Revelation By Sarawak Report : Taib Mahmud The Main Shareholder of Mulu Resort

Kuching
Friday, 26th Nov 2010

Sarawak Report today reveals that Sarawak Chief Minister's , Abdul Taib Mahmud, has a major personal shareholding in Sarawak’s highly controversial Royal Mulu Resort, a project that has received huge injections of cash from the State. This means that, as both Chief Minister and Finance Minister, Taib has authorised the diversion of large sums of public money straight into his own pocket.

According to the report, as State Resources and Planning Minister, Taib was also responsible for the forced acquisition of a large area of Native Customary Lands from the indigenous Berawan tribe to build the resort, for which the tribespeople received virtually no compensation. Their evidence therefore further exposes him for having authorised this land-snatch for his own direct benefit.

His shareholding is in a company that was incorporated as recently as November 2007, Mesti Bersatu Sdn Bhd. This in turn has a 50% shareholding of the Taib/Mahmud family company Kenyalang Cergas, one of the main shareholders of Borsamulu Resorts Bhd (BRSB). BRSB was handed the ownership and lucrative management contract for what was once a state-owned National Park, thanks to a series of decisions by Taib’s own government starting in 1991. The management contract is paid for by the taxpayer!

The other major beneficiaries and shareholders of the Royal Mulu Resort are members of his family, including his sister Raziah, her third husband Robert Geneid and the family of his late brother Arip Mahmud. Taib Mahmud has personally accused the Berawan people of being “greedy” for refusing to hand over their lands for ‘development’. Their peaceful protests in the 1990s were brutally put down by army and police and their leaders were imprisoned. Deprived of their territories, these communities are now impoverished and hungry and few people, apart from the Mahmud family, will have difficulty in discerning where the true greed lies.

This time it’s on record

The significance of this official confirmation of the Chief Minister’s own shareholding lies in the fact that Taib has normally sought to disguise his acquisitions and shareholdings in an attempt to avoid widespread allegations of corruption. He habitually uses members of his own family to hold shares on his behalf. Thus, the names of his many brothers and sisters, his late wife, his four children, nieces, nephews, cousins and in-laws are prominent as key shareholders in most of Sarawak’s important businesses.

Insiders have also told Sarawak Report that the elderly Chief Minister has employed a number of other devious methods to keep control of such companies until he is able to extract his wealth and invest it secretly abroad. These methods include forcing his nominees to sign undated resignation letters and share transfer forms, which he can use at any time to force their removal and employ somebody else as his front man or ‘nominee’!

Likewise, Sarawak Report has copies of US documents showing that shares which were publicly registered as belonging to family members were in fact secretly ‘held in trust’ for the Chief Minister himself.

In black and white - Chief Minister Taib Mahmud declares his interest!

Mesti Bersatu Sdn Bhd therefore forms a notable exception, in that Taib declares his financial interest in black and white in Malaysia’s Company Register. It is likely to have been an oversight on his part and a sign of his growing confidence that he can do what he likes in Sarawak and get away with it.

He is registered both as a Director and a Shareholder of Mesti Bersatu and holds 400,000 shares out of the 2,300,000 total shares issued for the company. The other shareholders are his late brother Arif’s three wives (condoned under the Muslim faith) and two grown up daughters. At RM 1.00 per share, Taib’s shareholding represents an outlay of 400,000 ringgit.

The company is registered as having ‘No Operation’ at it’s Kuching address, but in fact owns half the shares in Kenyalang Cergas Bhd, which was set up in 1992 as a direct Shareholder of the Royal Mulu resort. The other Directors and Shareholders of Kenyalang Cergas are Taib’s sister Raziah and her current husband Robert Geneid, who were behind the original development of the resort and act as the main directors of the company. Crony timber tycoons the Yaw family, the owners of Samling, have also put money into the project, along with the architect from Singapore. Crucially the Sarawak State Government has also taken up an interest in the venture and has usefully pumped in large sums of life-saving injections of cash from the taxpayer over the years. That involvement was of course thanks to Taib Mahmud.

