KUALA LUMPUR: The name of former Royal Malaysian Navy (RMN) chief Vice-Admiral (Rtd) Tan Sri Ahmad Ramli Mohd Nor, who has since been charged in court on three counts of criminal breach of trust involving the littoral combat ship (LCS) project, is mentioned in the Boustead Heavy Industries Corporation Bhd forensic audit report.
According to the report, a heavily redacted version of which declassified and released last night on the Parliament website, Ramli, who acted as director of management and chairman of the LCS Steering Committee (LCSSC) at that time, had absolute power over the project management.
For that reason, he gave the green light to the then director of the LCS programme, Captain Anuar Murad, to decide on various letters of award (LoA) and variation orders (VOs) on vendor selection.
"According to the terms of reference of the LCS Steering Committee, members of the committee are elected by the BHIC managing director with no discussion involving the board of directors (BOD), and where the management director will be the chairman.
"It provides the director absolute management control and this has led to a lack of freedom among committee members.
"As a result, there is a surplus of members and failure to perform their functions in which they are selected for the LCSSC.
"The director of the LCS programme at that time took advantage of the situation and, with the permission of Ahmad Ramli, acted arbitrarily when deciding on the LoA and VO," he said.
On Aug 16, the 78-year-old Ramli was charged in the Sessions Court here with three counts of CBT involving more than RM21 million in the LCS projects between 2010 and 2011 He pleaded not guilty to all three charges.
The forensic audit report added that the committee members also submitted no objections to the decision made by the management on the selection of vendors for the LCS programme.
He said that for most of the cases, the LoA was issued to Contraves Advanced Devices Sdn Bhd (CAD) or Contraves Electrodynamics (CED) Sdn Bhd, without being presented to LCSSC for its permission.
CAD and CED were companies appointed by Boustead Naval Shipyard Sdn Bhd (BNS) to buy equipment from original equipment manufacturers.
The BOD also empowered Ahmad Ramli to consult on the terms and implement contracts with CAD without asking for their approval.
According to the report, important decisions were made through the director's circular resolution (CDR) without the board meeting, thus reducing transparency and opportunities to discuss and review specific documents before approving the resolution.
It said the board also ignored the advice of the former RMN chief who opposed DCNS being picked for its design and support contracts.
DCNS, now known as the Naval Group, is a subcontractor of the LCS project assigned to assist BNS in the construction of six LCS for the RMN.
According to the report, Ramli's power to execute and sign all agreements and LoAs with CAD had reduced the effectiveness of the BOD and LCSSC's respective roles.
"Under basic norms of an administration, negotiations with CAD should be implemented through the technical and commercial teams, and then they are presented to the BOD and LCSSC for approval, before the LoA continues," he said.