PKR Internal Crisis Deepens

PKR crisis deepens, Jeffrey advises Anwar to scrap visit

Fri, 27 Aug 2010 16:12

By Luke Rintod

KOTA KINABALU: The cracks in PKR appear to be widening with vice- president Jeffrey Kitingan accusing PKR adviser Anwar Ibrahim of destroying the peace plan brokered late last year to restore normalcy in the party in Sabah.
Jeffrey said PKR had two options last year: one was to take action against those involved in forming a breakaway party through suspension or sacking; and the second was reconciliation.

He added that the party chose to reconcile and agreed to some of his demands. In return, his 12 supporters agreed to restore normalcy, including withdrawing the application to register a breakaway party, Parti Cinta Sabah (PCS)

"The party cannot now abandon the reconciliation plan and go back to castigating and punishing the people involved.

“This has reflected badly against decision-makers in the party," said Jeffrey.

FMT also learnt that Jeffrey has advised Anwar to postpone his scheduled visit to Menggatal, Putatan and Papar tomorrow to another date.

In a statement which he released later in the day, Jeffrey said the decision to recommend the suspension of the 12 was done in bad faith and was a breach of trust.
"The decision by the party's political bureau on Wednesday, after making a reconciliation eight to 10 months ago, reflects badly on the leadership and its sincerity in its intentions, given that it comes just days before the nomination of the party election tomorrow and Sunday,” he said.

He warned Anwar to be prepared for a backlash as a result of this move.

Did Anwar break his word?
In a related development, Jeffrey in an interview with blogger Haris Ibrahim also spoke about how Anwar had reneged on his word.

Yesterday, the PKR disciplinary board recommended that 12 Sabah PKR leaders, aligned to Jeffrey, be suspended for wanting to register PCS.

The 12 had filed the application with the Registrar of Societies, following a leadership tussle last year. They had wanted Jeffrey to lead Sabah PKR.

Following a peace deal, the application was retracted.

Asked if the application to register the new party was raised at the peace talks, Jeffrey replied, “Yes, when it was decided to reconcile, it was also decided that no action would be taken against those who took part in setting up the new party.”

“In return, Thamrin Jaini’s appointment (as Sabah PKR chief) would be accepted whilst there was also an agreement on the appointment of some others, like the secretary and ketua penerangan (information chief), but even this was not implemented,” he added.

On whether the assurance that “no action would be taken” was expressly raised and agreed during the peace talks, he said: “It was agreed to by the Ketua Umum PKR (Anwar). It (the decision) was conveyed to me by the Ketua Umum through a third party.”

According to Jeffrey, the assurance was conveyed verbally as well as in writing.
He also denied the claim that Anwar and other leaders were not aware that the application was submitted to the Registrar of Societies, and at the time of the peace talks, they were under the impression that a new party was merely being contemplated.

The veteran politician was also in the dark about why the party had suddenly decided to make a U-turn on this issue.

“I have no idea, although it does look like it might have to do with the party elections. Somebody complained and now it looks like we are going backward,” he said.

“The 12 have been very honest. They told the truth. They abandoned their plan about a new party after we made a peace plan and we reconciled and then how can this now be done to them? At the time of submission of nomination papers (for the divisional election)? This will disqualify these people. This is not fair.

“We are fighting for justice and democracy. This will in effect deprive these people of the opportunity to exercise their right. It effectively undermines the democratic process in the party,” he added.

Below are excerpts from the interview:

The party will decide this coming Sunday whether to adopt and give effect to the recommendation to suspend the 12. Where do you go from there if they do adopt the recommendation to suspend?
Well, I will cross that bridge if and when we get there. Right now, what I would like to suggest to the leadership is to withdraw the decision and to resume party activities. After all, a decision had been made 9 or 10 months ago that we make a peace plan and we reconcile.

Are you therefore urging the party leadership to look at the bigger picture and push forward with the peace plan?
Yes. To me, whatever they are doing now is already irrelevant because a decision had been made to reconcile and make a peace plan and we have moved along that line for about a year already. Are we now going backward and say, 'throw the peace plan away?' Where is the direction? The party has earlier made a decision and they should stick to that decision.

