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THE Malaysian Anti-Corruption Commission has recommended a series of governance reforms for two state agencies caught in the widening Sabah mining scandal, after an audit found weaknesses in how exploration licences were processed.
The MACC Governance Division said it had identified five areas of concern involving the Sabah Lands and Surveys Department (JTU) and Sabah Mineral Management Sdn Bhd (SMM), the two agencies directly responsible for issuing Prospecting Licences (PL) in the state.
The audit, carried out by MACC’s Governance Investigation Division (BPT), revealed that both agencies lacked clear and comprehensive standard operating procedures (SOPs), resulting in overlapping functions and inconsistent requirements for applicants.
“Among the weaknesses identified were the absence of a complete and detailed SOP for the PL application process, as well as the requirement for applicants to submit a Letter of Interest either to SMM or the Chief Minister’s Office,” the MACC said in a statement.
The review also found that certain applications that did not meet the required due diligence standards were still brought before SMM’s Board of Directors — chaired by the Chief Minister, and that no specific SOP existed for renewal or extension of PLs.
To address these governance gaps, the MACC proposed five reforms:
1. Draft and document clear SOPs for the PL application process;
2. Amend existing procedures to ensure all Letters of Interest are submitted directly to SMM;
3. Update due diligence protocols to guide follow-up actions;
4. Introduce specific SOPs for licence renewals; and
5. Develop an online portal detailing SMM’s functions and application procedures.
“The purpose of these recommendations,” the statement added, “is to strengthen transparency, accountability, and consistency in how prospecting licences are processed.”
MACC said both JTU and SMM had accepted its findings and “expressed appreciation for the sharing of results and improvement proposals presented by MACC.”
During a presentation at Wisma Tanah dan Ukur in Kota Kinabalu on Thursday, both agencies signed a Governance Improvement Report witnessed by MACC Deputy Director Ahmad Shukri Mohamad Taib.
Also present were JTU Director Datuk Sr Bernard Liew Chiu Min, SMM Chief Executive Officer Natasha Sim Nuo, and Integrity Advisor to the Chief Minister Awang Samsul Baharam Bungso, along with senior officers from both agencies.
The MACC said it expected the two agencies to act on the recommendations to prevent future abuse and ensure that all mineral resource decisions are handled “in the best interest of the people of Sabah.”
The audit is the latest development in Sabah’s mining controversy, which has prompted renewed scrutiny of how the state manages its mineral resources. – October 24, 2025.