The Royal Commission of Inquiry (RCI) on July 29, 2026, disclosed that Lembaga Tabung Haji (TH) incurred massive losses totaling billions of ringgit from 14 problematic investments, many linked to the 1MDB scandal [1, 2]. Among the losses, TH recorded RM145.3 million in Putrajaya Perdana Bhd, where the company’s then-chairman was simultaneously TH’s chairman, creating overlapping interests with 1MDB-linked deals [1, 3, 2, 4].

TH also acquired land at Tun Razak Exchange (TRX) from 1MDB during the height of the scandal, while TH’s CEO concurrently sat on 1MDB’s board, raising conflict of interest concerns. Minister Dr. Zulkifli Hasan questioned whether these moves served TH or to address other problems, remarking, "A big question arises when TH’s chief executive officer was also a member of 1MDB’s board of directors" [1].

The report revealed an unrealised loss of RM1.059 billion on TH’s investment in FGV Holdings Bhd, which was privatized in August 2025 at RM1.30 per share—far below TH’s average purchase price between RM4.58 and RM5.01 [5]. Additionally, seven of the 14 investments faced full impairments. The largest was RM1.86 billion at Al-Rawda Real Estates in Saudi Arabia as of end-2024, with other losses including RM193 million at Putrajaya Perdana, RM364 million in Trurich Resources, RM63 million at Alfareeda Residential Fund, and RM198 million at TH Marine plus RM80 million financing [6].

The government intervened in 2018 by assuming RM10 billion of TH’s non-performing assets through Urusharta Jamaah Sdn Bhd and issued sukuk bonds to restructure the fund’s liabilities. A 2026 sukuk refinancing extended maturity to 2036 and provides TH with fixed annual coupon payments of about RM440 million in cash [7]. Finance Minister II Datuk Seri Amir Hamzah Azizan said, "The root cause was financial and investment misconduct," not just an accounting problem [6].

The RCI cited weak governance, political interference, misconduct, irregular approvals, and poor due diligence as causes behind these losses [1, 8, 6, 9]. Parliamentary members called for urgent forensic audits and a multi-agency task force involving MACC, police, and tax authorities to investigate all 14 investments, while opposition MPs warned the bailout and ongoing fiscal support threaten to burden taxpayers and future generations [8, 10, 4, 11].

Former MP Syed Saddiq warned, "If there are losses and you continue paying high hibah, the money does not simply come from nowhere. We are transferring the burden from one generation to another" [10]. The RCI also highlighted conflicts of interest due to key leadership overlaps between TH and 1MDB and approvals given without proper expertise [8, 3, 4].

TH’s former CEO and chairman were abruptly terminated in 2021 despite reform efforts, a development said to have stymied institutional recovery [12]. The government maintains it has never defaulted on debts and continues to honor sukuk payments to stabilize TH [7].

The RCI report covers TH investments from 2014 to 2020, providing a detailed blueprint for investigations and reforms to follow.