Would you say that this latest development puts PKR Sabah in a very precarious position?
Indeed, it does.

Also read:
PKR decision will backfire in Sabah, say supporters 
FMT

UMNO in Business

Shares dispute reveals Umno-corporate nexus

By Jahabar Sadiq
Editor

August 27, 2010

Dr Mahathir was identified as one of those given a copy of the “Umno Trust”. — file pic

KUALA LUMPUR, Aug 27 — The nexus between Umno and certain conglomerates has been revealed further in a High Court hearing last week involving the past shareholders of Realmild Sdn Bhd, the shadowy company that took over media giant The New Straits Times Press (Malaysia) Bhd in 1993, and Malaysian Resources Corporation Berhad (MRCB). Former Realmild director Datuk Khalid Ahmad had sued Datuk Seri Abdul Rahman Maidin in March 2005 for RM10 million over the sale of a five per cent stake in the company in 1999, which took place during a shake-up and buy-out related to Datuk Seri Anwar Ibrahim’s sacking from government.
Abdul Rahman had paid RM5 million but later reneged on the remainder as he learnt from Tun Dr Mahathir Mohamad that the shares actually belonged to Umno.
Abdul Rahman is also now seeking to recover the RM5 million he paid to Khalid, saying the businessman had misrepresented the ownership of the shares.
However, Khalid has maintained that the five per cent stake was his own although he acknowledged that the majority stake was part of an “Umno Trust”. The other directors in Realmild then were former Berita Harian group editor Datuk Ahmad Nazri Abdullah, New Straits Times group editor Datuk Abdul Kadir Jasin, and Mohd Noor Mutalib, who replaced Khalid as NSTP managing director in February 1993.
The dispute in the High Court’s commercial division is to resume on September 1 with testimony from witnesses that Realmild’s ultimate beneficial owner is Umno.
In documents made available to The Malaysian Insider, Khalid outlined in his writ of summons that Abdul Rahman had approached him for his five per cent stake in Realmild sometime in July 1999 and that he had agreed to sell 355,050 ordinary shares for RM15 million, which was half of what he estimated to be the fair value for the shares.
Realmild, originally a RM2 company, was then already the majority shareholder of MRCB, which is now developing the KL Sentral commercial and transport hub in Brickfields.
Khalid said Abdul Rahman made a part payment of RM5 million and on July 19, 1999, wrote an “Acknowledgment of Indebtedness” for the remaining RM10 million which was to be paid in two tranches. But the money was never paid and he later instructed his lawyers to demand back the payment in September 2004.
Khalid is now seeking for the full payment with interest of eight per cent until payment is made and other costs, saying that the five per cent stake belonged to him and no one else as he had worked for the shares by guaranteeing loans given to the company.
However, in his counter-claim, Abdul Rahman said both agreed on a sum of RM10 million for Khalid’s block of shares and he made the first payment on August 1, 1999 with the final payment to be made on July 18, 2000.

Abdul Rahman testified that Daim had instructed him to buy out the MRCB shares. — daimzainuddin.com pic

