Finance Minister II Datuk Seri Amir Hamzah Azizan disclosed to Parliament on August 11 that Lembaga Tabung Haji's entire approval process for acquiring a 30 per cent stake in Putrajaya Perdana Bhd occurred during a period when the company was allegedly under the control of fugitive financier Low Taek Jho—known as Jho Low—operating through Utama Banking Group Bhd. This revelation emerged during debate on a Royal Commission of Inquiry report into Tabung Haji's management and operations, with the Finance Minister basing his statements on sworn testimony presented in the SRC International case.
According to evidence from Putrajaya Perdana director Datuk Rosman Abdullah, the company received RM170 million channelled from SRC International to its subsidiary Putra Perdana Construction across three separate transfers between July and August 2014. Amir Hamzah emphasized that under the sworn testimony, Putrajaya Perdana remained under Jho Low's control through UBG for as long as the company sale had not been finalised—a transaction that did not complete until April 13, 2015. This timing proved significant because the entire chain of approvals fell within this window of alleged control.
The chronology of the approval process painted a concerning picture for Tabung Haji's decision-making. The Investment Panel approved the deal on July 24, 2014, the board followed on August 25, ministerial approval arrived on August 27, and the sale and purchase agreement was signed on December 3, 2014. Every stage of the acquisition process, therefore, occurred while the seller remained under Jho Low's alleged influence. However, Amir Hamzah noted that the court had made no formal finding that Jho Low was the beneficial owner of Putrajaya Perdana at that time, with the allegation resting on sworn testimony rather than judicial determination.
Significantly, a 2023 fact-finding assessment revealed that Tabung Haji's Investment Panel had requested on July 24, 2014 that management identify the ultimate shareholder of the company being sold. This crucial due diligence step went unanswered, yet the transaction proceeded regardless. Tabung Haji ultimately paid RM193.5 million to Cendana Destini Sdn Bhd in December 2014 for the 30 per cent equity stake, based on two key promises that the company would be relisted within a year and achieve a profit of RM86 million in 2015. Neither commitment materialised, representing a significant failure in investment governance at the Islamic pilgrimage savings fund.
The valuation process itself raised red flags that suggested inadequate oversight. Tabung Haji's Research Division initially disagreed with the proposed RM206 million valuation for the 30 per cent stake, instead estimating its worth between RM124 million and RM155 million. Yet the Investment Panel eventually approved RM193.5 million without providing written justification for either the valuation increase or the unexplained expansion of the acquisition from 25 per cent to 30 per cent. This represented a departure from prudent investment practices and raised questions about accountability within the fund's governance structure.
Additionally, the investigation uncovered that due diligence was conducted only after all approvals had been obtained and was never presented to either the Investment Panel or the board before the sale agreement was signed. The 2023 assessment identified a broader pattern of governance failures, finding that four separate investments had not undergone required due diligence while recommendations from the Risk Management Department were not properly addressed. For Malaysian investors in Tabung Haji, these revelations underscored systemic weaknesses in how their savings were being managed and invested.
A particularly damaging disclosure concerned the price trajectory of the asset. The seller had originally acquired the entire equity stake in Putrajaya Perdana for RM260 million in 2012, meaning a 30 per cent stake would have been worth approximately RM78 million at that time. Just two years later, Tabung Haji paid RM193.5 million for the identical stake—representing a nearly threefold increase in value that was never adequately explained or justified to the fund's leadership. This massive markup, combined with the failure to identify the ultimate beneficial owner, suggested either profound analytical failure or worse.
The investment's subsequent deterioration accelerated these concerns. When the initial promises failed to materialise, Tabung Haji exercised a put option worth RM210.7 million in March 2018, demanding that the seller repurchase the shares. The seller declined to do so, leaving Tabung Haji holding a worthless asset. By the 2024 financial year, the entire RM193.5 million investment had been fully impaired, effectively wiped from the fund's balance sheet. This outcome represented a complete loss for Tabung Haji contributors whose retirement savings had been deployed in what appeared to be an inadequately vetted transaction.
Tabung Haji is now pursuing legal recourse through the courts, having filed a writ and obtained a Mareva injunction to freeze the seller's assets. Court-directed mediation was scheduled for August 11, with trial proceedings set for June 23, 2027. The case represents a significant test of whether Tabung Haji can recover any portion of its losses and whether accountability can be assigned for the investment decisions that led to such a substantial impairment.
The disclosure sparked fresh parliamentary concerns about the connection between the Putrajaya Perdana investment and the 1MDB scandal that continues to haunt Malaysia's financial reputation. SRC International, through which RM170 million flowed to the construction subsidiary, was formerly a subsidiary of 1Malaysia Development Bhd and was alleged to have been secretly controlled by Jho Low through Utama Banking Group. For Tabung Haji depositors—many of whom are ordinary Malaysians saving for the Islamic pilgrimage—the revelation that their funds may have been invested in a structure connected to 1MDB represented a breach of trust and fiduciary responsibility.
This situation underscores ongoing governance challenges within major Malaysian financial institutions and the importance of robust oversight mechanisms. The gap between the initial Investment Panel request for beneficial ownership information and the transaction's completion suggested that governance failures were not accidental but systemic. For regional investors monitoring Malaysia's financial market integrity, the Putrajaya Perdana case illustrates the persistence of opaque dealing practices and the prolonged process of achieving accountability for decisions made during periods of suspected improper influence.
