This article first appeared in The Edge Malaysia Weekly on December 30, 2024 - January 12, 2025

ON Dec 9, at around noon, news broke that a Public Accounts Committee (PAC) report had indicated that the Malaysian Anti-Corruption Commission (MACC) had cleared the management of Human Resource Development Corporation (HRD Corp), including its CEO Datuk Shahul Hameed Dawood, of any wrongdoing.

“We opened an investigation paper and we found no offence had been committed under the MACC Act,” an MACC investigation officer, Fuad Sedet, was quoted as saying.

A few hours later, at about 5pm, Fuad Sedet’s boss, chief commissioner Tan Sri Azam Baki contradicted his statement.

Azam Baki told the media that all investigations were still ongoing. He explained that Fuad might have been referring to just one part of the MACC’s investigations. “We opened a few files against HRD Corp. All investigations are still ongoing, and I have directed my officers to inform the PAC that the officer may have been referring to one of the files (but not all the files),” he said.

Roughly two weeks before that, Human Resources Minister Steven Sim Chee Keong confirmed that Shahul Hameed, who had been on administrative leave since July 18, had indeed returned to work.

“Everyone is assumed innocent until proven guilty and in this case, no HRD Corp personnel has been charged in court … it is unfair for us to point fingers at anyone before the investigation is completed,” Sim told Dewan Rakyat in November.

The alleged issues at HRD Corp came to light in July after the Auditor-General’s report recommended that enforcement action be taken against the agency, and the PAC highlighted alleged instances of mismanagement, such as questionable property transactions, suspicious disbursements and investments that were deemed risky.

One of the deals was the acquisition of a RM154 million, six-storey building in Bangsar South, Kuala Lumpur, without board approval. Then there were the alleged lack of good governance practices, and no real checks and balances when undertaking its investments.

Among HRD Corp’s largest investments in public-listed companies by value are RM99.99 million in property developer Chin Hin Group Bhd (KL:CHINHIN), RM65.05 million in 7-Eleven Malaysia Holdings Bhd (KL:SEM), RM59.99 million in construction and facilities management company Widad Group Bhd (KL:WIDAD), RM59.38 million in Berjaya Food Bhd (KL:BJFOOD), RM53.82 million in Berjaya Corp Bhd (KL:BJCORP), and RM39.99 million in agrochemical distributor Hextar Global Bhd (KL:HEXTAR).

Three companies — 7-Eleven, Berjaya Food, Berjaya Corp — are controlled by businessman Tan Sri Vincent Tan Chee Yioun, and Hextar Global and Chin Hin are linked to Datuk Eddie Ong Choo Meng.

Trading at around five sen, Widad has suffered losses in the last five consecutive quarters.

HRD Corp also invested RM170 million in Redeemable Cumulative Convertible Preference Shares of Berjaya Capital Bhd and Singer (M) Sdn Bhd, both of which are private companies.

The PAC has flagged the HRD Corp as using RM3.77 billion for its investing activities. 

HRD Corp has sought to defend itself against all allegations, saying that it operates within the ambit of Pembangunan Sumber Manusia Bhd Act 2001, and there are put and call options in place, which make the investments “safe”. The general consensus is that the investments are questionable.

HRD Corp collects mandatory levies from 800,000 employers for staff training and upskilling. The employers are required to choose from HRD Corp’s list of approved training programmes in order to claim the costs. 

The corporation is a government statutory body that is dealing with the public’s money, it must uphold a high level of governance, accountability and transparency and account for every ringgit spent.

In an interview with The Edge, former chief operating officer Datuk Ariff Farhan Doss spoke of the shenanigans that he claims took place at HRD Corp. However, he hinted that nothing would change, even after the exposé.

It does appears that nothing has changed at HRD Corp so far.

HRD Corp, as well as the government, may cite the ongoing MACC investigation for the lack of action taken to address the issues flagged. The confusing and conflicting statements by MACC do not help either.

Sim’s statement on presumption of innocence is commendable but the ministry should consider the CEO’s inherent extensive decision-making authority.

To address the public’s concerns about HRD Corp, Sim has said the ministry would appoint a professional third-party auditor to address the issues raised.

Has the audit been conducted? Or is it also ongoing? 

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