Malaysia investigates franchise bribe claims

The Malaysian government is facing calls for a public inquiry into the marketing practices of institutions keen to sell overseas franchise courses to the country's students. The inquiry could have wide implications for British universities running such courses if, as seems likely, the Malaysian authorities introduce more rigorous rules.

The calls have been prompted by the methods used to sell University of Wales-approved courses franchised by the Swansea Institute of Higher Education. There are also allegations that Malaysian ministry of education officials have received bribes of up to M$100,000 (Pounds 25,700) from local private colleges in return for permits to run British courses.

Kuala Lumpur Central MP Wee Choo Keong - backed by the Malaysian ministry of education - is to call for a full investigation in parliament. He will also ask for the inquiry to look at the often-aggressive methods used to sell courses. The inquiry will serve as a warning to Malaysia's private sector and may hit overseas institutions.

The British Council confirmed that the Malaysian government is "watching quality like a hawk" and warned that institutions with a slack record on standards would have "a big problem".

The Malaysian government is almost certain to give the go-ahead to a public inquiry. It is anxious to safeguard academic standards in the drive to become the regional capital for international education provision and it is understood to be concerned that many British franchise courses have been sub-franchised overseas to low-ranking institutions.

Advisers close to Mr Wee, a lawyer and politician with a reputation for rooting out corruption, say that the Malaysian government already possesses three statements from people who have confessed to paying bribes to government officials. The inquiry is likely to examine the work of TL Management, the Kuala Lumpur-based institution which runs courses with Swansea Institute.

The Malaysian inquiry will parallel the joint Higher Education Funding Council for Wales and National Audit Office investigation that prompted the resignation of Gerald Stockdale, principal of Swansea Institute, after revelations about the lax academic standards of the Malaysian courses.

The HEFCW-NAO investigation is exploring the financing of the institute's overseas franchise operation.

Swansea Institute announced that Alan Davies, assistant principal, will replace Professor Stockdale as principal.

Hywel Rees, vice principal, who was closely involved in the overseas franchise operation, has been suspended on full pay until the conclusion of the inquiry.