Abdul Rahman, who was formerly the Malay Chamber of Commerce Penang president, said Tun Daim Zainuddin sometime in 1999 had instructed him to undertake a management buy-out of MRCB by purchasing the 7,101,001 ordinary shares in Realmild. He said the exercise was done in a few days, adding there was no formal sales and purchase agreement for Khalid’s stake. In his witness statement which has yet to be tendered in court, Abdul Rahman said he was summoned to meet Dr Mahathir, the then prime minister, and Tan Sri Nor Mohamad Yakcop, sometime at the end of 2001 and was told to transfer all of the 7,101,001 Realmild shares under his name to Datuk Seri Syed Anwar Jamlullail, who is brother to the Perlis ruler.
“I was told by Dr Mahathir that the 7,101,001 Realmild shares belonged to Umno. I was extremely shocked as I never at any time knew that Umno was the true owner of the shares. As far as I was concerned, I undertook the acquisition of Realmild shares purely from a corporate and commercial standpoint. I raised funds for this exercise through my personal financial means without any assistance from any political entity.
“This is the first time that I became aware of this ‘Umno Trust’ on the Realmild shares,” he said in his witness statement made available to The Malaysian Insider.
Abdul Rahman said he then met Khalid and queried him about the Umno ownership or “Umno Trust” over the Realmild shares, which the latter confirmed as true.
“He, however, took the position that the Umno ownership did not apply to the 355,050 shares he sold me.
“I refused to accept this as I was given very clear instructions from Dr Mahathir to transfer all of the 7,101,001 Realmild shares away,” he said, adding he later transferred the shares to Syed Anwar.
Abdul Rahman also said he asked Dr Mahathir about the RM40 million he paid for the shares, saying “Therefore, he said no payment will be made to me because the shares always belonged to Umno.” He also said Nor Mohamad also told him that the shares belonged to Umno and he would not be paid after transferring the shares.
He denied that Khalid is entitled to any claim from him as the ownership of the shares had been misrepresented.
“These shares had never belonged to him.
“I verily believe that the Plaintiff knew all along that the real owner of the shares was Umno and that these shares could be directed to be transferred to any third party at any time based on instructions from Umno leaders,” he added.
Another witness, Ahmad Nazri, said in his witness statement that he held the majority share of 80 per cent in Realmild although 70 per cent of his shares were actually in trust.
“I was holding in trust for person by (name of) Datuk Dr Mahathir Mohamad,” he was quoted as saying in the document made available to The Malaysian Insider.
Ahmad, who headed Berita Harian until 1999, said there was also a trust deed to back his testimony.
“Yes, the trust was prepared by legal firm Amin & Company. One copy of trust [was given] to Datuk Seri Dr Mahathir Mohamad, another to Datuk Seri Anwar Ibrahim and I keep one copy which I passed to Datuk Kadir Jasin somewhere in 1999 when I transferred 70 per cent share to Datuk Kadir Jasin as he knows of the trust,” he said.
Ahmad Nazri said he paid for the shareholdings of the other three people and had told Khalid about the arrangement over the shares.
He also said the Realmild shares held by the directors were personal and owned by them, adding 10 per cent of the shares was also his own shareholding.
He added that he was told by Daim to relinquish his shares in Realmild in July 1999.
“My 70 per cent which I hold under trust for Datuk Seri Dr Mahathir was transferred to Datuk Kadir Jasin and my personal 10 per cent was transferred to Datuk Abdul Rahman Maidin... a good friend of mine and I told him the witness is our God,” he said.
Ahmad Nazri said there was no price mentioned for his personal Realmild shares but they both agreed that if Abdul Rahman did well in business, he would consider some payment.
He also said that he did not tell Khalid to sell his shares to Abdul Rahman.

