KUALA LUMPUR, July 20 — Prime Minister Datuk Seri Anwar Ibrahim today defended Retirement Fund Inc’s (KWAP) investment in Indonesian aquaculture technology startup eFishery, stating the losses should be viewed against the fund’s overall strong performance while pledging greater scrutiny of future investments.

Responding to questions in the Dewan Negara, Anwar, who is also finance minister, said KWAP’s RM163.4 million investment in eFishery had gone through a rigorous investment process involving professional fund managers, feasibility studies and approvals by its investment panel and board, without political interference.

He stressed that individual investment decisions were made independently by professionals and did not require the approval of the Finance Ministry.

“I chose to announce the investment because it involves public funds,” he said, referring to KWAP’s investment in the Indonesian startup, which is now embroiled in an alleged fraud involving its management.

“The individuals responsible are already in prison,” he said, adding that the case showed even experienced global investors could be deceived.

Anwar noted that KWAP was not alone in backing eFishery, pointing out that some of the world’s most prominent investment firms, including Singapore’s Temasek, Japan’s SoftBank, Sequoia Capital, Aqua-Spark, Abu Dhabi-based 42XFund and Indonesia’s Northstar, had also invested in the company.

While acknowledging the investment loss, Anwar urged lawmakers to assess KWAP’s performance in its entirety.

Anwar said the RM160 million loss from the eFishery investment should be viewed in the context of KWAP’s overall performance, noting that the fund recorded RM12.9 billion in net profit in 2024 and an increase of RM15.8 billion in its fund size.

He said KWAP recorded annual growth of 9.3 per cent and that its performance should be assessed holistically alongside its overall strategy and action plans.

He added that KWAP had also recorded annual compound growth of more than 8.5 per cent and continued investing in Malaysian startups under programmes such as Gear Up, including companies like LaPasar and ZUS Coffee.

Nevertheless, Anwar said the government supported investigations into the investment and had instructed KWAP and the Finance Ministry to cooperate fully with the Malaysian Anti-Corruption Commission (MACC).

“If there are elements of wrongdoing, the MACC must investigate. I have instructed that full cooperation be given,” he said, adding that preliminary information did not indicate misconduct by KWAP but the investment process should still be thoroughly examined.

Responding to concerns over whether sufficient due diligence had been carried out before the investment was approved, Anwar said KWAP’s investment panel comprised professionals, while representatives from the government sat only on the board and did not make investment decisions.

He said the eFishery investment had undergone multiple rounds of auditing by internationally recognised firms, yet the alleged fraud still went undetected.

“This is a lesson for us. Even if world-renowned auditors approve something, it is no guarantee of success,” he said.

Drawing parallels with the 1Malaysia Development Berhad (1MDB) scandal, Anwar noted that Goldman Sachs, despite its global reputation, had also been implicated in transactions linked to the sovereign wealth fund.

“It means we cannot rely entirely on auditors or experts. We must also look at values, governance and integrity,” he said.

On whether the government would tighten investment policies following the episode, Anwar said KWAP’s strong returns reflected the dedication and expertise of its management, but acknowledged the need to learn from the incident.

He said the alleged fraud appeared to have occurred despite investment decisions being made in accordance with international standards of transparency and accountability.

“Investment, especially in startups, always carries risks. There will be losses from time to time, but we will not compromise on corruption or leakages,” he said.

Anwar added that the government would continue reviewing its investment processes while allowing the MACC to examine both the investment process and the decisions made by KWAP’s investment panel. 

The Retirement Fund (Incorporated) (KWAP) confirmed on July 18 that it invested RM163.4 million in scandal-hit Indonesian aquaculture startup eFishery, saying it is pursuing all available avenues to recover the funds.

The public pension fund issued the statement following recent media reports on its investment in eFishery, whose former chief executive was convicted earlier this year over financial fraud.

KWAP said the broader eFishery case involved “deliberate financial manipulation and misrepresentation of the company’s financial reporting.”

It noted that eFishery co-founder and former chief executive Gibran Huzaifah was sentenced by the Bandung District Court on April 29 to nine years’ imprisonment after being convicted of embezzlement and money laundering.

The startup was once regarded as one of Indonesia’s leading agritech companies before allegations of accounting fraud unravelled its rapid rise and led to criminal proceedings against its former leadership.

KWAP disclosed that its total investment in eFishery amounted to RM163.4 million, representing about 2.51 per cent of the company’s shareholding.

It stressed that it was a minority shareholder and that the majority of eFishery’s shares were held by other investors, including major global institutional investors that were similarly affected by the misconduct.

* An earlier version of this article contained an error which has since been rectified.