Tabung Haji’s RM10b hole could have been avoided if BNM warnings were heeded, Dewan Rakyat told

The financial troubles of the Tabung Haji (TH) institution could have been prevented if Bank Negara Malaysia (BNM) had taken appropriate action on the warning letters it issued to TH regarding its financial position, reserves, and liquidity management from 2014 to 2016, according to Dr. Zulkifli Hasan, Minister in the Prime Minister's Department (Religious Affairs).

BNM sent five warning letters to TH's Chairman and the responsible Minister during this period. Had these warnings been addressed effectively, TH's financial issues might have been curbed earlier, avoiding the need for a RM10 billion bailout by the government by the end of 2018. Zulkifli made these remarks while concluding the debate on the Special Meeting of the Dewan Rakyat that discussed the Royal Commission of Inquiry (RCI) Report on TH.

The RCI had recommended that TH should not have received a Clean Audit Certificate and should have instead been given a qualified opinion, with specific issues highlighted as "Emphasis of Matter." BNM, responsible for financial stability, monitored TH's developments continuously but found that TH's actions from 2014 onwards showed no serious attention to BNM's warnings.

This included declaring dividends when assets were less than liabilities and distributing unprudent hibah (dividends) regardless of TH's financial position, a practice that continued until 2017. Zulkifli assured that amendments to the Tabung Haji Act 1995 (Act 535) will be implemented immediately to enhance TH's governance. He also mentioned that a forensic audit has been conducted on the investments mentioned in the RCI report.

Furthermore, the proposal for a Multi Agency Task Force to investigate investments at risk of loss has been welcomed and will be examined for implementation. The government's approach now involves investigating, taking enforcement actions, recovering assets, and strengthening laws and governance to protect TH depositors' trust and interests.

The debate on the RCI report in the Dewan Rakyat lasted over 10 hours, with 39 Members of Parliament participating. The Speaker of the Dewan Rakyat, Tan Sri Johari Abdul, thanked the MPs and ministers for their involvement and indicated that the Third Meeting, scheduled for October, will continue discussions if further questions arise.