SPNB sues ex-CEO, contractors for alleged fraud, seeks over RM141m in damages

• SPNB Aspirasi claimed to have been defrauded to ink a development agreement valued at RM108 million in 2015 with a Tunas Manja Development & Construction (KL) Sdn Bhd, which was falsely portrayed to be a subsidiary of TMDC through fake documents which Ahri and Azizi approved.

KUALA LUMPUR (Sept 26): SPNB Aspirasi Sdn Bhd (SPNB Aspirasi), a wholly owned unit of national housing development company Syarikat Perumahan Negara Bhd (SPNB), has brought SPNB’s former CEO Datuk Ahmad Azizi Ali to court, alongside property developer Tunas Manja Development & Construction Sdn Bhd (TMDC) and 10 others on allegations of defrauding the government-owned entity.

The 12 parties were alleged to have conducted a series of conspiracies to defraud SPNB Aspirasi in relation to affordable housing projects involving 469 terrace units in Kuantan, Pahang between 2014 and 2019, according to court documents sighted by The Edge.

SPNB Aspirasi claimed to have been defrauded to ink a development agreement valued at RM108 million in 2015 with a Tunas Manja Development & Construction (KL) Sdn Bhd (TMDC (KL)), which was falsely portrayed to be a subsidiary of TMDC through fake documents which Ahri and Azizi approved.

According to the court documents, SPNB Aspirasi is seeking damages of at least RM141 million in land costs and loss of commercial opportunities, among other reliefs.

Aside from Azizi, TMDC and TMDC (KL), SPNB Aspirasi also named its former CEO Hisham Ahmad as defendant.

Other parties among the 12 are TMDC’s owners Datuk Chin Yoke Choon, Datuk Chin Yoke Kan and Datuk Chin Tham Chui @ Chan Ching Swee; TMDC (KL)’s owners Rusli Ismail and Norhasina Muhammad Hakim, as well as its lawyer Datuk Leong Yeng Kit; and Akitek Akiprima Sdn Bhd and its owner Datuk Cheah Kah Lip.

In the suit, the plaintiff alleged that Azizi and SPNB’s late chairman Datuk Ahri Hashim caused SPNB Aspirasi to enter a lopsided supplementary development agreement with TMDC (KL) in 2019 that contained terms favouring the latter.

Among the terms, TMDC (KL) was entitled to terminate the development agreement in the event of a default by SPNB Aspirasi, and to claim damages equivalent to the entire loss of profits from the project.

Akitek Akiprima — the project’s architecture firm — was said to have appointed four consultants without SPNB Aspirasi’s approval, and later approved false claims from TMDC (KL) against SPNB Aspirasi, which triggered the event of default.

The implication, according to SPNB Aspirasi, was that Azizi and Ahri, through the supplementary agreement, had dishonestly assisted TMDC (KL) to terminate the agreements in order for TMDC (KL) to keep the land's costs of RM33 million, and to submit excessive claims of loss of profits against SPNB Aspirasi.

An arbitration to resolve the dispute between the parties subsequently concluded with SPNB Aspirasi ordered to pay a total of RM26.17 million to TMDC (KL). Prior to that, SPNB Aspirasi had already paid TMDC (KL) RM66.3 million (including the RM33 million land costs), under the 2015 development agreement.

It should be noted that TMDC (KL) filed a winding-up petition against SPNB Aspirasi in May this year following the non-payment of the arbitration award. The petition is scheduled to be heard on Nov 22, according to a report by The Edge weekly.

Meanwhile, according to SPNB Aspirasi's court documents, the allegations came to light after SPNB’s new chairman Datuk Husam Musa, who was appointed on March 22 this year, instructed an internal forensic investigation, which allegedly found that Ahri and Azizi, together with the other defendants, had conspired and acted in concert to defraud SPNB Aspirasi.

SPNB Aspirasi insisted that all the agreements are now “void and invalid ab initio (from the beginning)” and must be set aside by the court, claiming they were “instruments of fraud” used by the defendants to defraud the government-owned entity.

It also claimed that Ahri and Azizi had breached their fiduciary and statutory duties to the company.

It also alleged Hisham of breach of duty, which ultimately affected the company’s interests, saying he had either purposely or carelessly conspired with the defendants and caused SPNB Aspirasi to issue a letter of intent to TMDC for the project.

The writ of summons was filed for the plaintiff by law firm Rajesh, Chew & Ho in the Kuala Lumpur High Court on Sept 24, 2023.

It is understood that SPNB Aspirasi is filing another suit against Azizi, Akitek Akiprima, property developer Wiradani Development Sdn Bhd and three others for allegedly conspiring to defraud the company by similarly making use of false claims and a lopsided supplementary agreement, in a separate housing project.

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