KUALA LUMPUR (Nov 15): Federal Land Development Authority (Felda) and its subsidiary Felda Investment Corporation Sdn Bhd (FIC) yesterday evening filed a RM2 billion suit against its former chairman Tan Sri Mohd Isa Samad, Tan Sri Shahrir Samad, various former directors-general of Felda and Synergy Promenade Sdn Bhd, Synergy Promenade KLVC Sdn Bhd and lawyers.

This is as they had jointly conspired, resulting in injuring and a loss suffered by Felda and FIC through unlawful means and purpose or what it termed as “the plundering” of Felda and FIC during the tenure of former Prime Minister Datuk Seri Najib Razak.

This, according to a statement of claim sighted by theedgemarkets.com, was done by them in the Kuala Lumpur Vertical City (KLVC) project and subsequently those named as executors in the suit had assisted in the cover-up of the alleged fraud in the KLVC project by causing Felda to enter into a scheme of settlement.

The legal document further claimed that Felda, through its FIC subsidiary, entered into various questionable contracts to engage in luxurious and inflated projects on the pretext of aggressive and strategic investments.

It named some of the projects, which included KLVC, and the purchase of hotels like the Grand Borneo Hotel, Grand Plaza Service Apartments and Park City Grand Plaza Kensington in the United Kingdom totalling close to RM880 million, resulting in Felda suffering losses and damage.

All in all, Felda and FIC named 21 individuals and entities in the statement of claim.

The filing of the 124-page suit is based on the government's white paper on Felda tabled to Parliament on April 10 this year.

The white paper claimed Felda in 2011 was a cash-rich statutory body with RM3.9 billion in its bank account but by 2017, this had reduced substantially to RM400 million. Felda's liabilities as at Dec 31, 2017 totalled RM14.4 billion, of which RM12.1 billion, or 84%, are due to financial institutions.

This resulted in Felda needing an injection of RM6.23 billion to sustain its operations and future, which has been said is against the setting-up of Felda that is envisaged to undertake land development schemes and resettlement programs through agricultural, socio-economic activities in order to eradicate poverty in rural areas.

The suit claimed that the modus operandi engaged resulting in the losses saw Felda's subsidiaries getting involved in various projects and contracts to be entered thereby causing confusion and avoiding full scrutiny as if they were done at the main Felda level.

The suit was filed by the firm of Lee Hishammuddin Allen and Gledhill at the High Court registry. The law firm had previously filed two lawsuits against Isa and several former directors for the acquisition of the Asia Plantation Ltd and purchase of two high-end condos in KL.

Besides Isa, Shahrir, Synergy Promenade and Synergy Promenade KLVC, the plaintiffs also named FIC chief executive officer Mohd Zaid Abdul Jalil and former Felda director-generals Datuk Faizoull Ahmad, Datuk Hanapi Suhada and Datuk Abdul Ghani Mohd Ali and the Federal Territories Director of Lands and Mines as defendants.

The defendants are alleged to have plundered Felda in relation to the development of Felda's tracts along Jalan Semarak here. The legal document said the development was effected through fraudulent land transfer instruments and the defendants are alleged to be involved in a conspiracy to defraud Felda through the purported strategic and aggressive investments.

The statement of claim alleged that the deal involves the transfer of 17 tracts along Jalan Semarak to Synergy Promenade and Synergy Promenade KLVC without Felda receiving any payment or benefit.

Felda and FIC are seeking a court order to direct the Federal Territories Director of Lands and Mines to cancel all instruments involved in ownership transfer of the Jalan Semarak tracts, according to the document.

The document said Felda and FIC are seeking a null and void declaration for items including the Felda and FIC letters of award besides the development agreement.

The plaintiffs are seeking compensations, which include RM1.062 billion, from the defendants for violating their fiduciary duties.