Earlier, Bernama news agency reported that MACC conducted inspections and searches at 4 separate locations as part of its investigation involving IJM, which reportedly includes probes into corporate governance, procurement processes, financial transactions and ownership of overseas assets estimated to be worth about RM2.5 billion and how the funds were moved abroad.
The MACC Chief Commissioner reportedly said initial investigations revealed financial records reportedly showing multiple high-value foreign accounts and extraordinary fund movements with unusual cash and transfer reports flagged by monitoring systems, raising serious concerns about corporate integrity and public accountability within one of Malaysia’s largest conglomerates.
As expected, the company in a statement reiterated that the allegations were unfounded but confirmed that 10 of its bank accounts were restricted "to facilitate the process" of ongoing investigations by the MACC and assured their stakeholders that business operations are continuing as usual and the company is committed to upholding strong standards of corporate governance, transparency and integrity and will continue to monitor the development of this matter and will make timely disclosures should there be any material updates.
According to its website, IJM Corporation Berhad claimed it has integrated measures such as Anti-Bribery and Corruption Policy and Whistle Blowing Mechanism to address Section 17A of the Malaysian Anti-Corruption Commission (MACC) Act 2009 into their governance and the Board monitors compliance with these policies to ensure they remain relevant, upholding the company's commitment to anti-corruption regulations.
The Board of Directors (BOD) in every company has a fiduciary duty to act in the best interest of the company, which includes protecting its reputation and assets.
The board's fiduciary duty requires them to ensure the company acts ethically and complies with the law.
When anti-corruption bodies investigate, the board's primary responsibility shifts to ensuring a proper investigation is conducted and cooperating with authorities to resolve allegations efficiently.
Even though MACC has wide ranging and discretionary powers within their framework, they would not have ordered for the freezing of 10 of IJM’s bank accounts without substantiative evidence that something is amiss.
Probably it is in the best interests of the company that instead of focusing on "debunking," the board should focus on identifying and remediating weaknesses, if any, restoring stakeholder confidence and ensuring compliance with laws like Section 17A of the MACC Act 2009.
And concurrently initiate an independent investigation to look into and review the allegations being investigated by MACC presently.
Accordingly, in this aspect, the Board of Directors is reminded that they have a duty of care and avoid supporting a position that could later prove to be false as this can lead to personal liability or regulatory penalties or actions from shareholders.
Directors who fail to uphold their duties, such as by ignoring or covering up corruption, can be held personally liable, facing fines or imprisonment.
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