Scottish university's £8m 'donor' faces jail

IT WAS meant to be the biggest donation ever made to a Scottish university, a philanthropic gesture that would signify a new era of partnership between Scotland and Malaysia. Yet two and a half years on, the Malaysian tycoon who pledged £8 million to the University of St Andrews for a new medical school has yet to hand over a penny and is now facing jail in his home country for violating bankruptcy conditions.

• Vinod Sekhar is due in court next month over two alleged offences under the Malaysian Bankruptcy Act

Scotland on Sunday can reveal that Vinod Sekhar, who was dubbed the Richard Branson of South East Asia and named by Forbes as the 16th-richest man in Malaysia in 2007 with a net worth of $350m, has been cited for two offences under the Malaysian Bankruptcy Act, and will appear in court next month to answer allegations that he was a director in 25 companies and left the country without permission while still bankrupt.

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The country's Insolvency Department claims that Sekhar, who owns the Malaysian-based Petra Group, was declared bankrupt for debts totalling 2.4m in June 2005 - two and a half years before he pledged 8m to St Andrews University.

Meanwhile, the new school of medicine at St Andrews has been forced to proceed without Sekhar's funding, and opened its doors to students earlier this month. It says that although it still hopes to receive the donation it now no longer has plans to name the school after Sekhar's late father, as originally agreed.

Scotland on Sunday has also discovered that the British charity Hopes and Homes for Children, to which Sekhar pledged 2.5m in 2008 to help children affected by poverty and conflict in Africa, has not received any money from Sekhar either.

A high-profile friendship with film star Bruce Willis also turned sour in the same year when the Hollywood legend sued Sekhar's company over a $2m investment that he wanted returned.

Sekhar's 8m donation to St Andrews was announced with great fanfare at a press conference in Kuala Lumpur in February 2008 by Sekhar and St Andrews principal Dr Brian Lang, who has since retired. It was also made clear that the school would be named after Sekhar's father, Dr BC Sekhar, who died in 2007 and was known in Malaysia as the father of the natural rubber industry.

The university eventually turned to other donations and funds to complete the state-of-the-art 45m medical and biological sciences building, which will be formally opened next month.

Sekhar, a flamboyant 42-year-old with a taste for Cuban cigars and Mickey Mouse ties, owns Petra Group and Green Rubber, a firm which devulcanises old tyres to remove the sulphur so they can be recycled.He has a well-documented love for Scotland, including a taste for golf and Lagavulin whisky, and is a close friend of Hollywood actor Mel Gibson, star of Braveheart and an investor in Green Rubber.

He first came to global prominence in 2008, the year that Green Rubber was meant to be launched on London's Alternative Investment Market (Aim). The firm has yet to float as planned.

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Sekhar has always courted friends in high places. In December 2008, US president Bill Clinton caused controversy when he accepted a $200,000 fee from Sekhar to speak at an event in Kuala Lumpur and tell an audience of 3,000: "You should be proud of this man."

The incident caused particular embarrassment for Clinton's wife Hillary, who had just been named secretary of state in the new Obama administration. It was the last speech her husband made that wasn't vetted by a US State Department ethics panel.

A former board member of Petra Group later told the New York Times: "I believe (Sekhar] is using Bill Clinton - this is what he does." He added: "He just wants to get new investors."

According to documents in Malaysia an application was filed on 13 August this year by the Malaysian director-general of insolvency seeking Sekhar's imprisonment for contempt of court when he failed to comply with the Bankruptcy Act 1967.

It stated that Sekhar was declared bankrupt by the Kuala Lumpur High Court on 8 June, 2005, for failing to settle his debt to credit company Orix Credit Malaysia Sdn Bhd and 11 other companies totalling around 2.4m.

According to the application, Sekhar committed two offences when he became a director of 25 companies and had left the country without permission of the director-general of insolvency. Sekhar was ordered to be present in court on 26 November to show cause why the committal order against him should not be made.

It is believed that Sekhar left the country without approval in August to travel to the UK to have talks about an investment in Npower Championship side Sheffield United, although the deal has yet to materialise.

Speaking from Malaysia last week, Sekhar declined to comment to Scotland on Sunday, although he offered assurances that he would be able to set the record straight at a later date.He also presented the paper with the chance to travel to Malaysia, "on us, no strings attached", in order to speak to those involved.

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In September, Sekhar's lawyer S Veerapan issued a statement saying: "My client could have responded to the allegations against him, but this would have been sub judice as the matter is now a court case."

A spokesperson for the University of St Andrews said: "We continue to receive assurances from Vinod Sekhar that he will honour the longstanding promises and commitments he has made to the University of St Andrews."

A spokesperson for Hopes and Homes for Children said: "We can confirm that we did have a relationship with Vinod Sekhar, but we did not receive any funding from him."