All thanks to Taib!

Raziah and Robert Geneid reportedly came up with the plan to develop Mulu, which is famous for its caves, in the early 90s, when Raziah was still married to her 2nd husband. In 1991, thanks to Taib Mahmud the Chief Minister, a decision was made by the Sarawak State Government to alienate land acquired in the National Park for a pitiful sum of RM 80 per acre from a local headman to their new family company the Royal Mulu Resort. The Geneids had no money or hotel experience, but Taib’s brother Arip, who had made money from another family venture Achipeligo Shipping (which has now developed into a separate major scandal over the allegations of billions made in timber kickbacks) invested in the venture.

Berawan land - who cares?

Given that the Chief Minister had alienated profitable state land into the hands of his unqualified sister and brother, the project was from the start corrupt. Even more corrupt has been the continuing support by the state of Sarawak, through the Sarawak Economic Development Corporation, of what has turned out to be a lamentably unprofitable venture. In the name of ‘developing tourism’ the SEDC has been paying what appear to be astronomical ‘management fees’ to the Geneids and their co-shareholders for running their own hotel investment!

This generosity has turned what would have been a disastrous investment and a failed venture into a major money-spinner for Raziah and Robert (the son of an Australian fruit-vendor) who appear to have turned the resort into something of a family forest playground, judging from family facebook sites. Indeed few actual tourists go there and most tourist guides warn visitors that the small sized National Park has long since been stripped of its wildlife by the effects of Taib’s logging activities in all the surrounding areas.

It is also, of course, thanks to Taib that awkward complaints by the local population have been so firmly suppressed by the full force of the state and police. Thus, while the Geneids party in luxury (arriving at their holiday hideaway via a specially-built airstrip that involved blowing off the top of a sacred mountain and taking more of the land that belonged to the natives), the local people have received none of the benefits of the much-trumpeted ’progress and development’.

The Berawan tribe have now returned to court to fight the company’s forced acquisition (thanks to Taib’s government) of yet more of the NCR lands for a second extension of the resort as part of a deal to develop it further, in collaboration with the US-owned Marriott Hotel chain. So far they have received no compensation or recognition of their claims from Taib, despite the fact that previous governments did recognise their ownership of the land.

The Marriott Hotel chain appears to have no shame in participating in this deal, having already collaborated with Raziah Mahmud in developing the Marriott in Miri, again thanks to favours and land alienated by the government of Abdul Taib Mahmud.

However, Unesco which attributed World Heritage status to the site in 2000 has already signalled its own deep concern about the situation at Mulu. Its 2008 report into the management of World Heritage Sites states that the Chief Minister’s plan to flood great areas of Sarawak with dams will also affect Mulu and the report further raises concerns about reports that ” the benefits of tourism and World Heritage designation are not available to the indigenous groups. If these reports were confirmed” the report states “this lack of engagement of local communities could threaten the effectiveness of management and impact the integrity of the property”. The UNESCO report requires reassurances by 2010, which can hardly have been forthcoming.

Furthermore, UNESCO, which in 2000 listed Mulu as a World Heritage site has already raised the management of the park as an issue of concern. In its 2008 report into the management of World Heritage Sites it states that the Chief Minister’s plan to flood great areas of Sarawak with dams could impact on the site and further states that the “lack of engagement of local communities could …impact the integrity of the property”. The report requires reassurances by 2010, which can hardly have been forthcoming.

Local poor are dependent on tourist tips

Despite the usual bragging about ‘progress’ from AbdulTaib Mahmud, the ‘development’ of Mulu has predictably provided no compensation and little in the way of jobs for the local people. The Berawan are apparently banned from being guides in the park they know so well. In return these people have lost their lands and livelihoods and no longer have their hunting grounds. The Geneids and their government partners have therefore provided virtually nothing for the people who they have displaced, many of whom are starving hungry.

Progress and development at Royal Mulu - for the natives that is.

