Ever wondered how Barisan Nasional (BN) won the poster war in the recent polls? Here's one answer - the ruling coalition got the posters for 'free'. To be exact, no one in BN has yet to pay for them. The bill itself was an astounding sum.

Three months after BN's thumping victory in the March 21 polls, dozens of companies are claiming that they have not been paid for supplying BN an estimated RM100 million worth of election paraphernalia.

These were not just posters. Among the campaign materials sent to BN poll offices nationwide were plastic banners, T-shirts, caps, mineral water, button badges, lapel pins, key chains, lighters and pens - all adorned with the coalition's distinctive dacing logo.

Malaysiakini understands that letters have been sent to BN leader, Prime Minister Abdullah Ahmad Badawi, urging him to settle the debt.

However, Abdullah denied that his coalition was involved in the multi-million-ringgit purchase of campaign merchandise. He advised the complainants to instead resolve the matter with those who had directly made the purchase orders.

It is learned that the troubled suppliers have also met leaders of other BN component parties to complain about their woes - MCA chief Ong Ka Ting and Gerakan vice-president and Penang Chief Minister Dr Koh Tsu Khoon.

The suppliers, who spoke to malaysiakini on condition of anonymity, said the orders for the campaign materials were placed through a company called Elegant Advisory, whose shoe-box office is in Setapak, about 5km north of Kuala Lumpur.

Elegant Advisory had claimed that it received a lucrative 'government contract' to supply the ruling coalition posters and other campaign paraphernalia for the 2004 elections.

'Backed' by Umno bigwig

A check with the Registrar of Companies revealed that the key owner of Elegant Advisory is 51-year-old Hasan Ayuob.

According to the suppliers, Hasan said he was backed by an 'influential' Umno politician, who had been tasked to raise funds from BN-linked tycoons and companies for the polls.

However, little is known about Hasan, a shadowy deal-maker who often introduced himself as a 'datuk' and is fond of talking about his close links with top figures in government.

It is believed that Hasan conceived the grand scheme to supply campaign merchandise to BN two years ago when he set up Elegant Advisory as a RM9 company.

Negotiations between Elegant Advisory and the suppliers - some of which are the country's top printers - began in earnest late last year.

And when Abdullah called a snap general election in March, Hasan awarded contracts worth millions of ringgit to scores of companies.

To clinch the deal, these companies paid RM15,000 each to Elegant Advisory - a normal practise according to those involved in the procurement of government contracts.

One source said that Elegant Advisory had signed up approximately 70 companies for the BN project, thus raking in about RM1 million from the 'entry fees' alone.

Having paid the fees, these 'main contractors' in turn parceled out part of the contracts to minor suppliers - for orders which they could not meet themselves - in return for some commission.

Most of these third-level suppliers turned to factories in China, where labour and raw material are cheap, to meet the rather unrealistic deadlines due to an exceedingly short campaigning period - seven and a half days.

As a rule, these companies would have demanded a 50 percent down-payment, with the rest be paid on delivery. However, no down-payment was made by Elegant Advisory.

But why did these contractors, some of them reputable companies, throw caution to the wind?

"We believe we will be paid. After all, this is a 'government contract'," said one supplier.

In addition to this blind faith, many of them were also awe-struck by the scale of the contracts, and the profit margins, given the enormous size of the orders. Not surprisingly, few questions were asked.

"One major supplier, which made plastic BN posters, is owed RM21 million," revealed a source.

And when questions were raised, the contractors were told by Elegant Advisory not to fret and that money will come.

Anxious suppliers

Four days before polling day, a group of anxious suppliers - who had their goods manufactured but yet to receive their down-payment - met with Hasan.

The Elegant Advisory chief told them that payment day was March 20 and - given that the campaigning was already in full swing - they should deliver their products immediately. Polling day was March 21.

"What choice did we have? Our goods had already been flown in from China. We will suffer if we did not deliver them," said an exasperated businessman. "We sent the merchandise to Elegant Advisory's Setapak warehouse for distribution."

The warehouse was a shoplot, about a stone throw away from the Elegant Advisory's office.

"Tents were erected in front of the warehouse. People from (BN) branches got all their election stuff from there. It was like a carnival," said the businessman.

He said the frenzied activity in the few days leading up to polling day led to traffic congestion in the vicinity of the warehouse.

"It was so bad that a number of people were hired to ease the jams," he added.

However, no money changed hands in the transactions between Elegant Advisory and the BN branches.

"All the BN branches - Umno, MCA, MIC - were given a DO (delivery order) by Elegant Advisory helpers. The BN representatives came to the warehouse with their branches' stamps to 'chop' the delivery order," said a source who was there.

