Scomi Precision Engineering nuclear scandal
Encyclopedia
Syarikat Scomi Precision Engineering Sdn Bhd (SCOPE) was established under the Scomi
group of companies controlled by Kamaluddin Abdullah, a businessman who is the son of former Malaysian Prime Minister Abdullah Ahmad Badawi
. On February 4, 2004, the New York Times carried a story claiming that SCOPE supplied nuclear components to Libya as part of a rogue network masterminded by Pakistani atomic weapons supremo Dr A.Q. Khan
. Scomi denied any wrongdoings. However, in 2009, the US Department of State announced that sanctions would be imposed on Scomi Chief Executive Officer, Shah Hakim Zain
for his involvement in Dr Khan's nuclear proliferation network. Subsequently, following US Govt sanctions on Shah Hakim, he has fought to clear his name in that country, and succeeded in 2011. The sanctions were lifted by the US State department on Monday, 18th July, and the news was covered in Malaysian papers. Shah issued a statement as well saying, "In reference to the lifting of the sanctions imposed, I am grateful to all who have helped, guided and supportedScomi Group and I for the past few years, in particular to the Government of Malaysia and all the agencies. I would like to express my gratitude to the State of Department, United States of America for their assistance and for the lifting of the sanctions"
. The General Manager of SCOPE was Shamsul Bahrin Rukiban. In 2001, SCOPE was reported to have secured a contract to supply components to a Dubai-based customer.
In 2002, Scomi
CEO, Shah Hakim Zain
, was appointed director of SCOPE along with Mansor Tahir and Hilmy Zaini Zainal. In that year, the company had MYR250,000 in paid up capital. Assets of MYR1.5 million, turnover of MYR12 million and profits of MYR1 million.
On 7th January 2005, Scomi Group Bhd
proposed to acquire from SCOPE 250,000 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital of SCOPE for RM250,000 from its wholly owned subsidiary company, Scomi Sdn. Bhd. The control of the net assets and operations of SCOPE was effectively transferred to Scomi Group Bhd
and the Group’s effective interest in SCOPE remained unchanged at 100%.
sell nuclear secrets and supplies to Iran and Libya. He was detained without trial from 2006 to 2008 for allegedly being a national security risk, having been accused of fraudulently convincing SCOPE to produce components for centrifuges to be used in Libya's secret uranium enrichment program.
Scomi officials insisted that B.S.A. Tahir had misled them to believe that the parts were intended for the oil and gas industry. However, Tahir is reported to have said that Shah Hakim Zain
and Kamaluddin both knew the final destination of the products. He has accused Scomi of making fraudulent declarations and in 2009 he sued Shah Hakim and Kamaluddin for MYR75 million.
were arrested by Tokyo Police in connection with the sale of equipment to Scomi
, for the production of the centrifuge. Mitutoyo
was also investigated for supplying expertise to SCOPE related to the centrifuge manufacturing
project.
CEO, Shah Hakim Zain
and SCOPE GM, Shamsul Bahrin, for their involvement in Dr Khan's
nuclear proliferation network. These sanctions have the effect of prohibiting Shah Hakim or Shamsul Bahrin from doing business with the US government. However, Scomi itself was not among the companies listed in the sanctions.
Malaysia has ratified the Nuclear Non-Proliferation Treaty
. Following the breaking of the SCOPE scandal, the Malaysian government promised to tighten controls on exports of weapons-related equipment. However, in 2007 there were further reports that a Malaysian company was involved in the illegal arms trade, this time involving another Pakistani arms dealer, Jilani Humayun
. There are no reports of the Malaysian government having taken action against the Malaysian company in either the case of Abdul Qadeer Khan
or in the case of Jilani Humayun
.
Scomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
group of companies controlled by Kamaluddin Abdullah, a businessman who is the son of former Malaysian Prime Minister Abdullah Ahmad Badawi
Abdullah Ahmad Badawi
Tun Abdullah bin Haji Ahmad Badawi is a Malaysian politician who served as Prime Minister from 2003 to 2009. He was also the President of the United Malays National Organisation , the largest political party in Malaysia, and led the governing Barisan Nasional parliamentary coalition...
