Mida D-G in RM5.5 million fraud?

By Free Malaysia Today

BANGI: The Malaysian Industrial Development Authority (Mida) office in Jalan Duta is buzzing with allegations of fraud over a RM5.5 million public relations contract awarded, without tender, to an advertising company. Alleging power abuse and acts of swindling, several officers claimed that Mida director-general Jalilah Baba was well aware of the goings-on in the organisation and was in fact involved in the case.

A report in Harakahdaily quoted several unnamed officers who alleged the fraudulent activities involved a company called Friends Advertising Sdn Bhd (FASB) which was appointed to handle Mida’s public relations activities in Malaysia and abroad.

According to a document dated June 17, 2009, Mida not only appointed FASB via direct negotiation, but it also offered the company other lucrative jobs, which were outside its scope of work.

Among the jobs given to FASB were publishing and printing Mida materials, preparing exhibition panels and promotional collaterals such as buntings, greeting cards and corporate brochures.

“All these were contracts awarded without open tenders. There is only one company now handling the entire job,” said an officer involved in the selection process.

“Changes have taken place here since Jalilah took over the technical and pricing committee. We’ve cancelled the tender process to enable her to directly appoint the company,” said another officer.

Citing an example, he said, Mida had appointed FASB for the “Rebranding of Mida & Malaysia” job (under its media plan 2010) for RM15,000 a month.

Going against procedures

The officer said according to a notice dated Dec 28, 2009, Jalilah had approved a FASB proposal worth RM5.5 million without a tender process.

“This is against government and Mida’s finance procedures. It is clearly stated in our guidelines for government procurements that the director-general’s authority to approve projects without tender is limited to RM50,000.

“In this case, the director-general had approved RM5.5 million.  

“This has given FASB the upper hand. Riding on its special status, it has now doubled the cost price of the projects at its whims and fancies. For instance, FASB charges RM15,000 for designing an advertisement when the market price is between RM1,200 and RM2,500.