Sports Ministry mum over chances of recovering RM4 mil

PETALING JAYA: Funds totalling RM4 million belonging to the Malaysian Paralympic Council (MPC) are as good as gone with little likelihood that its "investments" can be recouped.
Despite its president Datuk Zainal Abidin Abu Zarin being relieved of his duties, it is unlikely that any monies can be recovered. A motion to suspend him was passed at the council's annual meeting two weeks ago.
theSun had two years ago reported that the council wrote off the amount invested through Paralimpik Ventures Sdn Bhd (PVSB), a company owned by Zainal Abidin and his family members.
MPC, the nation's governing sports body for the disabled, is a non-profit organisation aimed at promoting sports among the disabled for them to maintain a healthy and active lifestyle.
Its main sources of funds to carry out activities are government grants, sponsorship and donations.
Records with the Companies Commission of Malaysia showed that PVSB, which was registered in 1999, is helmed by Zainal Abidin, who is listed as its director and 80% share holder. Other directors are one Muhamad Wahbullah Abu Zarin, Zainal Abidin's two sons, Idi Irwan and Ilia Ikhwan, and MPC secretary-general Kassim Abd Rahman, who is listed as holding 10% of the shares, and Idi the remaining 10%.
Due to what was described as "irrecoverability" of the investment, the sum was wiped off MPC's accounts.
However, a three-man steering committee, which was appointed to investigate the missing funds, concluded otherwise stating it should remain in the books as a "bad debt".
The committee made the following findings:
» In 2008, PSVB had recommended to the Council's exco to invest in a capital-guaranteed fund;
» PVSB was a special purpose vehicle set up by the council with Zainal and the then secretary Kassim Abdul Rahman as directors. This was to ensure funds will be managed in accordance with the council's mandate;
» After RM4 million was transferred to PVSB's accounts, the company, without the consent of the council, invested the money with a commercial bank's wealth advisers in a non-capital guaranteed fund;
» This caused a loss of more than a third of its investment – RM1.6 million, after which the balance was cashed out in a Florida-based company – All4Ones LLC;
» PVSB informed the council that it was unable to contact the consultant who arranged for the investment or able to communicate with All4Ones to determine the status of the RM2.4 million as the company did not execute any contract with the Florida company;
» PVSB subsequently told the council that it had contacted All4Ones and had executed a contract. However, the contract was between All4Ones and ParaGroup Sdn Bhd, another company in which Zainal is a director.
The committee noted that PVSB was unable to give an explanation as to why a police report was not lodged when it was unable to communicate with the consultant, the fund manager and All4Ones.
It also recommended that the sum not be written off in view of the discrepancies and it be re-instated as a bad debt in the council's accounts.
It also recommended that a police report be lodged and this was done by MPC's secretary, Siti Zaharah Abdul Khalid on May 23.
While the sum is massive, the sports commissioner and the Sports Ministry have kept mum over the matter but the former deputy sports minister Datuk Gan Peng Siew is on record as saying that "it is shameful because (how can) a body suddenly lose RM3.8 million?"
"It's a substantial amount and even more so when it involves disabled athletes. From reports, there is no clear explanation how the cheques were issued and how the money was used. This gives rise to a lot of questions which is unhealthy for the sport," he was reported as saying.