. On February 4, 2004, the New York Times carried a story claiming that SCOPE supplied nuclear components to Libya as part of a rogue network masterminded by Pakistani atomic weapons supremo Dr A.Q. Khan
Abdul Qadeer Khan
Abdul Qadeer Khan , also known in Pakistan as Mohsin-e-Pakistan , D.Eng, Sc.D, HI, NI , FPAS; more widely known as Dr. A. Q...
. Scomi denied any wrongdoings. However, in 2009, the US Department of State announced that sanctions would be imposed on Scomi Chief Executive Officer, Shah Hakim Zain
Shah Hakim Zain
Shah Hakim @ Shahzanim bin Zain is Chief Executive Officer and controlling shareholder of the Malaysian public company Scomi Group Bhd.-Background, early corporate years:...
for his involvement in Dr Khan's nuclear proliferation network. Subsequently, following US Govt sanctions on Shah Hakim, he has fought to clear his name in that country, and succeeded in 2011. The sanctions were lifted by the US State department on Monday, 18th July, and the news was covered in Malaysian papers. Shah issued a statement as well saying, "In reference to the lifting of the sanctions imposed, I am grateful to all who have helped, guided and supportedScomi Group and I for the past few years, in particular to the Government of Malaysia and all the agencies. I would like to express my gratitude to the State of Department, United States of America for their assistance and for the lifting of the sanctions"
Company profile
SCOPE was set up as a subsidiary to Scomi Group on 4 Dec 2001. Before SCOPE was set up as a subsidiary of Scomi, it was known as Prisma Wibawa Sdn. Bhd. (PWSB). At first, PWSB had no production facility but after SCOPE was set up, a production facility was set up in 2001 in Shah AlamShah Alam
Shah Alam is the state capital of Selangor, Malaysia situated within the Petaling District and a small portion of the neighboring Klang District. It is located about west of the country's capital, Kuala Lumpur. Shah Alam replaced Kuala Lumpur as the capital city of the state of Selangor in 1978...
. The General Manager of SCOPE was Shamsul Bahrin Rukiban. In 2001, SCOPE was reported to have secured a contract to supply components to a Dubai-based customer.
In 2002, Scomi
Scomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
CEO, Shah Hakim Zain
Shah Hakim Zain
Shah Hakim @ Shahzanim bin Zain is Chief Executive Officer and controlling shareholder of the Malaysian public company Scomi Group Bhd.-Background, early corporate years:...
, was appointed director of SCOPE along with Mansor Tahir and Hilmy Zaini Zainal. In that year, the company had MYR250,000 in paid up capital. Assets of MYR1.5 million, turnover of MYR12 million and profits of MYR1 million.
On 7th January 2005, Scomi Group Bhd
Scomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
proposed to acquire from SCOPE 250,000 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital of SCOPE for RM250,000 from its wholly owned subsidiary company, Scomi Sdn. Bhd. The control of the net assets and operations of SCOPE was effectively transferred to Scomi Group Bhd
Scomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
and the Group’s effective interest in SCOPE remained unchanged at 100%.
BSA Tahir
Soon after the NY Times article, the Malaysian police announced that one of Scomi's main backers, B.S.A. Tahir, had confessed to helping Dr KhanAbdul Qadeer Khan
Abdul Qadeer Khan , also known in Pakistan as Mohsin-e-Pakistan , D.Eng, Sc.D, HI, NI , FPAS; more widely known as Dr. A. Q...
sell nuclear secrets and supplies to Iran and Libya. He was detained without trial from 2006 to 2008 for allegedly being a national security risk, having been accused of fraudulently convincing SCOPE to produce components for centrifuges to be used in Libya's secret uranium enrichment program.
Scomi officials insisted that B.S.A. Tahir had misled them to believe that the parts were intended for the oil and gas industry. However, Tahir is reported to have said that Shah Hakim Zain
Shah Hakim Zain
Shah Hakim @ Shahzanim bin Zain is Chief Executive Officer and controlling shareholder of the Malaysian public company Scomi Group Bhd.-Background, early corporate years:...
and Kamaluddin both knew the final destination of the products. He has accused Scomi of making fraudulent declarations and in 2009 he sued Shah Hakim and Kamaluddin for MYR75 million.
