Guan Eng’s trial: Broker sold watch for double the price to director linked to Penang undersea tunnel project

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However, the broker affirmed that the sale of the Maurice Lacroix watch had nothing to do with Lim Guan Eng and that he had never met the accused prior to today.


A watch broker told the Kuala Lumpur Sessions Court that he sold a RM20,000 luxury watch for double the price to a key prosecution witness in the Penang Undersea Tunnel project corruption case.

K Rajan Gunaretnam said he sold the Swiss-made Maurice Lacroix watch to Datuk Zarul Ahmad Mohd Zulkifli for RM40,000 after buying it for just RM20,000.

The 66-year-old, who used to be a luxury watch broker, had those present in the courtroom sniggering when he testified that he had bought the watch for only half the price from a dealer.

Speaking in English, the fifth prosecution witness in Lim Guan Eng’s corruption trial started off his testimony by stating that he had been introduced to Zarul sometime in 2011 by a mutual friend.

Wan Shaharudin: Did you manage to find the Maurice Lacroix watch as per requested by Datuk Zarul Ahmad?

Rajan: Yes.

Wan Shaharudin: How much did you buy the watch for from the dealer?

Rajan: RM20,000.

Wan Shaharudin: And how much did you sell it for to Datuk Zarul?

Rajan: RM40,000.

Wan Shaharudin: Can you explain why is there a vast difference in prices and how you came to the figure?

Rajan: The normal practice is that the retail price is that and selling price will be that, so here the retail is RM40,000, and for the dealers is RM20,000. Most luxury products have a 35-50 percent margin.

During cross-examination by defence lawyer Gobind Singh Deo, Rajan explained that as a watch broker, he would reach out to Zarul if and when he came across several “good” watches he thought the latter might be interested in.

“When I get some good watches, I will buy them and call him. He will then tell me to bring them over and he would buy the watches,” he said.

Rajan said they usually met in Zarul’s office and he would usually show the latter between three and 10 different timepieces.

He said Zarul told him the watches were purchased for his staff and some for his personal collection.

But Rajan affirmed that the sale of the Maurice Lacroix watch had nothing to do with Lim.

He said he had never met the accused prior to today.

“No sir, I have never met. I have not seen him and have had no dealings with him,” he replied Gobind when asked about his relationship with Lim.

Earlier, Muhamad Azrai Mohamad Zaini, the prosecution’s fourth witness, who is a Penang government official said the Beijing Urban Construction Group (BUCG) held an advantage when bidding for the 2012 project following their involvement in state government meetings discussing the scope of the project, and through a Memorandum of Understanding (MoU) that was signed between the developer and the state administration.

He said BUCG’s initial involvement with the MoU was nothing out of the ordinary, but things changed when the company subsequently became a bidder. He explained that helping conceptualise the project effectively gave BUCG the upper hand.

In his previous testimony, Muhamad Azrai told the court that he saw a possible conflict of interest with BUCG’s early involvement on the project, but not necessarily to the point that it would be an unfair advantage during bidding.

Muhamad Azrai was at that time the assistant director of infrastructure in the Penang State Economic Planning Unit. He is currently private secretary to current Penang Chief Minister Chow Kon Yeow.

After the fifth prosecution witness, the proceedings were adjourned as Lim and Gobind, who are MPs for Bagan and Puchong respectively, needed to attend an important proceeding at Parliament.

The trial before judge Azura Alwi will resume tomorrow morning.

Lim is facing four charges in relation to the undersea tunnel project.

He is accused of soliciting a 10 percent cut in profits from the project from Zarul, who is Consortium Zenith BUCG managing director.

He is also accused of seeking RM3.3 million in kickbacks to appoint Zarul’s company to undertake the project, and another two charges of dishonestly misappropriating RM208.7 million worth of state land to two companies.