MI

Dr Mahathir's Transgressions Unreported

The only mistake that Dr. Mahathir has ever done, as openly acknowledged by the Tun himself, is to repeatedly appoint "wrong" Deputy Prime Ministers for the country (Musa, Ghafar Baba, Anwar and Badawi, and Najib). 
By Ken
Tun Dr. Mahathir has, of late, become even more vocal in pitting the Malays against the non-Malays, in particular the Chinese.
The consequences are that blogs and Internet sites are full of slander and insults targeted at Dr. Mahathir. The insults and name-calling range from "corrupt evil dictator" and "pariah" to "Mahafiruan", "Hitler" and worse [too horrible to be quoted here].
What these bloggers seem to overlook is that Dr. Mahathir was elected by the voters in Kubang Pasu in at least 6 general elections, elected by UMNO delegates to be their president for more than 2 decades and was Malaysia's Prime Minister for 22 years, strongly supported by the majority of the non-Malays. During his tenure, Mahathir was more popular with the Chinese than the Malays and was even saved by them in the 1999 General Elections when the Malays abandoned him because of how he had treated (sodomized?) Anwar, contrary to "adat-adat  orang Melayu".
Mahathir was then admired by many of the same people who are now insulting and criticizing him. They had noted Mahathir's many accomplishments and felt proud about these Malaysia Boleh records - Petronas Twin Towers, KL Tower, KLIA, North-South Highway, Putrajaya, Cyberjaya, MSC, Penang Bridge, Proton, Sepang F1, Bakun Dam, world class golf courses and resorts, etc.
They were proud at having found a leader who had changed Malaysia from an agricultural country into an industrial nation which was doing so well that it needed to bring in foreign labour from Indonesia, Bangladesh, etc. to man the factories, service industries and remaining plantations.
During his tenure as PM, Dr. Mahathir was highly regarded and there were few who would dare to throw even minor insults at him. Not even Karpal would dare to utter a harsh word against the great Dr. Mahathir. 
Today, we are witnessing this same great Dr. Mahathir being called the most evil thing that has happened to Malaysia. However, while the slander and insults continue to increase on the Internet, they are not backed by solid evidence.
Has anyone ever come out in the open with evidence and said "Dr. Mahathir did this and that ...."? Even Anwar, who was Mahathir's deputy for many years and would have been privy to many things, has revealed nothing to expose Mahathir. There are people who claim that Mahathir is corrupt and has amassed wealth. OK, where is the evidence? If you have the evidence, why haven't you reported Mahathir to the police? "Mahathir is a racist", some proclaim loudly, pointing out incidences such as Dr. Mahathir's recent call to Malays to go on the offensive in response to grouses and complaints by non-Malays about their rights. Why has there been no police report and follow-up action against Dr. Mahathir for uttering the racist statements?
If Mahathir is so evil and corrupt, as the bloggers and others claim, why has there been no police or MACC investigation? Surely, Tun Dr. Mahathir is not above the law, as the Tun himself will be ready to openly announce. Some might argue that the police, MACC and AG will not investigate Mahathir because of allegiance or loyalty. But Dr. Mahathir is not the current PM and does not wield power and influence over them. The police, MACC and AG report to Najib, who has also been criticized by Mahathir on various matters, and who would, if he could, surely mobilize the police/MACC/AG to investigate the ex-PM to counter his severe insults and criticisms.
This has not happened possibly because there is no evidence to charge Dr. Mahathir. The only mistake that Dr. Mahathir has ever done, as openly acknowledged by the Tun himself, is to repeatedly appoint "wrong" Deputy Prime Ministers for the country (Musa, Ghafar Baba, Anwar and Badawi, and Najib).
Some might argue that little can be done if the authorities (police, MACC and AG) do not want to act against Dr. Mahathir. The point is that the authorities can act only if there are reports against Dr. Mahathir. Some may point to the rare police reports against Mahathir, such as the one by Karpal Singh, and that nothing has happened. Perhaps there is no evidence for the authorities to proceed further. Or maybe Karpal does not have the necessary evidence to pursue it further (or maybe Karpal is too scared to face Dr. Mahathir or his formidable counsel Mathias Chang in court, and has conveniently forgotten his report against Mahathir).
OK, the Royal Commission of Inquiry into the Lingam video clip provides evidence to incriminate Mahathir (together with Lingam and the others) in the manipulation of the judiciary. Najib (and the AG) has decided to ignore the findings and recommendations of the RCI for reasons which are known to all but the naive. But the critics of Mahathir can surely do something on the basis of the RCI recommendations. Have a massive signature campaign to request His Majesty to direct Najib to act on the findings of His Majesty's RCI's findings. There can be a mass demo to call for action on the basis of the RCI recommendations. Or, at least, why not make police reports on the basis of the RCI findings for action to be taken against Mahathir and his Lingam gang.
Mahathir has made some totally outlandish racist statements of late. Make a thousand police reports against Mahathir. Make it a million - there must be more than a million Mahathir critics out there. Surely the authorities can't ignore a million police reports against Mahathir, and, even if they ignore, that itself would be a world record (another Malaysia Boleh world record we can be proud of) which will hit headlines internationally and force Najib to do something. The fact is that there are few police reports against Dr. Mahathir, though one would think otherwise when reading the many slanderous  and abusive postings on blogs and web sites.
Some people might contend that it would be futile to go to the police or the MACC, arguing that it would be a waste of time and that nothing would happen. Looking at the track record of the police and MACC, one would be justified to conclude that this route would be futile, but there are other routes such as a civil suit. If one has a legitimate case against another, one can bring a civil suit against the other. But there has hardly been any civil suits against Dr. Mahathir. Even Anwar withdrew his civil suit against Dr. Mahathir for his 'Black Eye' though Mahathir was the Home Minister then and claimed that Anwar could have punched himself to get the black eye. 
To conclude, if Dr. Mahathir is really as corrupt, racist and evil as he is made out to be, the critics and  bloggers should (collectively, or individually) file a police report against the ex-PM with solid evidence. If this route does not look viable, they could file a civil suit against Dr. Mahathir and seek damages for all Malaysians - according to Barry Wain, at least Ringgit 100 billion have been misappropriated or lost due to Dr. Mahathir.
If Dr. Mahathir is really the terrible corrupt evil racist he is made out to be, it is ok to be a "coward" to sue him. Given that there is a large number of bloggers who are critical of Dr. Mahathir, they should have no difficulty raising the necessary funds for the civil suit and engaging top lawyers (Karpal - pro-bono?) to handle the case.
File the suit in Malaysia, UK or anwhere feasible (except, of course, Singapore). If both these efforts fail, the bloggers should compile a book, in English and Malay, on Dr. Mahathir to expose his "corruption, racism, and evilness" by providing full details and evidence.
Barry Wain has already made a sterling start in this direction with his must-read "Malaysian Maverick". Why not get someone to translate the book into Malay so that the kampong folks and other Malays can read Barry's work and judge for themselves whether Dr. Mahathir is really the great clean incorruptible champion of the Malays as he now potrays himself?
If Mahathir's opponents and critics are not ready to act in legitimate ways to expose and punish Mahathir for his purported corruption, racism and evilness, the bloggers and other critics of Mahathir should cease from slandering and insulting the Tun and accept him as Allah's blessing rather than a perennial curse on Malaysia.
MT

