Bill Clinton Speech in Malaysia Irks Investors

Former President Bill Clinton visited Malaysia on Friday to deliver his first paid speech since his wife, Senator Hillary Rodham Clinton, was selected Monday by President-elect Barack Obama to be secretary of state.

Mr. Clinton spoke before nearly 3,000 people in Kuala Lumpur at the invitation of Vinod Sekhar, a Malaysian businessman whose foundation paid Mr. Clinton $200,000, according to several people with knowledge of the fee. The figure is on the lower end of the scale that Mr. Clinton usually commands for his speeches.

“You should be proud of this man,” Mr. Clinton told the audience, pointing at Mr. Sekhar, the 40-year-old chief executive of the Petra Group, a privately held rubber technology company.

But several angry investors in Britain and Malaysia say they disagree with the former president’s glowing assessment of Mr. Sekhar, whose company has suffered a rough few weeks.

“I believe he is using Bill Clinton — this is what he does,” said Abdul Azim Zabidi, a former board member of the Petra Group who claims Mr. Sekhar broke numerous promises to him and still owes him $100,000. “He just wants to get new investors.”

Another investor, the actor Bruce Willis, recently settled a lawsuit with Petra over the return of $900,000. The company called it a “misunderstanding.”

And this week, after a 10-year partnership, a member of the Malaysian royal family quit as Petra’s chairman, saying he was tired of the many “surprises” during his affiliation with the company.

“Enough is enough,” the former chairman said.

Mr. Sekhar declined to comment. A spokesman for the Petra Group, Andrew Murray-Watson, said that Mr. Zabidi’s assertion that he was still owed money was “utter rubbish,” and that the Clinton event was held as a memorial for Mr. Sekhar’s late father, a scientist who invented an environmentally sound way to recycle tires.

“The idea that Vinod organized this event purely for public relations purposes is frankly ludicrous, and insulting to the memory of his father,” Mr. Murray-Watson said.

Officials with the Obama transition team said they did not vet Mr. Sekhar’s background before Mr. Clinton’s speech. The speech was one of the last Mr. Clinton will deliver without being reviewed by a State Department ethics panel, a requirement he has agreed to follow if Mrs. Clinton is confirmed by the Senate as secretary of state. Mr. Clinton also agreed to have his fees from business dealings and foreign speeches reviewed by the White House Counsel’s Office, if necessary.

When Mrs. Clinton emerged as the leading contender for secretary of state, questions were raised about whether she could work as the nation’s chief diplomat while Mr. Clinton continued to pursue his global business dealings and foreign speechmaking. In a bid to erase worries about conflicts of interest, the former president agreed to every request made by the Obama transition team.

“If she is going to be secretary of state, and I operate globally and I have people who contribute to these efforts globally,” Mr. Clinton told CNN this week, “I think that it’s important to make it totally transparent.”

Since leaving the White House, Mr. Clinton has traveled the world fighting AIDS, malaria and other maladies. Since its formation in 1997, the Clinton Foundation has raised more than $500 million to build a presidential library and finance charitable programs.

This week, he hosted the Clinton Global Initiative Asia meeting in Hong Kong. It will be the last such meeting for some time; under the terms of his agreement with the Obama transition team, Mr. Clinton agreed to no longer host those meetings overseas.

His decision to accept the invitation of Mr. Sekhar, who has made contributions to the Clinton Global Initiative, surprised several Petra Group investors, who say Mr. Sekhar was using his association with Mr. Clinton to attract new investment. It was Mr. Clinton’s first visit to Malaysia.

Barrie Clapham, a British investor who says he put £300,000 into Mr. Sekhar’s company in 2003 and lent him an additional £170,000, now says he blames himself for failing to recognize that Mr. Sekhar is “a man of straw.”

“He’s very flamboyant,” Mr. Clapham said. “People think this guy is a real mover and shaker, and he keeps lending credibility to himself through association with the right people.”

Despite what Mr. Clapham called Mr. Sekhar’s veneer of wealth, he said, “I learned later that the house he lived in was rented.”

“Everything was rented,” Mr. Clapham added.

He says he has been asking Mr. Sekhar for the return of his money since 2003, but has received only £30,000 of the £470,000 he says he is owed. “He told me he was a man of honor, and he would honor it,” Mr. Clapham said. “I have been pressing him ever since.”

Mr. Murray-Watson said that Mr. Clapham had agreed to invest a large sum in the company, but that “as far as the company is concerned, he did not fulfill that obligation.”

“He remains a shareholder,” Mr. Murray-Watson said, “and negotiations are ongoing that the company expects will lead to a satisfactory outcome for all parties.”

This week, Mr. Sekhar’s partner, Tunku Imran Tuanku Ja’afar, the prince from the Negri Sembilan royal household, announced he was ending his decade-long affiliation with Mr. Sekhar by resigning as chairman of the Petra Group and a director of its affiliated companies.

“I have received many surprises during my tenure with the group,” he said in a statement, citing the lawsuit involving Mr. Willis as “just one, and unfortunately the most high profile.”

He said the lawsuit caused “embarrassment to my family, particularly to my royal parents.”

Although Mr. Murray-Watson acknowledged that the company had had a difficult few weeks, he said its future was bright.

“Petra Group companies are trading well in a difficult economic environment,” he said, pointing to “a recently signed, groundbreaking deal with Timberland” to make shoe soles out of recycled materials manufactured by the company.

The Petra Group, he said, “is set for record global growth over the next 12 months.”

Mr. Clinton promoted the Petra Group’s new deal on Friday, telling the audience, “One of the biggest rubber shoes and boots manufacturers, Timberland, is replacing the soles of its shoes it makes with this man’s green rubber technology.”

Mr. Clinton often praises companies that pay him to speak. In 2001, he received $125,000 from an Illinois management consulting company called International Profit Associates. It was later revealed that the Illinois attorney general was investigating accusations of deceptive marketing tactics by the company.

After a start-up Web search site named Accoona donated $700,000 worth of stock to his foundation, Mr. Clinton praised the company at a corporate event in December 2004.

“I hope you all get rich,” he told Accoona executives, “but, remember, you are doing something good for humanity as well.”

- Source.