Scams, fading prospects and pensioners’ plight

The government must move out of the snake pit of snake charmers and snake oil-selling operations

NASIR HASHIM

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By M Santhananaban

So many people in Malaysia seem to have been duped and have become victims of scary scams.

Jobs, junk investments and juicy though shady deals are often dangled to lure the naive.

Some pensioners or retirees seem to be losing their hard-earned gratuities, small saving and insurance payouts to scam artists. Once their money is lost, it becomes untraceable.

This victimhood seems to be the parlous and pathetic lot of some retired professionals, technocrats, teachers and other ordinary workers. Some of them are so embarrassed about their terrible experiences, they are unable to share it even with family members and friends.

Regulatory institutions, enforcement bodies and the police appear unable to control or reduce this phenomenon.

Pensioners and about-to-be retirees seem particularly vulnerable.

Shady ‘entrepreneur’

Then there is another type of scam, a far from respectable but equally rotten scam.

Some supposedly highly regarded entrepreneur comes into the lives of soon-to-be retirees, just before their mandatory retirement date. These scammers offer their targets enticing investment prospects, board directorships, business partnerships and employment as a senior vice-presidents of their conglomerates to take charge of government affairs.

While these offers are being made, the entrepreneur extracts from the prospective retiree highly profitable favours related to specific businesses.

Indeed, the unscrupulous ‘entrepreneur’ invariably enlists the energies and experience of an esteemed technocrat to intentionally launch a fly-by-night business scheme. When the target reaches his or her retirement age, that same prospective employer could talk of a declining business environment and staff layoffs and inform his victim politely that the time is just not propitious.

Or a government employee might move from a government position into a well-remunerated private sector position. While there is nothing wrong with that, it would be better if there is at least a six-month interval between the two roles.

Let us take another particularly egregious case. It involves an about-to-retire ambassador.

A prominent high-profile entrepreneur contacts the ambassador and seeks advice on some business proposal. The entrepreneur flatters the ambassador that he had been advised that the latter is particularly knowledgeable about a certain subject.

So the businessman flies in his own private jet into the capital city where the ambassador is stationed.

The ambassador does all those things usually required, including arranging appointments with potential investors, high government officials and other key contacts.

The following day, the ambassador flies with the entrepreneur in the latter’s plush jet to the industrial centre of the country. Many doors are opened to the entrepreneur and the mayor of the city hosts a luncheon in honour of the entrepreneur.

A few weeks later… another visit. On the second visit too, the ambassador hosts the entrepreneur at a large sit-down dinner with polished silver, shiny crystal and crested crockery and cutlery, with uniformed waiters in attendance. The cost of the entertainment is borne by the Malaysian taxpayer.

In the course of the two visits, the ambassador is promised a position in one of the entrepreneur’s listed companies. The position carries monthly allowances, sitting allowances, a chauffeur- driven car and a plush apartment in one of Kuala Lumpur’s most prestigious residential areas.

Barely two months after these two visits, the ambassador retires and returns to Kuala Lumpur, visits his kampong in the northern part of the peninsula for a month and then attempts to call on the entrepreneur. That call does not materialise.

After over 10 years, the former ambassador shares this story with some other acquaintances who were similarly acquainted with this prominent entrepreneur.

A more classic case involves the most highly placed bureaucrats in policy, regulatory and security institutions. Upon retirement, an entrepreneur with a business proposal approaches a bureaucrat.

The bureaucrat realises that with the entrepreneur’s legendary business acumen and his fabled wealth, the prospects for that project to take off are there.

What the entrepreneur wants from the highly placed bureaucrat is specifically the reputable bureaucrat’s good name, experience and connections to facilitate access and secure loans, licences, permits, leeway in leasing land and, most importantly, the approval of various government agencies to pursue a particular project.

The bureaucrat is persuaded to accept the position being offered because of the attractive income and perks.

But once that retired bureaucrat is employed in the private establishment, he realises the loans and lease were being put to private use rather than the designated purpose.

The bureaucrat has been deceived, but because he has accepted the employment, he cannot wriggle out of the situation. The cost of the scam, which runs into millions of ringgit, is borne by the taxpayer.

Bureaucrats generally conform and comply with public integrity principles.

Admittedly, a few bad apples holding office within the bureaucracy start serving their prospective post-retirement employers while still in active service. Some of these characters get rewarded with lucrative private sector positions upon their retirement from public service.

There is a need to impose some conditions before allowing these retirees to take up private sector positions in areas previously under their purview.

Government-linked firms

There is also a small category of top civil servants who, upon retirement, are appointed to provide direction and leadership of government-linked entities.

Little thought seems to have been given to the type of competitive or facilitation business they are required to lead.

In recent years, quite a few of these government-linked companies have sustained huge losses and have failed. Perwaja Steel and the Port Klang Free Zone (PKFZ) are two particularly bad examples.

What the government did was that it transplanted circular, directive and command-issuing bureaucrats into essentially business, commercial and supportive facilitation agencies.

The appointed ones are the highly successful operatives from a kiss-up, kick-down hierarchical system. They are clueless about baselines in business, balanced risk-taking, public relations skills, analysis of market conditions, negotiations and other entrepreneurial qualities. Often appearing street smart on substantive issues though, in reality, inefficacious, they get to enjoy their cushy chairmanships of government-linked firms, attractive allowances and other benefits with no personal stake or skin in the game.

When you see the names of certain recycled civil servants named to head these large corporations, you have to wonder how a functioning state can make these disastrous choices.

It is time to re-examine such opaque decision-making and prune down the government-linked companies, which should be run on sound commercial lines by professionals.

Recycled civil servants have no place in these entities. These recycled civil servants don’t possess the right vibes, versatility and virtues to understand competing vehicles and vendors in the internal and external environment. They also don’t possess the valour to admit they are not up to the mark for the task.

When these government-linked firms fail, we see an established pattern of covering up and attempts at bailouts. Billions have been lost this way. This cannot go on.

Few business entities from Malaysia have made the grade internationally. Beyond the iconic Shangrila brand, there is perhaps Selangor Pewter and the operations of Sime Darby. Malaysia Airlines once had a good reputation, which was ruined by unsavoury unprofessional management.

We should aspire for world-class universities, business entities and public utilities. But after the 1MDB scandal, the country’s reputation has gone to the dogs.

Aggrieved pensioners

The vast majority who serve with undivided loyalty get by on their meagre pensions.

Appallingly, the group who worked faithfully for the government until December 2012 have been shortchanged with pensions that are not commensurate with prevailing public sector salaries. It does seem odd that even after a Federal Court decision, this issue has not been rectified.

From all this, it appears that honest, dedicated, loyal and some outstanding retirees from the public sector are being subject to all kinds of taunts, trickery and trouble.

The reality is that the older pensioners in their seventies and beyond are an alienated and marginalised group. They are on a reduced income with creeping inflation, a convulsing corruption culture and a declining ringgit. They should not be made to bear these difficulties in their twilight years.

The government must move out of the snake pit of snake charmers and snake oil-selling operations.

Dato’ M Santhananaban is a former ambassador with 45 years of public sector experience

The views expressed in Aliran's media statements and the NGO statements we have endorsed reflect Aliran's official stand. Views and opinions expressed in other pieces published here do not necessarily reflect Aliran's official position.
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