Shocking! MACC officers posed as TNB meter readers were paid in bribes as string cripples Bitcoin syndicates

Sting operation on bitcoin-mining power theft racket nets 18 suspects

Eighteen people have been arrested in relation to the bitcoin mining syndicate busted by a joint sting operation involving Tenaga Nasional Bhd (TNB) and the Malaysian Anti-Corruption Commission (MACC).

MACC stings bitcoin miners

Open sesame A fireman breaking open a reinforced door at one of the Bitcoin mining centres. The raiding team had to break two more such doors before they could enter the premises.
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Electricity stealing spree comes to an end as Macc finally takes action

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In the three years that MACC officers posed as TNB meter readers, they were paid a whopping Rm2.4mil in bribes. The Bitcoin mining syndicates were raking in much more – about Rm50mil a month – but this is about to end soon. JAYA: It was a sting operation that began three years ago during which time MACC officers disguised as TNB meter readers were paid Rm2.4mil in bribes.
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Some were even offered Bitcoin – a first for graft busters – to turn a blind eye to the power theft by mining syndicates.
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The masterminds could afford this. They were raking in a whopping Rm50mil a month from their 1,000-odd premises nationwide.
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Yesterday, the anti-corruption officers crippled much of their activities by conducting simultaneous raids in Malacca, Negeri Sembilan, Kedah, Penang, Kuala Lumpur and Selangor. But it wasn’t easy.
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“It took us an hour to break open two doors at each premises,” a source close to the investigation revealed.
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“And then, there were three more vault-like doors to cut through before we could enter one of the premises,” the source said.
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“We had to seek the help of the Fire and Rescue Services.”
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Dozens of suspects were arrested, including the heads of the syndicates. More than 200 Bitcoin mining machines were also seized in yesterday’s raids that involved dozens of Tenaga Nasional officers.
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“Some 350 MACC officers were involved in the probe,” said the source.
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While it is not illegal to mine Bitcoin, power theft is.
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This is done because running such an operation requires dozens of computer servers that would be in operation around the clock.
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“This would require huge amounts of electricity,” said the source.
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“The amount of electricity stolen at each premises could amount to RM40,000 per month,” added the source, saying that the syndicates earned around RM50,000 from every premises.
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“If they had paid their electricity bills, they could still make a profit because most of them own dozens of premises each,” the source explained.
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“But, greed got the better of them.”
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Bitcoin mining uses sophisticated computer software to try to solve complex mathematical problems to unlock a “key” that will enable a new Bitcoin to be produced.
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The Bitcoin market is highly volatile. Its value fluctuated from RM160,000 to RM277,000 in a month.
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A MACC spokesman confirmed yesterday’s raids.
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Yesterday, The Star reported that Bitcoin mining operators were reaping in millions at the expense of the public.
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Local communities, including hospitals, that shared the same power source as the mining premises, were being deprived of supply.
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Some buildings located near the Bitcoin mining premises experienced power outages often, with some burning to the ground.
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It is understood that the graft busters began the sting operation following a sharp increase in losses incurred by the country due to electricity theft.
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“Each premises owns around 80 to 120 Bitcoin machines.
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“They bring in these machines from China via Port Klang. They declare it as computer equipment,” the source said.
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Investigations are being conducted under Sections 16 (b) and 17 (b) of the MACC Act 2009 and if convicted, the guilty face a maximum imprisonment of 20 years and can be fined not less than five times the value of the bribe or RM10,000, whichever is higher.
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On Jan 24, Energy and Natural Resources Minister Datuk Seri Takiyuddin Hassan said the country lost more than Rm2.3bil in bitcoin mining activities – an increase of 400% over the past four years.
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By ALIZA SHAH alizashah@thestar.com.my

 

Busting bitcoin bribers

 

On the watch: A TNB officer checking on a bitcoin mining premises.

