KUALA LUMPUR: Malaysia’s former deputy prime minister Ahmad Zahid Hamidi was slapped with 45 charges in court on Friday (Oct 19) in a RM114 million (US$27.4 million) case, a new blow to his beleaguered party which lost power in landmark elections this year.
Key accusations include that he misappropriated money from a charitable foundation he headed, received kickbacks in exchange for awarding government contracts, and laundered money by buying property.
"I am ready to face all these charges thrown at me," Ahmad Zahid told reporters. "It is a test from Allah."
He also told reporters that he would explain the charges against him in court when the time came.
“This is not the place for me to give any explanation, but in court later,” he said as he was leaving the court.
In all, the charges include 10 counts of criminal breach of trust and abuse of power as well as eight counts of corruption involving RM42 million. These charges are linked to funds from Yayasan Akal Budi, a welfare foundation that he chairs, and MyEG, which provides e-government services for various agencies.
Ahmad Zahid was also charged with 27 counts of receiving and transferring illicit money under anti-money laundering laws. These charges involved a total of RM72 million, according to Bernama news agency.
Each of the 45 charges carries a jail term of up to 20 years, with fines of up to five times the value of the illegal transactions for the money laundering and abuse of power offences.
The 65-year-old pleaded not guilty to all charges, and will stand trial.
He was allowed to be released on RM2 million bail. The court ordered him to pay RM1 million of his bail on Friday and settle the remaining sum by Oct 26. His case will be mentioned again on Dec 14.
Ahmad Zahid was also ordered to surrender his passport.
ALLEGED KICKBACKS FOR GOVERNMENT CONTRACTS
Ahmad Zahid, also a former home minister, was accused of using his position to receive bribes in exchange for helping companies win contracts for ministry projects.
In one case, he was alleged to have accepted RM6 million from Chew Ben Ben, director of Datasonic Group, which had secured a five-year government contract to supply 12.5 million electronic chips for Malaysian passports.
In another, prosecutors said Ahmad Zahid received RM13.25 million, allegedly to help a company secure projects awarded by MyEG.
Shares of Datasonic slumped as much as 43 per cent on the Malaysian stock exchange before paring some losses to trade down 28 per cent.
Datasonic said neither the company nor any company official made a payment to Ahmad Zahidi.
In a filing to Bursa Malaysia, Datasonic said it won the contract to supply the passport chips through an open tender in April 2012.
It was awarded the contract based on the value proposition of enhanced chip security and 15 per cent lower pricing as compared to the previous vendor. This, it said, saved the Malaysian government RM56.25 million over five years.
“We wish to clarify that neither the company nor any of its directors has issued any payment to Datuk Seri Dr Ahmad Zahid Hamidi in relation to the supply of 12.5 million chips for the Malaysian passport,” it added.
MyEG said the company had never made any payments to any party to secure contracts.
"MY BROTHER IS INNOCENT"
A crowd of supporters turned up outside the court, waving banners that read "we reject the cruel treatment of our leader". Several supporters also attempted to force themselves through the main gate of the court complex but were held back by policemen.
Former prime minister Najib Razak was also in the courtroom during the hearing. He told reporters he was there to give "moral support" to Ahmad Zahid.
Ahmad Zahid leads the opposition as the president of UMNO, which had ruled Malaysia for 60 years before being ousted in a shock general election defeat in May.
UMNO has been on the ropes since, with many coalition partners abandoning a party that had become synonymous with widespread graft, divisive racial politics in the multi-ethnic country and a rotten ruling elite.
UMNO insists the case against their leader is politically motivated and his brother, Mohamad Lokman Hamidi, said Friday was a "black day" for Malaysia.
"My brother is innocent," he told reporters.
UMNO deputy president Mohd Hasan said the party will convene an emergency meeting to decide on the status of Ahmad Zahid as president. Mohd Hasan also urged the party's rank and file members to stay calm in the meantime.
UMNO is a party that respects rule of law, he said.
Ahmad Zahid was brought to the court complex at 8.15am on Friday from the headquarters of the Malaysian Anti-Corruption Commission (MACC) in Putrajaya.
He had looked calm as he walked into the building, and smiled and waved to reporters and members of the public.
Ahmad Zahid, who was accompanied by his wife Hamidah Khamis and their daughter Nurulhidayah Ahmad Zahid, left at 1.15 pm in a Toyota Land Cruiser.
Ahmad Zahid was arrested at 3.15pm on Thursday at the MACC headquarters, where he was giving a statement in the investigation into the misappropriation of funds at the foundation.
The anti-graft agency said in a statement following his arrest that he would be charged under the Malaysian Anti-Corruption Commission Act and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act.
Local media have said that he is believed to have abused about RM800,000 of the foundation’s funds to settle his and his wife’s credit card bills.
He has denied wrongdoing, saying the payments were made in error by an aide and that he has since repaid the amount.
Additional reporting by Melissa Goh.