The Godfather of Sarawak

Unmasked! Taib The Godfather

Monday, August 9th, 2010 GMT

Held in trust by private agreement - 50% of the shares of Sakti International, worth approximately US$ 40 million.

Sarawak Report has uncovered devastating documents which prove that Abdul Taib Mahmud, Sarawak’s Chief Minister, is the real owner of millions of dollars of property assets held in the name of family members abroad.
The damning discovery lays bare a system of private deals, which enabled the Chief Minister to conceal his true ownership of the properties. This was presumably in order to hide the extent of his enormous wealth, for which he has yet to provide any legitimate explanation.
Under the system, whilst it is Taib’s relatives who are publicly registered as the official shareholders and directors of the companies owning the properties,  a separate, private agreement ensures that the shares are actually held in trust for him.
Download PDF.

Documentary evidence of elaborate concealment

260 California Street, San Francisco - Bijou Sakti Office Block

Among documents in its possession Sarawak Report has a copy of one such private agreement (see above) relating to the shares in Sakti International, a company that owns buildings in San Francisco.  Sakti is part of a web of companies started in North America by the Taibs, which includes Sakto, a major Ottawa property company, and Wallysons, which owns the Abraham Lincoln Building in Seattle, housing a top secret anti-terrorist facility for the FBI.
The five official shareholders of Sakti International, which is registered in California, are Taib’s brothers, Onn Mahmud and Arip Mahmud, along with three of his children, Sulaiman Taib, Mahmud Taib and Jamilah Taib.   However, as the document which we have obtained shows, a resolution made soon after the formation of the company has privately ruled that half those shares (a commanding majority) are held in trust for the Chief Minister.  The value of these shares amounts to 40 million US dollars for Sakti alone, according to the company’s own documents.

Tip of the iceberg?

