The Malaysian Insight

THERE are clear signs of fraud in Felda’s Jalan Semarak land deal, said a top property lawyer, as investigations intensify into how the beleaguered agency lost ownership of a prime piece of land in the heart of Kuala Lumpur.

Malaysian property lawyers (HartaGuam) deputy president Salkukhairi Abd Shukor said this was because the developer of the four parcels of land had abused the power of attorney granted to it by Felda.

The developer, appointed by Felda subsidiary Felda Investment Corporation (FIC), transferred ownership of the land to Synergy Promenade Sdn Bhd in which it had an interest.

The transfer of ownership did not have to occur as the developer had only been appointed by Felda to build Kuala Lumpur Vertical City (KLVC), said Salkukhairi.

KLVC is being built on land that houses Felda’s old headquarters and two of its buildings, Anjung Felda and Wisma Felda. Once completed, the project is supposed to include the agency’s iconic tower, known as KLVC Tower1A.

Another sign of fraud was the claim that no money changed hands during the alleged transfer, he said.

“According to Felda chairman (Shahrir Samad), Felda has up to this point not received a sen from the transfer.

“How could a land owner transfer ownership without any value consideration? That’s where I believe the fraud is,” Salkukhairi told The Malaysian Insight.

It has been reported that the land, which totals 66,000 sq m in central Kuala Lumpur, was worth RM270 million when its ownership was transferred.  

However, Shahrir reportedly said Felda did not gain a sen from the transaction which occurred in December 2015.

The decision to appoint KLVC’s developer and to give it power of attorney was done by FIC in June 2014.

However, FIC only informed the Felda board of the decision three months later and asked for retrospective approval.   

Police have opened investigations into the allegations and plan to haul up former Felda chairman Mohd Isa Samad for questioning.

Isa was both Felda and FIC chairman while the deal took place.   

To reclaim its property, Salkukhairi said, Felda would have to file a civil suit and get a court declaration that the transfer was illegal.

“Once that is done, the court can order the Land Office to cancel the current ownership and return the land to Felda.”

Previously, legal expert Prof Salleh Buang said the National Land Code 1965 allowed for parties to contest the status of a property’s ownership if there were elements of impropriety in its transfer.

Salleh said this must be done before the land is sold off to a third party, who can be classified as a bona fide purchaser (BFP). If that happens, Felda can no longer challenge and reclaim the land.

Shahrir, the Felda chairman, said caveats have been put on all four parcels to prevent them from being resold or transferred again.

The case of Adorna Properties Sdn Bhd vs Boonsom Boonyanit set a precedent for those who had lost ownership of their land through fraud, Salkukhairi said.

In that case, Boonsom, who had been living in Thailand, lost ownership of two parcels of land in Tanjung Bungah due to a fraudulent transaction involving an imposter in 1989.

After a series of court battles between Boonsom’s family and Adorna, the Federal Court ruled in 2004 in favour of Adorna – the company which obtained ownership of the land through the imposter.

But in 2010, the same court ruled that the 2004 decision was “erroneous, unjust and a breach of Malaysia’s obligations” under the Asean treaty.

In the Felda case, Synergy Promenade is not considered a “deferred purchaser” where it can be protected like a bona fide purchaser, said Salkukhairi.

“Going by the Federal Court’s decision in the Adorna case, Felda’s rights as the owner will be protected as current laws give more rights to original owners who have been cheated,” said Salkukhairi. – December 28, 2017.