Kota Kinabalu: Former Water Department Director Ag Mohd Tahir Mohd Talib was behind a centralised collection system where “contributions” were collected from successful bidding contractors, former Deputy Director Teo Chee Kong revealed to the Special Corruption Court, Wednesday.
Teo, the prosecution’s 29th witness, reading out his witness statement during examination-in-chief before Judge Abu Bakar Manat, said the so-called “collection system” had been going on since 1989 but that as a new officer in the department, he was merely following the practice of his predecessors.
He was testifying in the trial of Ag Mohd Tahir Mohd Talib, 58 his wife, Fauziah Piut, 55 who are jointly tried with Lim Lam Beng, of 66 to 37 counts of money laundering charges, involving cash and bank savings amounting to RM61.57 million, as well as unlawful possession of luxury goods.
Teo leaving the courthouse accompanied by his counsel.
Teo began as the Keningau District Works Engineer in 1989 and was promoted to deputy director on February 2015 but was also Kota Kinabalu Divisional Water Engineer.
He said that from 1998 until September 2003, he had been collecting money from companies that were willing to contribute and handed the collections to the Director (five per cent), Quantity Surveyor (three per cent), Chief Water Engineer, an accountant (one per cent).
He said he had been handing the money to the director (since deceased) up to August 2003. In August 2003 when the director was about to retire, a proxy of Mohd Tahir (who was deputy then), Teo named as one Michael Wong, met him asking that RM500,000 be given to a Minister because he (Mohd Tahir) was lobbying to become the director.
“Mohd Tahir was promoted in September 2003,” he said. He met Mohd Tahir and Wong at the department headquarters where he handed the RM500,000 to Awang Tahir witnessed by Wong.
Earlier, the court allowed Lim’s counsel’s objection regarding the names of the people in Teo’s witness statement and allowed the witness statement to be accepted but that the names not be mentioned, only the position of the nominee along with the percentage distribution.
Teo said among his responsibilities as deputy director was to chair the tender committee for the Kota Kinabalu division and look for contractors willing to give commission or contribution to the Division Water Engineer (JAB) and District Water Engineers once they have acquired projects.
He named some of the friendly contractors as Wong, Datuk Tony Teo and Mickey Yih.
“I’ve told them that if they were interested to join the scheme they need to make a contribution of 10.75 per cent from the project’s quoted price and similarly for future projects.”
Contractors who failed or refused to pay after getting the project would be blacklisted and not invited to bid for future projects.
Information relating to the projects would be relayed by Teo’s officers, Liaw Wee Ming, to the contractors concerned and they would, in turn, bid lower than the quoted price and get the jobs pre-arranged.
The project cost is based on the Schedule Rate, which is the price guideline or standard price issued for contractors and the department when dealing with each other.
“The fact is the Schedule Rate is actually an inflated rate whereby the price has been manipulated with an additional cost of between 100 to 150 per cent in order for the contractors to recover the commission paid (contribution),” he said.
The standard price was prepared by technicians (Liaw Wee Ming and Yih Kian Kok) who were under his supervision and upon passing the audit query, Mohd Tahir instructed him (Teo) to prepare the standard price for pipe and fitting, maintenance pipe and pipe relating works.
Teo confirmed that as chairman of the divisional water engineers, he had tabled the standard price also known as the Schedule Rate that would be used by all divisions.
The Schedule Rate was approved by the top management on April 2005 chaired by Mohd Tahir.
On how did the formula of the commission distribution come about, Teo said he got a call from the deputy director, Lim Lam Beng (LLB) sometime in the fourth quarter of 2004, asking him to come to his (LLB) office where LLB confided to Teo that Mohd Tahir and he had discussed the collection of commission from contractors.
During their meeting, Teo said LLB informed him Mohd Tahir did not agree with the percentage of the collection that was done by the respective Divisional Water Engineer.
“Awang Tahir was not satisfied with the total collection and percentage collected by the nine engineers at the Division Water Department.
“The payment was also non-periodical. Awang Tahir also did not like to meet with the nine engineers whether at his office or home to receive the money,” he said.
That was why Mohd Tahir suggested a centralised collection system and Teo was also told by LLB that Mohd Tahir wanted Teo to act as the “runner” to collect the contribution from the nine division engineers.
During the meeting, Teo said LLB also informed him about the formula of distribution and people that needed to be paid, namely officers at the Infrastructure Development Ministry including the Minister, Permanent Secretary, Permanent Deputy Secretary and staff while at the Ministry of Finance, the recipients were the Permanent Secretary, Deputy Permanent Secretary as the one looking after expenditure.
LLB told Teo that the payment was necessary for the interest of the department.
Teo was told by LLB that the distribution percentage totaling 10.75 per cent had been agreed upon by Mohd Tahir after a discussion between them.
LLB told Teo that the 10.75 per cent collection was proposed by Mohd Tahir himself.
The formula to distribute the payment as commission from all successful contractors was as follows:
@ Water Department Director - 2.4 per cent
@ Deputy Water Department Director - 1.5 per cent
@ Quantity Surveyor HQ - 1.5 per cent
@ Water Engineer Chief Operation and Maintenance - 1.5 per cent
@ JANS Head of Finance - 0.7 per cent
@ JANS Account Section - 0.4 per cent
@ District Engineers pool money (under Teo’s purview) - 0.25 per cent
@ State Finance Ministry - 1 per cent
@ State Infrastructure Development Ministry - 1.5 per cent
“The idea to hold this ‘centralised collection’ formula came from Awang Tahir, I was informed by LLB that this was an instruction Awang Tahir had made to him,” said Teo.
