Purchase price of Guan Eng’s bungalow could possibly be set before August 2013, court told

KUALA LUMPUR (March 27): The purchase price of Penang chief minister Lim Guan Eng’s (pictured) bungalow located on Jalan Pinhorn could had been set with the previous owner Phang Li Koon before August 2013, the Penang High Court heard today during Guan Eng’s corruption trial.

Certified financial planner Lim Wern Shern, who was also a former Citibank sales manager, told the court that Guan Eng, through his wife Betty Chew Gek Cheng, had contacted him about applying for a loan of RM2.1 million in August 2013 to purchase the home, the Malay Mail Online reported today.

However, the client did not proceed with the application from that episode, Wern Shern said.

“On June 5, 2015, Chew contacted us again to proceed with the loan. I met her at her office and informed her that a new application must be made,” he said, reported The Malaysian Insight newsportal.

Wern Shern said Guan Eng then signed for the second loan application for the same amount of RM2.1 million later that month and the application was approved in July 2015. 

It would be a 15-year loan with RM16,172.39 being paid a month, Wern Shern said. 

The RM2.1 million is 75% of the price of the house (sold to Guan Eng by Phang at RM2.8 million in 2015).

The prosecution said the bungalow was valued at RM4.27 million at the time of purchase in 2015.

He said it was possible that Guan Eng and the original owner had agreed on the price of the house before he submitted applications for a housing loan.

Wern Shern also told the court that the price of the property may in the end be quite different from the initial price agreed upon owing to the duration it takes to finish the sale.

Wern Shern is the prosecution’s 12th witness on the second day of the Penang chief minister’s graft trial before judge Hadhariah Syed Ismail over the purchase of the Jalan Pinhorn bungalow.

Last June 30, Guan Eng pleaded not guilty to two corruption charges brought by MACC, consisting of allegations concerning his involvement in the conversion of a piece of land from agricultural status to residential, and for allegedly buying a bungalow below market value.

According to deputy public prosecutor Datuk Masri Mohd Daud, Guan Eng is alleged to have used his position as a civil servant, namely chief minister, to gain gratification for himself and his wife Chew by approving an application to convert the land to public housing in Balik Pulau for a company, Magnificent Emblem Sdn Bhd.

Lim is alleged to have committed the offence while presiding over the Penang State Planning Committee meeting as its chairman at the operations room, Level 28, Komtar, on July 18, 2014.

Under Section 23 of the MACC Act 2009, he can be jailed up 20 years and a fine of up to five times the sum or value of the bribe or RM10,000, whichever is higher, upon conviction.

In the second charge, he is alleged to have used his position to buy his bungalow on July 28, 2015 from Magnificent Emblem director Phang for RM2.8 million, which is allegedly less than the RM4.27 million market value.

If found guilty under Section 165 of the Penal Code, Lim can be sentenced to a two-year jail term, or a fine or both.

Meanwhile, Phang, 46, pleaded not guilty to abetting Lim in obtaining the bungalow at an undervalued cost.

She is liable to two years or fine or both, if found guilty under Section 109 of the Penal Code read together with Section 165.