 `MACC zeros in on miners who pay meter readers to look the other way

PETALING JAYA: Bitcoin mining operators running their operations on stolen electricity and bribing electricity meter readers to help them hide their actions will soon have to pay the piper.
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The Malaysian Anti-corruption Commission (MACC) is zooming in on them and their crime which is causing financial losses in the billions of ringgit.
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“Graft-busters have been looking at dozens of such operators and they are expected to make their move anytime now,” revealed sources with knowledge of the investigation.
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It is learnt that these operators, who have branched out to every state in Malaysia, are even willing to pay up to a quarter million ringgit as bribes to meter readers to look the other way and give them a miss.
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While it is not against the law to mine bitcoin, running such operations requires dozens of computer servers working on a 24-hour basis, which requires huge amounts of electricity.
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Many are not paying their dues and are instead stealing electricity by illegally tapping into power sources or tampering with the meter.
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In an interview with The Star, sources said that in addition to cash, these syndicates even offered bitcoin, or cryptocurrency, as bribes.
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The authorities, they added, kickstarted their on-ground investigation a few years ago following the sharp increase of losses incurred by the country due to electricity theft by bitcoin miners.
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It is understood that the investigations are currently being conducted under Sections 16 (b) and 17 (b) of the MACC Act 2009, which stipulates that giving or offering bribes is equal to the offence of accepting bribes.
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If convicted, the person faces maximum imprisonment of 20 years and can be fined not less than five times the value of the bribe or RM10,000, whichever is higher.
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However, enforcers face several challenges in thwarting these illegal activities, especially since these premises are usually as tightly sealed like as a war-time bunker.
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On Jan 24, Energy and Natural Resources Minister Datuk Seri Takiyuddin Hassan said the country had lost more than Rm2.3bil in bitcoin mining activities – an increase of 400% over the past four years.
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The number of cases has also drastically increased year-on-year.
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In 2018, there were 610 cases while there were 1,043 cases in 2019, 2,465 cases in 2020 and 3,091 cases in 2021, totalling 7,209 cases.
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By ALIZA SHAH alizashah@thestar.com.my

 

Syndicate’s greed ravaging local communities 

 

Fire hazard: The energy intensive mining activities of bitcoin machines that run 24/7, can lead to power outages, damage to electrical appliances and worse – potential fires. — Photo courtesy of TNB

PETALING JAYA: Bitcoin mining operators running on stolen electricity are reaping in millions at the expense of the public.
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Sources said the syndicates behind the operations were depriving the local communities – including critical sectors such as hospitals which shared the same power source – of their supply.
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The energy intensive mining activities of bitcoin machines that run 24/7, can lead to power outages, damage to electrical appliances and worse – potential fires.
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“Each premises is loaded with mining machines and the operators rely on air conditioning to help cool the equipment.
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“So, their electricity bills can go up to RM40,000 per month for each premises but their profit is just slightly above the amount.

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CLICK TO ENLARGECLICK TO ENLARGE

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“That is why they have no choice but to operate using illegal sources (of electricity),” the sources told The Star.
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The Star learnt that some buildings located near these bitcoin mining premises had experienced power outages, with some even burning to the ground.
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“These bitcoin mining premises often use fuses that do not adhere to safety standards and load, exceeding the capacity of the cables. So, unfortunately for their ‘neighbours’, when the fire breaks out, they are also affected.
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“There were instances where reports were lodged over power outages at dialysis centres and clinics and upon investigation, authorities found that these were due to bitcoin mining premises illegally tapping into the power,” said the sources.
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It is understood that some of these bitcoin mining operators own hundreds of premises.
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“Bitcoin mining” is a process of using sophisticated computer software to try to solve complex mathematical problems to unlock a “key” to produce a new bitcoin.
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The first bitcoin miner to solve the puzzle is rewarded with a bitcoin.
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Only one miner can add a new block to the blockchain every 10 minutes by solving the puzzle and to maintain a competitive advantage, many operators would scale up or upgrade their equipment to run round the clock.
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A study in the United States suggested that a single bitcoin transaction required 2209.41 kilowatt per hour (kWh), which was equivalent to 75.73 days’ worth of power consumed by an average household in the country.
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The bitcoin market is highly volatile, with its value having fluctuated from more than RM277,000 in October to over RM160,000 this month.

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MACC stings bitcoin miner

 

Tools of the trade: (From left) energy commission ceo abdul razib dawood, azam and Baharin looking at the seized computer hardware at the Macc headquarters in Putrajaya.

 

18 nabbed and rm4.5mil frozen after three-year Op Power

The masterminds behind a multimillion ringgit bitcoin mining syndicate are among 18 individuals arrested by the Malaysian Anti-corruption Commission (MACC), following a threeyear sting operation codenamed Op Power.

MACC chief commissioner Tan Sri Azam Baki said the 18 individuals arrested are all Malaysian males aged between 30 and 60.

“We confiscated 1,157 bitcoin (mining) machines worth Rm2.3mil in total.

“A total of Rm4.5mil was frozen from bank accounts linked to 94 individuals and 29 companies.

“The MACC also seized RM281,180 in cash, RM82,000 in ewallet balances and some US$25,893.46 worth of cryptocurrencies.