However, Sakti International, estimated to be worth US $80 million, accounts for just a small proportion of the Taib family wealth. Our previous exposes have revealed a vast portfolio of further international property assets, which are owned by members of Taib Mahmud’s immediate family.  For example, Taib’s own children are the shareholders and directors of numerous companies controlling residential and commercial buildings in Canada, Australia, Britain and the United States together worth hundreds of millions of US dollars.  Yet, suspiciously, many of these assets came into their possession when they were in their early 20s and still college students with no visible access to legitimate resources to invest. The inevitable question for Taib Mahmud, therefore, is whether, as in the case of Sakti International, they are also secretly holding these other properties in trust for him?  If not, what explanation can there be for these investments?

Golden Wedding Couple - The Godfather and his family

A number of reports have already been made to the Malaysian Anti Corruption Commission (MACC) regarding the recent disclosures of the Taib family wealth. These new revelations proving the direct link to the Chief Minister will increase the pressure on the MACC to respond with a proper investigation.

Further Fingerprints

The Sakti International documents in our possession, released as part of the disclosure in a recent court case, provide further extensive evidence of Taib Mahmud’s involvement in the company, despite his denials of any business connections.  Indeed one of the company’s earliest official documents, signed in 1987, even lists him as one of the Directors of Sakti International.

Chief Minister's name in black and white, listed as a Director Of Sakti International

The document in question is a Domestic Stock Corporation Statement for Sakti International, which is required annually by the State of California.  In 1987, the year the company was set up, its inaugural statement clearly registers Taib Mahmud, along with his brothers Onn Mahmud and Arip Mahmud, as a Director of the company.  The only officer of the company is listed as Mahmud Taib, the Chief Minister’s eldest son.
It is well-known that in subsequent Taib family enterprises the Chief Minister has always scrupulously avoided including his own name in any documentation.  This early mistake will undermine his constant claims that, in keeping with his role as Chief Minister, he has no direct business interests. It is clear that he in fact set up Sakti International, using the address of his own house in San Francisco. Download PDF

Cover Up

Subsequently, records show that the structure of the company was altered to make Onn, Arip and Mahmud Taib the three Directors, while Rahman became the only officer of the company.  But, as we are now able to exclusively report, Taib Mahmud secretly retained his control through a resolution by the company directors dated April 8^th 1988. This resolution (see top) placed 500 of the 1,000 shares issued by the company in trust for him.

43 Presidio, Taib's San Francisco town house and early HQ for Sakti International

The Godfather

The Sakti documents give a fascinating insight into the manipulative methods used by Taib Mahmud to control his family members, who are supposedly the earners and ‘businessmen’ who have generated the Taibs’ legendary wealth.  The five relatives who were selected to own shares in Sakti International were each been given a different number of shares. Each then surrendered differing proportions of these shares to be held in trust for the Chief Minister.
Brother Onn Mahmud gets 400 shares, but of them 200 are held for the Chief Minister, whereas brother Arip gets just 200 shares, 100 of which are in trust for Taib. Mahmud Taib has the same arrangement ast Arip. However younger brother, Sulaiman Rahman Taib, who was later made sole Director of Sakti, only gets 100 shares under the agreement and they are all in fact held in trust for his father. Daughter Jamilah also only gets 100 shares, but she gets to hold them all herself.
The system ensures that Taib Mahmud has half of all the shares held in trust for himself, whereas  none of the others hold more than 200 shares. In this way he clearly keeps a commanding control over the company he pretends not to own.

Classic Car on Standby - Vintage Ferrari kept ready for Chief Minister's occasional visits to 43 Presidio Avenue. Son Rahman Taib, who shared his father's interest requested a 4,000 square foot garage to house his car collection in the States

Taib in charge

Former employees of Sakti have testified to the controling position the Chief Minister holds over the other members of the family.  Rahman, as he was known in the States, was still in college when he became sole Director of Sakti and has been described as being in awe of his father, whom he once had to wait a week to get a meeting with.
“We always considered Taib to be the ultimate boss and decision-maker” one former executive has told Sarawak Report, “It was obvious that he was the source of the money and Rahman was extremely deferential towards him”.

