contravention of the board decision. I wish to emphatically state that I had never informed Wee that I wanted to surrender the money to MACC on June 28, 2019.

What I wanted to do was to meet with MACC to clarify Kojadi’s position and to seek MACC’s direction and guidance as mandated by the board. 

His allegation that I had lied is a baseless allegation, calculated with a pernicious motive to tarnish my reputation.

As such, I fully reserve my rights to commence legal action against him for defaming my character and reputation.

NG PENG HAY is the Koperasi Jayadiri Sdn Bhd (Kojadi) chairperson (suspended)

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