“Five vehicles, including a BMW, Toyota Vellfire and an Audi, have also been seized,” said Azam at a press conference at the MACC headquarters here.

Azam added that the MACC is looking to arrest another five individuals with links to the case, but this has been put on hold as the suspects have currently tested Covid-19 positive.

The Star on Sunday and Monday reported on a sting operation that began three years ago during which MACC officers posing as TNB meter readers were paid Rm2.4mil in bribes.

Azam said the syndicate operators offered between RM3,000 and RM300,000 to TNB officers to help cover up their operations.

The syndicate was found to have used special devices to manipulate power usage to ensure that their operations used as little electricity as possible.

Azam said that while cryptocurrency mining is not illegal, power theft is a crime.

TNB chief executive officer Datuk Baharin Din, who was also present at the press conference, said the syndicate used sophisticated methods for their illicit operations.

“The quantum of the power volume that this syndicate has stolen is very large, and it was done continuously for 24 hours and 365 days. This went on for over three years.

“The technique the syndicate used to tamper with the power usage is quite sophisticated.

“You come across small households that try to steal power, but these people go way beyond that.

“To do what they did, you have to be very competent.

“So we are very thankful to the MACC for their big help in this operation and because of them, we managed to stop this syndicate,” said Baharin.

 By JOSEPH KAOS Jr joekaosjr@thestar.com.my

 

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Corruption & incompetence as a result of corrupt policies that breed corruptions & incpmpetency as Malaysia fails in graft index?

State of GLCs a matter for concern

A MAJOR topic at the inaugural Malaysian Economic Symposium held on July 26 at the Parliament Complex was government-linked companies (GLCs). The big issues about GLCs are not only their large presence in the economy but also their governance.

As mentioned in the symposium, which was jointly organised by the Office of the Speaker of the Dewan Rakyat, the Backbenchers Council and the Parliamentary Caucus on Reform and Governance to get a deeper understanding of the challenges facing the economy, there are so many GLCs that nobody knows what the total number is. The other concern is their lack of transparency and accountability.

About 15 years ago, the then prime minister launched the GLC Transformation Programme to raise the standards of corporate governance in government-linked companies following the guidelines issued by the Securities Commission and Bank Negara Malaysia, as part of the reforms to make the economy more resilient to external shocks.

The New Economic Model report to the National Economic Action Council also stressed the need to reform GLCs so that they do not affect adversely the efficiency and competitiveness of the economy and become an obstacle towards making Malaysia a fully developed high income country.

Khazanah Nasional, Employees Provident Fund (EPF) and Permodalan Nasional Berhad (PNB) adopted these guidelines to strengthen their internal checks and balance and make their major GLCs more attractive to local and foreign investors. Good governance in the companies owned by these three national institutions is important as their shareholdings in the corporate sector account for a big share of the market capitalisation.

Further, as the country’s national wealth fund, Khazanah realised its responsibility as an MoF (Ministry of Finance) Inc corporation to set the tone for good governance.

EPF and PNB are responsible for paying good dividends to millions of their subscribers. Like Khazanah, they too insist on their investee companies to adopt good governance practices so that when they do well in the market place, the benefits will go to their subscribers.

One of the important guidelines in good corporate governance is that the board of directors should be evaluated on the “fit and proper“ criteria before they are appointed. One major requirement in the criteria is that the nominee for board appointment should not be politically connected or linked so as to protect the independence of the board from outside interference.

A good board should have the committees on audit, nomination, renumeration and risk management actively checking the management and also providing it with professional advice and recommendations.

The presentation by the university professor at the symposium highlighted the political links of GLCs, with many ministries involved in overseeing them. Thus, the ministries dealing with rural and land development, technology and research, tourism, sports, youth and culture are among the ministries which have GLCs to implement their policies and projects.

Ministerial influence on the GLCs is not always good. The federal GLCs are MoF Inc in ownership but administratively, they answer to the ministers. Often, the GLCs have bumiputra partners who are linked to the top circles or their own relatives in forming joint venture business to provide the privatised services to the ministry. With the political connections, the contract prices that the ministry pays to the GLCs for supplying the work orders or purchases may well be above the market price. The GLCs are thus operating at the expense of taxpayers.

Some politicians use GLCs and trustee foundations under religious authorities to promote their political activities under the guise of CSR (corporate social responsibility), like sending pilgrims to Mekah, sponsoring religious events, building surau or paying for goodwill golf trips overseas, including their wives’ travel costs.

