PAC flags dubious property deals by HRD Corp

• The PAC report also revealed that HRD Corp had paid a 50% deposit, or RM120 million, for the purchase of Menara Ikhlas in Putrajaya, worth RM202.5 million in February 2021. However, the transaction was later cancelled over a year after the deposit was paid.

KUALA LUMPUR (July 4): The Public Accounts Committee (PAC) flagged that the Human Resource Development Corp (HRD Corp) had engaged in several dubious property deals, including the purchase of a RM154 million building, without the approval of its board.

Former HRD Corp chief executive Elanjelian Venugopal told the bipartisan committee that the six-storey building in Bangsar South was intended to be the headquarters (HQ) of the company, according to the PAC report released on Thursday. The HQ move did not happen, as it became a “controversial issue”, he said.

“Due to the absence of documentary evidence regarding the purchase of the building, HRD Corp could not confirm the party responsible for the purchase,” the report stated.

The building, acquired in 2017 without approval from the board of directors, was instead only made under the jurisdiction of the chief executive officer, the PAC was told. Elanjelian was appointed as the chief executive of the agency in July 2018 to succeed Datuk CM Vignaesvaran Jeyandran.

The PAC report also revealed that HRD Corp had paid a 50% deposit, or RM120 million, for the purchase of Menara Ikhlas in Putrajaya, worth RM202.5 million in February 2021. However, the transaction was later cancelled over a year after the deposit was paid.

The deposit paid was more than 50% of the purchase price of the building, which was “somewhat unusual because the deposit that should be paid is only 10% of the purchase price,” the report stated. Further, contents of the sales and purchase agreement was “a lease to purchase agreement”, it noted.

Former HRD Corp chairman Datuk Seri Jamil Salleh told the PAC that the purchase of Menara Ikhlas was cancelled due to the seller failing to meet conditions, which he did not specify.

In another proceeding, current HRD Corp chairman Datuk Rajasekharan Ramasamy said that the RM120 million deposit had been returned to the company, with an interest of RM3.2 million.

The PAC also flagged the purchase of a block of a commercial building called Sutera Avenue in Kota Kinabalu for RM16 million, which was not tabled at the board meeting.

While the purchase was approved by the company’s investment panel, the board of directors was asked to sign the statement of arm’s length transaction without being provided complete information about the property.

“The approval process for property acquisitions by HRD Corp has gone through various procurement methods and has not been a consistent procedural standard process,” PAC chairperson Datuk Mas Ermieyati Samsudin told a press conference earlier on Thursday. “In addition, there are property purchase transactions that were not supplied with complete documents to the board of directors of HRD Corp.”

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