Japanese involvement
On 26th August 2006, the CEO and four executives of the Mitutoyo CorporationMitutoyo
is a Japanese multinational corporation specializing in measuring instruments and metrological technology, headquartered at Mizonokuchi, Kawasaki, Kanagawa.Mitutoyo was founded in 1934 by Yehan Numata with one product, the micrometer...
were arrested by Tokyo Police in connection with the sale of equipment to Scomi
Scomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
, for the production of the centrifuge. Mitutoyo
Mitutoyo
is a Japanese multinational corporation specializing in measuring instruments and metrological technology, headquartered at Mizonokuchi, Kawasaki, Kanagawa.Mitutoyo was founded in 1934 by Yehan Numata with one product, the micrometer...
was also investigated for supplying expertise to SCOPE related to the centrifuge manufacturing
Nuclear proliferation
Nuclear proliferation is a term now used to describe the spread of nuclear weapons, fissile material, and weapons-applicable nuclear technology and information, to nations which are not recognized as "Nuclear Weapon States" by the Treaty on the Nonproliferation of Nuclear Weapons, also known as the...
project.
U.S. sanctions
On January 12, 2009, the US Department of State announced that sanctions would be imposed on Dr Khan and a number of his alleged associates including BSA Tahir, ScomiScomi
Scomi Group Berhad is a global service provider based in Malaysia mainly involved in oil and gas and transport engineering.Scomi Group Bhd which is listed on the main board of Bursa Malaysia Securities Berhad, and its Group of companies are involved in three core businesses: Oilfield Services;...
CEO, Shah Hakim Zain
Shah Hakim Zain
Shah Hakim @ Shahzanim bin Zain is Chief Executive Officer and controlling shareholder of the Malaysian public company Scomi Group Bhd.-Background, early corporate years:...
and SCOPE GM, Shamsul Bahrin, for their involvement in Dr Khan's
Abdul Qadeer Khan
Abdul Qadeer Khan , also known in Pakistan as Mohsin-e-Pakistan , D.Eng, Sc.D, HI, NI , FPAS; more widely known as Dr. A. Q...
nuclear proliferation network. These sanctions have the effect of prohibiting Shah Hakim or Shamsul Bahrin from doing business with the US government. However, Scomi itself was not among the companies listed in the sanctions.
Malaysian government response
Given the role of the Prime Minister's son as a major shareholder of Scomi, there were calls for an independent inquiry to be carried out into the allegation of Malaysia's role in Dr Khan's network. However, no independent inquiry was carried out. Following the 2009 decision to impose sanctions on Shah Hakim, the Malaysian Government announced that it would carry out further investigations into the matter. However, no further announcement has been made.Malaysia has ratified the Nuclear Non-Proliferation Treaty
Nuclear Non-Proliferation Treaty
The Treaty on the Non-Proliferation of Nuclear Weapons, commonly known as the Non-Proliferation Treaty or NPT, is a landmark international treaty whose objective is to prevent the spread of nuclear weapons and weapons technology, to promote cooperation in the peaceful uses of nuclear energy and to...
. Following the breaking of the SCOPE scandal, the Malaysian government promised to tighten controls on exports of weapons-related equipment. However, in 2007 there were further reports that a Malaysian company was involved in the illegal arms trade, this time involving another Pakistani arms dealer, Jilani Humayun
Jilani Humayun
Jilani Humayun is a Pakistani-American arms trader who was arrested in New York on July 19, 2007, and charged in the United States District Court for the Southern District of New York with 11 counts of violating the federal Arms Export Control Act, one count of conspiracy to commit mail fraud and...
. There are no reports of the Malaysian government having taken action against the Malaysian company in either the case of Abdul Qadeer Khan
Abdul Qadeer Khan
Abdul Qadeer Khan , also known in Pakistan as Mohsin-e-Pakistan , D.Eng, Sc.D, HI, NI , FPAS; more widely known as Dr. A. Q...
or in the case of Jilani Humayun
Jilani Humayun
Jilani Humayun is a Pakistani-American arms trader who was arrested in New York on July 19, 2007, and charged in the United States District Court for the Southern District of New York with 11 counts of violating the federal Arms Export Control Act, one count of conspiracy to commit mail fraud and...
.