Acquisitions by Anwar confidant renews concern over cronyism, conflict of interest

There has been growing concern over the nexus of big business and ruling politicians, once referred to as cronyism and nepotism, in the wake of media reports on a substantial stake secured by a confidant of Prime Minister Anwar Ibrahim in a company shortlisted for the development of a new billion-ringgit immigration system.

Farhash Wafa Salvador, the 41-year-old PKR leader who served as Anwar's political secretary, had emerged as a substantial shareholder in HeiTech Padu Bhd with a 15.91% stake through his company Rosetta Partners Sdn Bhd.

According to him, Rosetta Partners is a subsidiary of Mfivesouthsea Sdn Bhd, which he jointly owns with Kelantan's Sultan Muhammad V.

The purchase in HeiTech Padu came just a day after MyEG Services Bhd acquired a 14.4% equity interest in the company for RM31.25 million cash on March 11.

That same day, HeiTech Padu announced it had received a one-year extension of its contract to maintain the Malaysian Immigration System (MyIMMs) worth over RM13 million.

HeiTech Padu was one of three companies shortlisted by the government to develop the RM1 billion National Integrated Immigration System (NIISe) project, a replacement for MyIMMs.

This was not Farhash's first foray into the world of corporate deals involving public-listed companies with close ties to the government – at least not in the past 16 months. 

Since his boss became prime minister in November 2022, Farhash has been appointed as chairman of three companies: retail chain outlet 7-Eleven which forms part of billionaire tycoon Vincent Tan's empire, a stockbrocking firm, and a fintech company.

While the news rattled observers and analysts, many were willing to give the benefit of doubt to Anwar's pledge for reforms, including doing away with crony capitalism.

As the months passed, and as more doubt was cast on Anwar's reform promises, those previously supportive of him began to question where all this was heading.

These include Ambiga Sreenevasan, long seen as a friend of Pakatan Harapan (PH) and who had led Bersih, the coalition that helped PH galvanise opposition against the previous Barisan Nasional government through mammoth rallies.

In recent times, however, Ambiga has voiced strong displeasure with Anwar, saying that criticism was more tolerated under the previous government.

"I think this government is a litle bit more sensitive than the previous government about criticism," the prominent lawyer recently told MalaysiaNow when asked about her thoughts about the reforms that never came.

"You are saying one thing but doing another. So I personally think that they should stop being so sensitive about criticism."

Farhash's is not the only case that has triggered concern over cronyism and nepotism in Anwar's administration.

The prime minister's own daughter, Nurul Izzah Anwar, who was defeated in the last election, was appointed to advise her father on the economy and finance, sparking a wave of condemnation.

Nurul Izzah, a vice-president of her father's party PKR, is now an adviser to the National Economic and Strategic Coordination Agency, an agency under the finance ministry led by Anwar.

An anti-corruption pressure group said the new acquisitions by Farhash were the latest example of conflict of interest in Anwar's government. 

Malaysia Corruption Watch (MCW) said the conflict was clear as Farhash is a PKR leader and the home ministry, which has the final say on the immigration system, is headed by his party colleague Saifuddin Nasution, the PKR secretary-general.

Farhash has dismissed his critics, saying he is no longer involved in politics. 

But analyst Awang Azman Pawi recently told Singapore's The Straits Times that the acquisitions create a perception of "corruption or crony capitalism". 

"It undermines the principles of fair competition and transparency in business dealings, as other companies may not have the same level of access or influence," he said.

MCW president Jais Abdul Karim meanwhile said that the Malaysian Anti-Corruption Commission (MACC) should get involved and convince Malaysians that all is well in the nexus between government and business.

"It raises questions about good governance and transparency in the process of awarding contracts," Jais told MalaysiaNow.

He also said that the government's claim of fighting corruption could become even more discredited by the developments, which he said reeked of conflict of interest. 

"Failure to seriously deal with the issue of conflict of interest can affect the people's confidence in the government's ability to act fairly and equitably," he said.

MalaysiaNow has reached out to several individuals who have been outspoken about corruption and cronyism to comment on Farhash's acquisition. 

They include Bersih, Transparency International-Malaysia and Edmund Terence Gomez, an economist whose LinkedIn profile says he specialises in "state-market relations and the linkages between politics, policies, and enterprise development".

All of them have either failed to respond or declined to comment.

Meanwhile, checks on Farhash's corporate engagement reveal links with Blumont Group Ltd, a company that was involved in Singapore's 2013 penny stock crash, the city-state's biggest case of stock market manipulation which wiped out nearly S$8 billion in market value in October of that year.

The following year, Blumont Group appointed Farhash, then 31, to its board of directors as a non-executive chairman, among other posts. This was perhaps one of Farhash's earlier forays into the corporate world.

He resigned from Blumont in 2016, the year a PKR sympathiser, John Soh Chee Wen, was arrested in Singapore over the 2013 market crash.

In 2022, Soh was sentenced to 36 years after he was found guilty of 180 charges for his role in manipulating Blumont's stock prices and causing the market to crash.

The former MCA man was a staunch supporter of Anwar when the latter was sacked in 1998 by Dr Mahathir Mohamad. It is open knowledge that Soh went on to become a major funder for PKR.