MACC’s first arrest

Pristine Offshore Sdn Bhd has become the first company to be charged with the newly introduced provision, which imposes corporate liability under the Malaysian Anti-Corruption Commission (MACC) Act 2009. The Malaysian Anti-Corruption Commission (MACC) makes its first arrest ever with the offshore vessel support company and its former director Chew Ben Ben being charged today (March 2021) under Section 17A of the MACC Act 2009 with one count of bribery involving RM321,350 to ensure that it was awarded a subcontract from Petronas Carigali Sdn Bhd and one count of bribery, framed under Section 16(b)(A) of the MACC Act 2009. 

First company charged under Malaysia’s new corporate liability anti-corruption law

“The incident took place between June 29 and Oct 14 last year,” the MACC said. The bribe was allegedly given to Mazrin Ramli, the chief operating officer (COO) of Deleum Primera Sdn Bhd, to ensure Pristine Offshore was awarded the subcontract from Petronas Carigali. Currently, Mazrin is one of the senior executives of Deleum Primera, a 60%-owned unit of public-listed company Deleum Bhd, who are currently facing an RM19.88 million civil suit over an alleged scheme to defraud the company. 

With the introduction of the amendment, which came into effect on June 1 last year, the MACC can now directly impose corporate liability on commercial organisations, including public and private limited companies whose employees or associated persons are involved in corrupt practices dishonest commercial misconduct. 

Deleum Primera filed the suit against four of its senior executives, as well as against two Petronas Carigali tender evaluation committee members and three of its subcontractor companies for the purported breach of fiduciary duty. Meanwhile, in this case, the subcontract that was promised to Pristine Offshore was for the provision of workboat, master and crew and other associated marine services and offshore support related to the workboat, together with other marine support spread for maintenance, construction and modification services for Petronas Carigali. 

The offence was allegedly committed between Jun 29 and Oct 14 last year in Kinrara Niaga 3, Puchong. Both of the accused pleaded not guilty after the charges were read out to them before Sessions Court Judge Rozilah Salleh. Pristine Offshore’s current director Datuk Abdul Kamal Mohd Mydeen, showed up on behalf of the company today.

If convicted, the offshore vessel support company faces a fine of over 10 times the bribe’s amount or a maximum jail sentence of 20 years. According to the Companies Act 2016, any company officers, including directors and the company secretary, are liable to serve the prison sentence on behalf of the company.  As for Chew, if found guilty, he may be imprisoned for up to 20 years and fined up to five times the bribe amount.

Currently, Judge Rozilah set bail at RM150,000 for Chew and RM200,000 for Pristine Offshore with one surety. Chew also had to surrender his passport to the court. Both of the accused were represented by Bernard Francis & Associates, while the prosecution was led by Deputy Public Prosecutor (DPP) Ahmad Akram Gharib.

It is worth noting that Chew is also the deputy managing director of Datasonic Group Bhd and one of the witnesses in the ongoing corruption trial of former deputy prime minister Datuk Seri Dr Ahmad Zahid Hamidi. Chew was brought into the trial as a prosecution witness to testify an alleged RM6 million bribe that Datasonic gave to Zahid in 2017. Chew claimed the payment was a political donation meant for the Barisan Nasional (BN) coalition to be used in the 2018 general election (GE14).

Section 17A of the MACC Act 2018

Section 17A of the MACC Act 2018 will enable the prosecution of individuals accused of corruption, not only organisations. Under the provisions, any organisation’s “directors, controllers, officers, partners, or managers are deemed to have committed the same offence. This carries a maximum penalty of a fine of not less than 10 times the value of the gratification or RM1 million, whichever is higher, and 20 years’ jail unless the firm can prove that it had in place procedures designed to prevent corrupt practices. 

The provision is modelled after the United Kingdom’s Section 7 of the Bribery Act 2010, which is widely regarded as ‘the toughest anti-corruption legislation in the world'” (New Straits Times, 2019). Perhaps it’s no coincidence that Malaysia improved by six points and jumped 10 places to 51 in Transparency International’s 2019 Corruption Perceptions Index (CPI). The CPI “measures public sector corruption, including bribery, diversion of public funds, public office use for private gain, and nepotism in the civil service” (Free Malaysia Today, 2020). The change in law and perception meets popular demand in Malaysia, with too many bribery and corruption cases happening. 

MACC Act’s provisions are meant to encourage business and commercial activities to be carried out in a corruption-free environment; to encourage all commercial organisations to take adequate measures to prevent corruption in their respective organisations, and to promote better corporate governance and legal compliance by requiring corporations to take proactive roles in preventing corruption.

Demonstrating “adequate procedures” with ISO 37001 certification

Now more than ever, it is critical that organisations undergo a program of compliance and demonstrate “adequate procedures” with ISO 37001:2016 Anti-Bribery Management standard certification. ISO 37001 is established, tried and tested program that provides a comprehensive program for preventing bribery and corruption. It can be tailored to organisations of all sizes and industries, and certification requires the demonstration that processes have been implemented effectively – with follow-up evaluations. The new corporate liability provisions to the MACC Act are important for safeguarding Malaysia’s economy and investments.

It is crucial to trust your anti-bribery and compliance strategies to accredited ISO 37001 certification providers. ABAC®-Malaysia has recently announced that the United Kingdom Accreditation Service (UKAS) has accredited its ABAC Certification services for administering the ISO 37001:2016 Anti-Bribery Management Systems standard. ABAC®-Malaysia provides ISO 37001:2016 anti-bribery management systems certification for all types of organisations across the globe that implement prescribed measures to prevent, detect and address bribery. Under this, UKAS accredited ABAC® in the UK, Malaysia and UAE for ISO 37001:2016 Anti-Bribery Management Systems (ABMS) certification under ISO/IEC 17021-1: 2015 conformity assessment requirements for bodies providing audit and certification of management systems.

Trust ABAC®-Malaysia, your accredited certification provider in Malaysia, to comply with requirements of Section 17A of the Malaysian Anti-Corruption Commission Act (MACCA 2018) with confidence. To learn more about how the ABAC®-Malaysia can help tailor an ISO 37001 certification program to your organisation, contact ABAC®-Malaysia today.

Prove That Your Business is Ethical

Complete our FREE Highest Ethical Business Assessment (HEBA) & evaluate your current Corporate Compliance Program. Find out if your organisation’s compliance program is in line with worldwide Compliance, Business Ethics, Anti-Bribery and Anti-Corruption Frameworks. Let ABAC®-Malaysia experts prepare a complimentary gap analysis of your compliance program to evaluate if it meets “adequate procedures” requirements under the UK Bribery Act, DOJ’s Evaluation of Corporate Compliance Programs Guidance and Malaysian Anti-Corruption Commission.