Lembaga Tabung Haji’s (TH) investment decisions involving Tun Razak Exchange (TRX) land and Putrajaya Perdana Bhd (PPB) came under intense scrutiny during Tuesday’s special Parliament sitting debating the Royal Commission of Inquiry (RCI) report into the pilgrimage fund.
Minister in the Prime Minister’s Department (Religious Affairs) Dr Zulkifli Hasan said TH’s investment in PPB ultimately drew the institution into transactions linked to 1Malaysia Development Bhd (1MDB) and resulted in losses of RM145.3 million.
Zulkifli said PPB was among 14 problematic investments identified in the RCI report as contributing to losses amounting to billions of ringgit.
He also highlighted TH’s purchase of land at TRX from 1MDB during the period when the sovereign fund was already facing intense scrutiny.
The minister questioned the circumstances surrounding the transaction, noting that TH’s chief executive officer at the time was also a member of 1MDB’s board of directors.
This raised questions over whether the acquisition was made primarily in the interests of TH and its depositors, or whether it was intended to help address the financial difficulties of another party.
“Was the investment at that time in the interests of TH, or to solve the problems of other parties?” Zulkifli was quoted as asking during the special sitting.
The PPB investment also came under scrutiny because the then TH chairman was appointed chairman of PPB, creating concerns over overlapping roles and governance in relation to the investment.
According to the parliamentary briefing, the arrangement subsequently exposed TH to transactions involving entities connected to 1MDB, with the investment ultimately resulting in the RM145.3 million loss.
The TRX transaction was separately highlighted during the debate.
TH had acquired land at TRX from 1MDB during the height of the controversy surrounding the latter. The transaction has now come under renewed scrutiny because of the overlapping position held by TH’s CEO and 1MDB’s board at the time.
Zulkifli said the government had since taken steps to strengthen TH’s financial position. He noted that TH had subsequently repurchased the TRX land, which it had sold in 2018 for RM400 million, at RM270 million based on its current market value.
The TRX project itself was developed by 1MDB and later required substantial government support to ensure its completion. A 2018 Finance Ministry statement said the government had approved up to RM2.8 billion in additional funding for TRX infrastructure, bringing total federal allocation to the project to RM6.5 billion.
The revelations form part of the wider RCI findings being examined by Parliament as lawmakers assess the factors that contributed to TH’s past financial difficulties and the measures taken to restore the institution’s financial health
