Mara Inc bought overvalued properties in London and Melbourne — PAC

• “The Ministry of Finance did not authorise these purchases, but the Ministry of Rural and Regional Development (KKDW) appealed [for them], and the matter was brought to the Economic Council, which then approved it in 2013.”

KUALA LUMPUR (Nov 26): The Public Accounts Committee (PAC) has found that Mara Incorporated Sdn Bhd (Mara Inc) purchased overvalued properties in London and Australia in 2013 and 2014.

The properties include Dudley International House, an eight-floor student dormitory at 51 Queen Street, and 333 Exhibition Street in Melbourne, purchased in 2013.

The two properties were purchased for a total of RM72.64 million, but currently valued at only RM47.45 million, according to the PAC.

Another property was Beaumont House in London, purchased in 2014 for RM78.53 million, but currently valued at RM74.1 million.

“The Ministry of Finance (MOF) did not authorise these purchases, but the Ministry of Rural and Regional Development (KKDW) appealed [for them], and the matter was brought to the Economic Council, which then approved it in 2013,” said PAC chairperson Datuk Mas Ermieyati Samsudin in a statement on Tuesday.

Mara Inc is a wholly owned subsidiary of Mara Corp, which is supervised by the KKDW.

According to Mas Ermieyati, the acquisition of overvalued properties in Melbourne, Australia, led to an investigation by the Malaysian Anti-Corruption Commission (MACC), and the case is still being heard in court.

The committee recommended that KKDW, Majlis Amanah Rakyat (Mara), Mara Corp, and Mara Inc obtain prior approval from the MOF for all proposed investments to ensure that “property purchase scandals do not recur”.

To recap, former Mara Inc chairman Datuk Mohammad Lan Allani in 2021 and 2022 pleaded not guilty to 24 charges of corruption and money laundering over the controversial property purchases in Melbourne.

This came after the anti-graft agency initiated an investigation in 2020, following claims by Australian newspaper The Age that a group of wealthy Malaysian officials overpaid by A$4.75 million (RM13.8 million) for Dudley International House in 2013, with the difference allegedly channelled to several individuals.

Premiera Hotel

Meanwhile, the PAC also highlighted Mara Inc’s application to convert its subsidiary Premiera Hotel’s existing debt into equity, which is still under consideration by the MOF.

According to the PAC, Premiera Hotel has rental arrears totalling RM22.67 million, with RM22.4 million owed for Menara Mara and RM270,000 for Living at dsulaiman.

The PAC noted that this is the second attempt by Mara Inc to convert debt into equity, after the first attempt in 2015.

“This was a move that should not have happened. The PAC recommends that KKDW, Mara, Mara Corp, and Mara Inc have clear plans to ensure that the conversion of debt into equity will bring returns that contribute to the company’s sustainability,” said Mas Ermieyati.

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