The most disturbing finding in the Royal Commission of Inquiry report on Tabung Haji is its confirmation that political pressure connected to an election influenced the institution’s financial decisions and contributed directly to its financial crisis in 2017.
Paragraph 3.17.8 of the report states that Tabung Haji began facing difficulties when the domestic stock market weakened from 2014 and its reserves were eroded by high profit distributions. Despite the deteriorating financial environment, political pressure was exerted to maintain distribution rates at the high levels paid in previous years.
According to the RCI, this political pressure caused Tabung Haji to make several decisions that eventually led to its financial crisis in 2017.
Paragraph 3.17.13 makes an even more serious finding. It states that “political pressure in facing an election” drove decisions that became a principal cause of Tabung Haji’s financial crisis.
This is not an allegation made by an opposition party or the opinion of a political analyst. It is the official finding of a Royal Commission of Inquiry after examining documents, financial reports, witness testimony and decisions made by Tabung Haji’s board and management.
The RCI did not identify the individual or individuals who exerted this political pressure. However, the political environment and governance structure at the time are clearly documented in the report.
Paragraph 3.2.13 identifies three UMNO political figures who served on the Tabung Haji board during the period examined by the RCI.
Abdul Azeez Abdul Rahim was appointed as a board member in 2011 and subsequently served as chairman from 2013 to 2018. During this period, he was the Member of Parliament for Baling and a member of the UMNO Supreme Council.
Badruddin Amiruldin served on the board from 2005 to 2018. He was a former Member of Parliament for Yan and Jerai and the permanent chairman of the UMNO General Assembly.
Rosni Sohar served on the board from 2014 to 2018. She was the state assembly woman for Hulu Bernam, a member of the UMNO Supreme Council and the secretary of Wanita UMNO Malaysia.
The RCI also recorded in paragraph 3.3.2 that Abdul Azeez held positions in eight Tabung Haji subsidiaries and related entities while serving as chairman.
This represented a significant concentration of influence and responsibility in a political figure. Abdul Azeez did not only lead the main Tabung Haji board, but also held positions across numerous entities within the institution’s corporate structure.
Political responsibility was not confined to the composition of the board. Jamil Khir Baharom of UMNO was the minister responsible for supervising Tabung Haji from 10 February 2009 until 9 May 2018.
Paragraph 2.2.8 explains that the Tabung Haji Act 1995 gave the minister extensive statutory powers. The minister could appoint and remove the chairman and board members, appoint the chief executive officer, issue directions to the board and approve financing provided to Tabung Haji subsidiaries.
The minister also had the power to approve every Tabung Haji investment activity in Malaysia and overseas, determine transfers from its reserve fund and approve the amount of profit that could be distributed to depositors.
The minister’s role therefore cannot be treated as ceremonial or peripheral. The legal structure placed significant authority and responsibility in the hands of the minister.
UMNO must explain how election related political pressure was allowed to influence Tabung Haji when an UMNO minister possessed such extensive statutory powers and three UMNO political figures served on its board.
The RCI report does not amount to a criminal conviction against Abdul Azeez, Badruddin, Rosni, Jamil Khir or any other individual. Any criminal responsibility must be determined through a proper investigation and court proceedings.
However, the absence of a criminal conviction does not remove the need for political accountability.
UMNO must explain who pressured Tabung Haji to maintain high profit distributions ahead of an election, who knew about those decisions and what the minister and board did to protect the institution’s depositors.
UMNO must also state publicly whether it will support the RCI’s recommendation to prohibit active politicians from serving as chairman or board members of Tabung Haji and its subsidiaries.
The RCI has established that election related political pressure influenced financial decisions and became a principal cause of Tabung Haji’s financial crisis. Those who held political power at the time owe millions of depositors a full explanation.