The once nomadic Penan of the area have likewise lost their hunting grounds, due to Taib-sponsored logging all around the actual park (which is on high ground and therefore does not have very interesting trees) and they are now living in shanty settlements on the fringes of the Berawan lands. Far from enjoying the fruits of modernisation they survive from making baskets for the few tourists who come to look at them from the resort hotel. So poor was the standard of housing provided by the Geneids in this ‘progress and development’ scheme that one such tourist himself put up the money to pay for the removal of mosquito-breeding swamps from beneath the settlement’s main longhouse, which had been a major discomfort and health hazard.

So how much has the Sarawak State paid to the Taib family to run Mulu?

Nevertheless, the taxpayer is still being forced to pay substantial sums to the Geneids in the name of ‘developing tourism’, for managing their own venture! The big question is exactly how much has Sarawak invested in this project that is now being taken up by the Marriott? Sarawak Report has ascertained that in 2007, the same year that Taib Mahmud openly acquired his shares in the company, a new contract was drawn up whereby the State was to pay even larger sums into the Borsamulu Resort Company, of which he was now publicly an owner.

Sarawak Report has been informed from reliable sources that the agreement was for Borsamulu’s management subsidiary to be paid RM 50 million a year for 50 years by the state. This means that the State of Sarawak has agreed to pay the Geneids and indeed the Chief Minister himself, RM 50 million a year to manage their own investment until the day they die! We therefore ask the Government of Sarawak if they will please confirm this figure and explain on what grounds they think they can condone such corruption?

Clearly these figures should be made public as it is the right of the people of Sarawak to be informed of the total sum of public money that has been poured into the Geneid’s forest playground since its inception in 1993 and they should also know how much more it is committed to spend.

Marriott Hotel

Sarawak Repot would also like to enquire of the Marriott Hotel Chain whether this continuing support by the Sarawak taxpayer forms part of their ’incentive’ for taking up a joint venture with the Geneids at Borsamulu Resort and also whether the company holds any ethical standards regarding human rights and the environmental impact of their activities? If so, how does their involvement in Borsamulu equate with these standards?

Marriott’s new business partners in their joint venture with Borsamulu Resort include the Chief Minister of Sarawak and his family, the State Government of Sarawak and the logging giant, Samling, recently condemned in an investigation into illegal logging by the Norwegian Government. Since Marriott are re-launching the resort under the auspices of eco-tourism and the Chief Minister and his family can only be described as one of the worst environmental menaces alive on this planet, we would like to ask Marriott how they are planning to deal with this contradictory arrangement?

'Eco-tourism' - a Geneid pal contributes to the destruction of the Mulu homeland of the Berawan Tribe

We would also like to enquire if Marriott can reveal the true identity of another of the major shareholders of Borsamulu, Widervale Assets Limited? We assume that in the course of doing their due diligence into the joint venture eco-tourism project they have identified the owner of this company, however in an instance of extreme irregularity it is not registered on the Malaysian Company Register, despite such a significant holding in a prominent state government-backed concern!

Given that Marriott Hotel Group’s promotional material regarding their planned acquisition of Mulu in 2011 claims confidence in the “eco-tourism potential” of the Royal Mulu Resort, Sarawak Report would finally like to ask on what criteria the Marriott Hotel Group judges ‘eco-tourism’? Their new business-partner, the Chief Minister of Sarawak, has sponsored the destruction of a huge segment of the Borneo rainforest, destroying the landscape of the whole of Sarawak. He authorised the logging of thousands of square miles of virgin rainforest surrounding the tiny Mulu National Park, eradicating most of the wild-life of the region, including inside the Park itself. In the process the local people and native forest tribes have been nearly starved into extinction and left to rot without a shred of compensation. Their protests have been put down by armed police.

We would therefore like to ask the Marriott Hotel Group how they intend to explain and justify these circumstance to their visiting ‘eco-tourists’ and indeed to concerned onlookers at UNESCO’s World Heritage Commission?

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