Malaysia's pilgrimage fund booked a RM3.4B profit that was really a RM1.4B loss

Tabung Haji is where more than nine million Malaysian Muslims save for the haj, with over RM96 billion under management. A Royal Commission of Inquiry reviewing 2014–2020, whose 200-plus-page report was finished in 2022 but made public only on July 29, 2026, found the fund had reported a RM3.4 billion profit for 2017 when it should have recorded a RM1.4 billion loss: accounting practices artificially boosted asset values, enabling unsustainable dividends (hibah) and staff bonuses of up to 13 months — a RM74 million allocation in 2014 — while liabilities exceeded assets between 2014 and 2017.

The commission found political interests influenced decisions on dividend rates, haj subsidies and financial aid, and faulted the Tabung Haji Act 1995 for giving the religious affairs minister extensive powers over operations and investments. After the 2018 change of government, a restructuring transferred about RM9.7 billion in underperforming assets to government-owned Urusharta Jamaah in exchange for RM19.9 billion in sukuk and cash — with the government absorbing RM10.2 billion of the losses.

Prosecutions followed. Former religious affairs minister Jamil Khir Baharom was charged on September 14, 2026 with dishonestly causing TH to improperly transfer over RM860.3 million between 2015 and 2017 to Saudi property firm Al-Rawda for leases on four hotels in Mecca and Medina — a tenant that stopped paying rent in March 2019, leaving 560.7 million Saudi riyal unpaid by December 2021. Former chairman Azeez Abdul Rahim was charged on September 9 with using his position to secure a RM690,000-a-year chairmanship at Putrajaya Perdana while pushing the board to invest RM193.5 million there.

Accounting that lifted asset values turned losses into distributable paper profits, so dividends and bonuses could keep flowing regardless of performance.

The minister's statutory powers over investments made political objectives — dividend rates, subsidies, showcase property deals — into board decisions.

Signature bets like the Al-Rawda hotel leases went unchallenged until the tenant simply stopped paying, exposing RM860 million in transfers to criminal charges.

When payouts are set by politics, accounting becomes the flex: paper profits let a fund pay dividends it never earned, until someone else pays the bill.

The RCI called for banning active politicians from the board, forensic audits of past investments, and splitting oversight so the religious affairs minister handles haj logistics while the finance minister oversees investments. The charges against Jamil Khir and Azeez came amid Prime Minister Anwar Ibrahim's anti-corruption drive, with critics questioning the timing ahead of state elections.