A MALAYSIAN minister pleaded not guilty yesterday to corruption charges after he was taken into custody in the most high-profile arrest since Prime Minister Abdullah Badawi took office on a clean government ticket.

Minister of Land and Cooperative Development Kasitah Gaddam looked calm as anti-corruption officials took him to a Kuala Lumpur sessions court after arresting him earlier in the day for taking kickbacks in share deals worth millions of dollars.

?Not guilty,? the 57-year-old minister told the court in response to two charges of corruption. He was granted bail of one million ringgit ($260,000) for a trial to be fixed at a later date and his passport was confiscated.

If convicted, the minister faces up to 14 years in jail, a fine, or both. Malaysian shares were 0.33 percent higher by midday but off their peak as speculation of more arrests unsettled the market.

?It?s good what the authorities are doing, but at the same time it is prompting speculation of who will be next. This is making the market a bit uneasy,? said an institutional dealer with a bank-backed brokerage.

Abdullah, who came to office in October, has portrayed himself as a new broom sweeping through Malaysia, ordering a crackdown on red tape and corruption in business, the government and the police.

The high-profile arrest of Kasitah comes with a general election likely within months or even weeks.

Although Abdullah?s multi-racial coalition is expected to win a landslide, his key test will be to win back majority Malays, particularly those in rural areas where opposition taunts of government corruption have hit home.

Kasitah abused his post as chairman of the Sabah Land Development Board (SLDB) in the eastern Borneo island state for financial gain, according to the charges filed against him.

Authorities accused him of taking part in a 1996 decision to sell 16.8 million shares held by SLDB in Sapi Plantations Sdn Bhd on the promise of 3.36 million Sapi shares for himself.

They also charged him with deceiving fellow board members over PPB Oil Palms Sdn Bhd?s plans to offer five shares for each Sapi share as part of its listing on the Kuala Lumpur Stock Exchange main board.

The arrest was related to transactions valued at 30 million-40 million ringgit ($7.9-$10.5 million), Bernama news agency quoted Anti-Corruption Agency Deputy Director General Zawawi Nordin as saying.

The politician was arrested earlier in the day at the Anti-Corruption Agency headquarters in the administrative capital, Putrajaya, after being summoned to help with investigations.

?We have a very good chance of defending this case,? Defence lawyer Shafee Abdullah told reporters outside court.

He said Kasitah was likely to be tried jointly with a man charged in Sabah on Thursday but declined to give details.

On Tuesday, Eric Chia Eng Hock, former head of Malaysia?s state-controlled Perwaja Steel and the first big businessman arrested for corruption-linked charges under Abdullah, pleaded not guilty to criminal breach of trust and was freed on bail.

Jalil Hamid