States also have their GLCs established as Mentri Besar Inc companies or as subsidiaries of statutory bodies like state economic development corporations (SEDC) and state agricultural development corporations. Many of these GLCs have joint ventures with bumiputra partners who are politically linked. Malay property developers have raised issues over the SEDCs which build shop lots and commercial buildings at lower cost because they get priority access to state land and often at lower than market price, thus undercutting the genuine Malay private sector.

The Pakatan Harapan government has pledged that the appointments to GLCs will be non-political in the sense that politically active persons will not be appointed as directors of the companies. The government wants to bring professionals to serve on the GLC boards to improve their performance. The definition “non- political“ should include persons holding any kind of party positions because those at the lower levels can be just as ambitious in using the GLCs for gaining influence among the top leaders.

Some professionals have left active politics but remain advisers to a political party or are business associates with high-ranking politicians or are married into powerful political families. It's not clear whether such professionals can be considered as independent or free from politics.

A good board should respect the views of its committees on nomination, remuneration, audit and risk management. These committees are mandatory for listed companies and banks as the Securities Commission and Bank Negara are very strict about good corporate governance to provide the internal checks and balance to prevent the board from making wrong decisions or from being influenced by the chairman’s personal or political interests.

The government should make it compulsory for all GLCs to be similarly regulated, especially those under the control of state governments and statutory bodies as they are highly politicised.

Business associations have always complained in every dialogue with the government that the GLC sector is too large and is crowding out the private sector. As growth is fundamental so that more wealth can be created in the economy to generate the resources for the government to spend on the poor, it should consider reducing the size of the GLC sector so as to strengthen the investment climate and provide more room for the private sector to expand locally. Those GLCs that are a financial burden to taxpayers should be closed down or sold off before they cause a financial crisis to the country.

Tan Sri Mohd Sheriff Mohd Kassm Kuala Lumpur


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TNB blames technical glitch! Explain discrepanccies in bills, TNB told

TNB blames technical glitch! Explain discrepanccies in bills, TNB told

Negligence, Technial among TNB faults

 

TNB will still be fined, even after remedying high electricity charges

 

TNB to re-credit those overcharged

It’s not cool to waste electricity

Time to Change way we use appliances

https://youtu.be/Bd9mNswv5ZI

https://youtu.be/7N_y3O3LHYI
https://youtu.be/P9IF-t45mYE

PETALING JAYA: Cooling homes and offices is big business due to Malaysia’s year-round hot and humid equatorial climate.

But changing a few simple habits can save consumers’ money and will be better for the environment, says Malaysian eco-activist Gurmit Singh.

“Research has shown in typical urban households in Malaysia, the highest electricity consumption goes to the air conditioner, followed by the fridge and water heater.

“If we tackle these three pieces of electrical appliances, we will be able to save a fair bit of electricity usage,” he said.

The chairman and founding executive director of Centre for Environment, Technology and Development Malaysia (Cetdem) said many do not realise the temperature need not be set too cold.

“The same goes for offices. It is a waste of electricity by setting the temperature so low.

“Some hotels and offices are so cold that people have to dress as if they are in winter.

“Every degree we raise we are saving 10% of electricity consumption. If we raise five degrees, then we save at least 50% of the consumption.

“I think there is a lot of potential to reduce electricity consumption by increasing the thermostat or temperature setting of our air conditioner,” he said, adding that another simple rule of thumb is to switch off any electric appliances when not in use.

Gurmit, however, noted that in general, Malaysians care very little when it comes to saving energy.

“The problem with Malaysians is that we are so used to cheap electricity that many just couldn’t care less about electricity.

“Many tend to think they have enough money that they can afford to use as much electricity as they want.

“Such mindset has been like that for many years. They only hurt when their electricity bills surged suddenly,” he added.

Gurmit was referring to the case of consumers complaining of an unusual increase in their utility bills, which Tenaga Nasional acknowledged was a technical glitch in the system. (see related post below)

Pointing out that Malaysia’s electricity consumption is rather high, Gurmit noted the fact that the generation of electricity also contributes to the emission of greenhouse gases must not be omitted.

“Our per capita greenhouse gas emission is one of the highest in our region – we are probably only second to Singapore and similar to some European countries.

“It clearly shows that we use a lot of energy unnecessarily, not only in the electricity sector,” he said, adding that Malaysians must move away from that practice.

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TNB blames technical glitch! Explain discrepanccies in bills, TNB told

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TNB will still be fined, even after remedying high electricity charges

Yeo said the high electricity bills problem was in most cases due to TNB’s technical problem in billing the customers. — Picture by Saw S..