Where did the money come from?

The Chief Minister has so far made no comment on the string of recent exposes regarding his wealth.  However, this new evidence will increase the widespread demands for him to explain how he and his family accrued the millions necessary to acquire such investments.  Taib’s personal salary from his numerous concurrent positions still only delivers an official income of just under 50,000 MYR (around US $16,000) a month.

Multi-billionaire? Chief Minister's finances beg immediate scrutiny

In past weeks the existence of Ridgeford Properties in London and Sakto Corporation in Ontario, Canada have also been made public (see previous exposes on Sarawak Report).  These companies own and manage numerous office blocks worth hundreds of millions of dollars.  Ostensibly the Directors and owners of these concerns are Jamilah Taib and her husband Sean (Hisham) Murray, a Canadian national. However, like Sakti,  Sakto was originally set up under the names of Taib family members, not Mr Murray.
Although numerous members of Sean Murray’s family now work for Sakto, all the evidence indicates that these are in fact Taib family businesses, ultimately controlled by the Chief Minister of Sarawak.
Surely the weight of evidence is now such that the Malaysian Anti-Corruption Commission will be unable to ignore the deluge of demands requiring thorough investigation into Sarawak’s White Haired Raja?
Sarawak Report

Bloggers in the Red

By TEO CHENG WEE, The Straits Times
Online journalism may be booming in Malaysia, drawing many readers from traditional print media, but staying profitable is another story altogether.
With intense competition and business models that are still being worked out, many popular news sites are still struggling to stay in the black.
Recently, one of Malaysia's top news websites became the first major casualty.
The Nut Graph, which was launched with much fanfare in 2008, has said it is scaling down operations at the end of this month and retrenching staff. Making an announcement last month, editor Jacqueline Ann Surin cited financial difficulties to explain its move.
Starting next month, The Nut Graph will publish only once a week instead of five times, and focus mostly on columns and commentaries from contributors, rather than news or features.
The Nut Graph's financial struggles have been no secret. Launched with a start-up cost of RM2 million, the website has not turned in a profit, and with funds running low, even had to seek public donations to keep going.
"The expectation of online journalism is that it needs to be super-fast with a high turnover of stories. In order to do that, you need a fairly large team which costs more money," said Surin, a former journalist with local dailies The Star and The Sun.
The Nut Graph business model, she said, was simply not sustainable.
A similar story can be heard at some of the other news websites.
Top news website Malaysiakini, for instance, is the oldest and only website that charges subscription. Even then, the 10-year-old site is making only a small profit, said its editor Steven Gan.
Similarly, the chief executive of The Malaysian Insider, another well-read site, said earlier this week that it was still in the red. Internet advertising, he said, covers only half its costs.
Still, such financial challenges have not stopped newcomers like Malaysian Mirror, Free Malaysia Today and Malaysian Digest from joining the fray in the past year.
News websites have surged in popularity here in the past two years, in the wake of the 2008 general election, as Malaysians flocked online for what they felt was more independent news, at the same time shunning mainstream newspapers which many felt were overly pro-government.
But analysts say that in an increasingly crowded cyberspace, packed with stories of varying quality, more has not proven to be better.
Political analyst Farish Noor noted that there has been a tendency for news websites to overlap and cover the same news, resulting in a 'somewhat shallow consensus of opinion'.
There is also frequent speculation that some websites have hidden political backers, which would explain the ability to absorb financial losses in exchange for online influence.
"After the last general election, people realized that the Internet is a powerful medium. It is possible that politicians and business tycoons will pay for a stake in online media," Gan said.
While some of these news websites have sometimes been criticized for running stories with clear slants, he felt it was up to readers 'to decide how much weight they can put on them and what to believe in'.
Both Gan and Farish see the scaling down of The Nut Graph, which has built up a credible reputation, as a blow to online journalism in Malaysia.
More websites are likely to come up to take its place, but Farish believes that those with agendas will not be able to hoodwink readers for long.
"The public can see through any slant, and that only robs these organizations, and the journalists who work for them, of their credibility," he said.