KUALA LUMPUR, July 21 — Datuk Seri Tengku Zafrul Abdul Aziz today defended KWAP’s due diligence in its RM163.4 million investment in Indonesian aquaculture technology firm eFishery, saying the pension fund was among several prominent global investors deceived by years of falsified financial statements.

The senior political adviser to the prime minister said KWAP was a minority shareholder holding just 2.51 per cent of the company, and had invested alongside major institutional investors including Singapore’s sovereign wealth fund Temasek, Japan’s SoftBank, Indonesia-focused investment firm Northstar, and Abu Dhabi-based 42X Fund.

“At the time, eFishery was valued at around US$1.4 billion. KWAP did not invest on its own. It held only a 2.51 per cent stake, making it a minority investor. The majority of the investment came from other investors,” he said in a video posted on his social media accounts.

“In other words, there were investors much larger than KWAP, including those with extensive experience in the Indonesian market,” he added.

The former investment, trade and industry minister said subsequent investigations found that eFishery’s management had manipulated the company’s financial statements for years, resulting in investment decisions being made based on false information.

“The founder of eFishery was later charged and sentenced to nine years’ imprisonment for criminal breach of trust and money laundering,” he said.

Responding to questions over whether KWAP had carried out adequate due diligence before investing, Tengku Zafrul said the proposal had been assessed by the fund’s investment team before being approved by its investment panel.

“There was due diligence. But the fraud was so sophisticated that even major investors such as Temasek, SoftBank and others were deceived,” he said.

Tengku Zafrul also disputed claims that RM200 million had been lost, saying KWAP’s official figure was RM163.4 million.

He said KWAP had already explained that it was pursuing every available avenue to recover as much of the investment as possible, while undertaking a comprehensive internal review and strengthening its investment processes.

Among the measures announced by the fund, he said, were broader diversification of private market investments, greater use of experienced external fund managers, and enhanced post-investment monitoring.

He added that it was still too early to conclude that the entire investment had been written off, as recovery efforts remain ongoing.

Addressing concerns over the impact on civil servants’ pensions, Tengku Zafrul stressed that KWAP operates differently from the Employees Provident Fund (EPF).

He said the government remains responsible for paying pensions, while KWAP manages pension payments on its behalf and helps finance part of the government’s pension obligations.

“Civil servants do not have individual savings accounts in KWAP that are reduced when a single investment records a loss,” he said.

He also argued that the eFishery investment was too small to materially affect KWAP’s financial position.

According to Tengku Zafrul, KWAP generated about RM18 billion in investment income in 2024, making the RM163.4 million investment worth less than one per cent of that year’s investment returns.

He added that based on 2025 figures, KWAP manages approximately RM195 billion in assets, meaning the eFishery investment represented less than 0.1 per cent of the fund’s total assets.

“This means the eFishery case does not have a material impact on KWAP’s financial position or its ability to continue supporting the government’s pension obligations,” he said.

Nevertheless, Tengku Zafrul stressed that the size of the loss did not diminish the need for accountability because the investment involved public funds.

“RM163.4 million is still public money. Every sen that can be recovered must be pursued,” he said.

He said the findings of KWAP’s internal review had already been presented to its board and that follow-up action must proceed in accordance with established accountability processes.

“If there was negligence, those responsible must be held accountable,” he said.

Tengku Zafrul also rejected claims circulating online that KWAP was close to bankruptcy or would be unable to continue paying civil servants’ pensions.

He described such claims as false and urged the public to rely on the official facts surrounding the case.