After meeting with LLB, Teo went back to his office and drew up the table using Microsoft Excel on his computer, which he handed to LLB when they met up a few days later.
On that same day, LLB took Teo to see Mohd Tahir where he showed him the table of distribution percentage of the commissions.
LLB explained to Mohd Tahir about the table and that the distribution table included the Minister of Infrastructure Development and Permanent Secretary as well as officers to build up a rapport, said Teo.
Teo said LLB told Mohd Tahir that the Minister at that time was Datuk Raymond Tan “who must be taken care to facilitate all dealings involving the Water Department, which is under the purview of the Infrastructure Development Ministry.”
LLB also informed Mohd Tahir that both LLB and Teo would be making a courtesy call on the Minister concerned to notify him about the contribution from the department.
Mohd Tahir agreed, said Teo.
“The Minister did not know about this scheme and did not know the source of the funds. The Minister also never asks about it,” said Teo.
LLB also explained to Mohd Tahir that an “allocation” of one per cent was also necessary for an officer in the Ministry of Finance who can help in facilitating JANS (Dept) budget, said Teo.
After listening to the explanations on those in the list of the distribution percentage, Teo said Mohd Tahir only responded “ok bah, I have no problem.”
Teo recalled LLB as saying “since the boss already agreed we can proceed with this table” in front of Mohd Tahir.
Teo said he was told by LLB to inform all the District Engineers about the collection and that they should call him (LLB) if they wish to verify it to which Teo agreed.
At the end of their discussion, Teo said he told Mohd Tahir that “saya ikut boss punya cakaplah” (I will just follow what you say, boss).
“Awang Tahir only nodded and said okay we go ahead with this proposal,” said Teo.
Teo recalled that in the second quarter of 2005, Lim brought him to see Datuk Raymond Tan, namely Sabah Infrastructure Development minister, to inform that there will be monetary contribution for him in which Lim informed that there will be contribution from the Sabah Water Department, “Datuk we have agreed to allocate something for you, when collected from quotation works in Jabatan Air Negeri Sabah”.
Teo said Lim informed Raymond that either Lim or him will send the money whenever there is a collection.
Lim also stated that the monetary contribution was to help his (Raymond) party.
YB Raymond Tan said “Thank You, very good and thanked us, said Teo, adding that Lim informed Ag Mohd Tahir about the matter before meeting the Minister and that after meeting with the Minister there would be allocation for the Ministry.
“The meeting was only about 30 minutes. I confirm that YB Raymond did not feel surprised or panicked and did not ask the source of the financial source or how we obtained the money,” said Teo, adding that there were no other officials in Raymond’s room during their discussion.
Teo also recalled in September 2005, he prepared about RM500,000 to be handed over to YB Raymond and said that he prepared the money from the collection of companies involved in quotations and that Lim and he went to Raymond’s office to hand over the money kept inside a black bag.
Teo confirmed that Lim handed over the money and informed Raymond that after the contribution, he (Teo) would hand over allocation money to him when there are more allocation in which Raymond did not ask more and did not want to know the source.
Teo also confirmed the monetary contribution to Raymond was told to Awang Tahir and it was within his knowledge.
On why Mohd Tahir wanted Teo to be the “runner”, Teo said Mohd Tahir did not state his reason.
“I think perhaps I can be trusted and the collection from the Kota Kinabalu division often involved a large sum,” he said.
Apart from acting as a runner, Teo said he also met with the contractors so that the collection system would not incur them any loss.
Teo said Mohd Tahir’s instruction for all the divisional engineers and district engineers to adhere to the centralised collection system was relayed during the divisional engineers/district action meeting chaired by Teo on April 6, 2005.
The meeting notification letter was signed by Mohd Tahir, which also stated that it would be chaired by Teo in his capacity as the Kota Kinabalu divisional engineer.
During the meeting, all nine divisional engineers and district engineers agreed on the table that would be implemented.
He said those in attendance at the meeting were himself, (Kota Kinabalu), Chong Kek Fui (Sandakan), Mohd Azri Abdullah (Keningau), Petrus Augustine (Tawau), Chin Yun Shoing (Lahad Datu), Suhaimi Asbullah (Beaufort), late Choo Kim Chu (Kudat), Tham Yin Foon (Kota Belud) and Anthony Jullah (Ranau).
All nine did not object and agreed unanimously and also did not voice any dissatisfaction, said Teo, adding that there was no other staff in order to maintain confidentiality.
The centralised collection system was not minuted because it was not official and confidential, said Teo.
Lim’s counsel Tan, also put on record his objection to several pages of Teo’s witness statement in relation to his client on the grounds, among others, that it was hearsay.
The prosecution replied that they will submit on the matter at the end of the prosecution’s stage.
The judge took note of the objection and held that the court will deal with it later and will hear submissions from parties in relation to the objections raised.
Deputy Public Prosecutors Mahadi Abdul Jumaat, Haresh Prakash Somiah and Zander Lim appeared for the prosecution.
Ag Mohd Tahir and Fauziah were represented by counsel Priskila Akwila Sinem.
Together with Tan in representing Lim were counsel Baldev Singh, Karpaljit Singh and Aaron Lau.
Counsel Ram Singh held a watching brief for Teo. Trial continues.
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