"We believe that Hasan compiled the delivery orders and sent them to BN for payment." He added that video footages were also taken by Hasan's aides as proof of delivery.

But not all the election paraphernalia went through the Setapak warehouse. Elegant Advisory has a bigger warehouse in Port Klang to receive consignments from China. From here, the merchandise went direct to BN poll offices.

In addition, some contractors, which have factories in Malaysia, received lists of BN offices from Elegant Advisory with instructions on where to send their merchandise.

In those few frantic weeks, lorries laden with mineral water left factories in Kuala Lumpur for all parts of the country. So too were those with manufactured plastic posters.

"For one week, lorries organised by Elegant Advisory came to my factory non-stop, and they were loaded with plastic posters for transportation nationwide," said one source who made posters depicting the prime minister.

The number of BN posters was so enormous that they are not measured in pieces, but in tonnage.

"I sent 800 tonnes of posters," he said, whose bill was about RM6 million.

Elegant Advisory's BN project also included Sabah and Sarawak. A supplier in Sabah said he delivered RM1 million worth of mineral water and plastic flags.

"I sent them to the Umno warehouse in Sabah. In Sarawak, the merchandise were delivered to BN's component party PBB (Parti Pesaka Bumiputera Bersatu). Both offices organised the distribution of the campaign materials in the two states," said a source.

'Ministry's letter'

Contrary to what was promised by Hasan, there was no payment on March 20. In the weeks that followed, the irate contractors held a number of meetings with Hasan.

At one meeting, the contractors were shown a letter.

"It has a ministry's letterhead and it said Elegant Advisory was appointed to supply BN poll stuff amounting to RM800 million. It also said the company would be paid on June 15," said a source, who was unable to identify the ministry concerned. However, he figured that the letter could be forged.

June 15 came and went, and still there was no sight of any money.

"Hasan is a very smart man. He keeps giving us hope that the money would be released. And the money owed is so much that we cannot afford to give up hope," said a businessman.

One of the suppliers, who had delivered BN caps and button badges for three previous elections, was mystified by the non-payment. He had no problem getting paid before.

"If we don't resolve the payment soon, a lot of companies will go bust," he warned. "This involves quite a substantial sum. It affects a lot of families. We are using up our bank facilities and are being chased by the banks. Some borrowed from loan-sharks."

Malaysian companies are not the only ones hit by the scandal. An overseas firm, which had done similar deals for the Bush 2000 campaign and the Nigerian elections, despatched 700,000 badges worth RM1 million to Malaysia.

When the supplier asked for the down-payment from Elegant Advisory, Hasan told her: "Believe me, I'm working for the government. Others are not getting their payment too. Why should you worry?"

She told malaysiakini that her factory in China worked around the clock to get the badges ready for the elections. And given the short deadline, another supplier had to be roped in to help produce the BN badges in time.

"This is worse than doing business in China," she decried. "I saw BN leaders wearing my badges on TV. Why don't they pay up? What kind of country is this?

"I have been in this business for 20 years. This has never happened to me before. Not even the African countries I've dealt with."

According to her, she had written letters, including to Abdullah, but to no avail. She is now seeking help from her country's embassy in Kuala Lumpur.

Astounding sum

It is not clear how much money was involved in the BN's 'contract' for the poll paraphernalia.

One source, who is a former employee of Elegant Advisory, said he saw an outlandish figure of RM1.8 billion being tossed around when he was with the company.

Another said it was about RM800 million, still an astounding amount. But from the suppliers whom malaysiakini had talked to, they estimated that they are collectively owed close to RM100 million.

There are others who are keeping mum on their plight.

The reason for their silence? They don't want to make worse a situation that is already in the pits, said a contractor. They are also embarrassed that they had been 'hookwinked' by a consummate smooth-talker.

Nevertheless, they are still holding out hope that the payments would be made - eventually. By whom, they are not quite sure.

As for the BN leaders, not one is conceding that any of them was involved in the affair, despite being beneficiaries to the scheme.

Who is the Umno bigwig who is said to be backing Hasan? Or perhaps Hasan is working alone. Only he can tell. But repeated attempts by malaysiakini to reach him had been unsuccessful.

Whatever the case may be, the so-called BN contract for the poll merchandise has given a new meaning to 'free' elections.

According to one source, Hasan however appeared confident that he would get the money to pay his contractors.

He had boasted: " Kalau saya kena penjara, semua Barisan MPs pun kena sebab mereka ambil barang saya 'free'." (If I'm jailed, all Barisan MPs will also get it because they took my things for free).