TNB blames technical glitch! Explain discrepanccies in bills, TNB told

https://www.thestar.com.my/news/nation/2019/06/01/tnb-blames-technical-glitch/?jwsource=cl

https://youtu.be/M-Vm6k1Xud4

TNB to investigate complaints, urges consumers to lodge reports ...

KUALA LUMPUR: Tenaga Nasional Bhd (TNB) has admitted that a recent technical glitch is among the reasons for the sudden surge in utility bills.

TNB president and chief executive officer Amir Hamzah Azizan, who held a press conference yesterday, was apologetic and promised to investigate and resolve the issue as soon as possible.

Amir said the technical glitch between May 15 and May 20 caused a slight disruption to the system but it had since been resolved.

“Between May 15 and May 20, the system has been operationalised in stages so we can ensure we can (provide) service to the customers as fast as we can.

“By May 20, everything was back in operation. Some customers may have been billed for extra days (causing a hike in the bill),” he told the media.

Amir urged consumers to lodge a report if they noticed any discre­pancies in their bills.

He vowed that TNB would investigate and address their complaints.

Amir said in April alone, the utility company received 5,621 complaints but this almost doubled to 9,028 in May.

“This brings the total number of complaints to 14,469 reports and from this, 11,331 have been re­solved.

“We would also like to repeat our stand that TNB will keep its promise to investigate the reports.

“If there is evidence that we did overcharge, we will credit the amount back to our customers’ accounts,” Amir said.

He said a special task force, led by TNB’s chief retail officer Megat Jalaluddin Megat Hassan, had been formed to oversee the complaints and resolve the issue.

Megat Jalaluddin said that it usual­ly took about two weeks to credit the amount back to consumers but it could be delayed due to the large number of complaints received.

Amir said other reasons for the sudden surge in electricity bills include old and faulty TNB meters, replacement of new meters and increased usage in the consumer’s household.

He also assured consumers of uninterrupted electricity supply, especially during Hari Raya.

“To those who have lodged reports or ongoing investigations, we assure that the disconnection notice will be postponed for two weeks.

“We would like everyone to have a peaceful Hari Raya celebration,” he said.

Amir said the operation hours of TNB offices would be extended from 8am to 6pm from Monday to Saturday, except for public holidays.

As for the TNB Careline, the hours will be extended from 7am to 11pm every day including public holidays, except for Sunday.

This is to help facilitate complaints from consumers and to help resolve their billing issues as soon as possible.

On comments by Energy, Science, Technology, Environment and Climate Change Minister Yeo Bee Yin that TNB would be fined even after it rectifies the billing problem, Amir said at the moment the utility company would focus on fixing the problem.

“My focus is to resolve this issue, we will talk about other issues later. The consumers are our priority,” he said.

During an interview on 8TV’s Global Watch programme on Thursday, Yeo said the Energy Commission had already given TNB a warning letter and an instruction notice to resolve the problem.

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Explain discrepancies in bills, TNB told

KUALA LUMPUR: Tenaga Nasional Bhd (TNB) should give a concrete explanation for the sudden discre­pancies in electricity bills and take holistic steps instead of just depending on complaints from users, say consumer groups.

Consumers Association of Penang (CAP) education officer N.V. Sub­barao said TNB, as the national utility company, must take responsibility instead of depending on consumers to come forward and lodge reports.

“TNB must do the due diligence. It will be unfair to those especially in the rural areas,” he said.

Federation of Malaysian Consu­mers Associations (Fomca) chief operations officer T. Saravanan said that while TNB wanted users to lodge complaints, the utility company needed to improve its customer service and response time.

He noted that TNB should explain why there was a technical glitch in its system.

“The problem should have been communicated to the public earlier and they should not have waited for the Energy Commission or Energy, Science, Technology, Environment and Climate Change Ministry to intervene,” he said.

He also noted that the Energy Commission should investigate the issue and publish its findings.

“An independent investigation team should be formed so that the findings won’t be biased.

“The Energy Commission should play an important role in protecting consumers,” said Saravanan.

Malaysian Islamic Consumer Association secretary-general Datuk Dr Ma’mor Osman said TNB’s explanation that the sudden increase in electricity bill was due to a technical glitch could not be accepted.

“The public cannot accept this as TNB has all the technology to check silly mistakes.

“TNB makes very high profits and they have monopolised the sector.

“If they do not give a satisfactory explanation, consumers will as­sume that they just want to make more money.

“If they know there is a glitch in the system, they need to inform all consumers.

“There is no point in blaming others for their wrongdoing,” he said.

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