MARA Inc’s purchase of a shell company would never have been approved by the board, said its chairman Mohammad Lan Allani, MalaysiaKini reports.

Lan was responding to allegations that the subsidiary of Mara, the agency tasked with helping poor, rural Malays, had entered into a deal in 2012 to buy US$2 shell company Thrushcross Land Holdings Ltd, which claimed to own the 12-storey UniLodge building in Melbourne, when it didn’t.

Thrushcross, incorporated in the British Virgin Islands, was sold for A$41.8 million to Mara Inc by another BVI-registered firm, Scarlett Nominees Ltd.

At the time of the purchase, Thrushcross Land did not own any assets, and only acquired the Melbourne property five months after it was bought by Mara Inc.

Lan said he could not remember the details of the transaction but as chairman of Mara Inc, he was required to sign all documents.

“What I can say is if the company (Thrushcross) is a shell company, there is no way Mara Inc board would approve the deal. Our SOP (standard operating procedure) is very thorough.

“While I was chairman, I was very meticulous. The SOP must be comprehensive. We had an evaluation process. Only when all these were completed, only then we would proceed.”

He said then Mara Inc chief executive officer Abd Rahim Halim would have more details on the transaction.

Mara large portfolio of overseas property holdings, particularly in Australia, has come under the spotlight following the revelation in 2015 of the scandalous deal to buy another Melbourne property, Dudley House.

Mara’s property division then commissioned separate and independent valuation reports on all its properties.

Valuations by two Melbourne-based companies have confirmed that those involved in the UniLodge deal could have made as much as A$18 million (RM60 million).

Charter Keck Cramer valued the property at A$29.7 million (about RM98 million) while CBRE Valuations Pty Ltd put the price at A$25.5 million (RM84.2 million).

Following this, Mara attempted to sell UniLodge through open tender and the highest bid received was A$31 million (about RM103.2 million).

Sources say the proceeds from this clandestine transaction were moved to an offshore property holding company set up by an Australian law firm named in last year’s Panama Papers.

Investigative journalist Nick McKenzie of the Melbourne-based The Age, who helped uncover the Mara property deals in Australia, said the scandal exposed the use of offshore companies to conceal tax evasion, corruption and money laundering by powerful business and political figures across the globe.

Bank transfer documents reveal that part of that A$18 million was later wired to a former senior Mara official’s overseas bank account. 

Mara Inc’s acquisition of UniLodge through Thrushcross Land has been called into question when it could have bought it directly from the owners – HRSV – at a much lower price.

Mara has a global property investment portfolio, the profits from which are meant to be used to fund, among others, education for poor, rural Malays. – November 29, 2017.