KUALA LUMPUR: The Ministry of Finance (MOF) has found that the Retirement Fund (Incorporated) (KWAP) was deceived about its investment in eFishery and that it was a well-planned fraud.
The ministry said that the Indonesian aquaculture startup's management had manipulated its financial statements.
"Following the discovery, the consortium of investors, including KWAP, has taken firm measures, including legal action, fund recovery efforts, internal governance reviews and strengthened controls," the MOF said in a written reply published on Parliament's website today.
The consortium, including KWAP, has lodged a report with relevant authorities, initiated the appropriate legal action and is continuing to make every effort to recover the investment funds,
The MOF said KWAP had also conducted a comprehensive review of its investment evaluation, approval and monitoring processes, with the findings presented to its board for detailed scrutiny and discussion.
Following the deliberations, appropriate follow-up actions were taken in line with the institution's governance framework and accountability principles, it said.
The ministry said this in response to a question from Wong Chen (PH-Subang) on the action taken against KWAP's board members, Investment Panel and senior management over the approval and monitoring of the investment in eFishery, which resulted in significant losses involving the retirement funds of civil servants.
The MOF said KWAP has a sound and transparent investment governance framework, with all investments -- including direct investments in private markets -- undergoing a comprehensive evaluation, approval and monitoring process in line with its investment policies and mandate.
The process includes internal assessments, independent due diligence, and reviews of financial, legal and operational aspects before any investment proposal is approved.
"On the eFishery investment, the decision was made through established due diligence and governance processes based on information available at the time, including audited financial statements verified by internationally accredited auditors.
"At the same time, the consortium, including KWAP, had also conducted independent due diligence to ensure all information was complete and credible before approving the investment," it said.
The eFishery investment also involved several leading international institutional investors and technology funds, including Temasek, SoftBank, 42XFund and Northstar, all with their own internationally recognised investment assessment, governance and control processes.
The MOF emphasised that KWAP remains committed to managing civil servants' retirement funds with transparency, integrity and accountability, adding that improvements have been implemented to strengthen safeguards for future investments.
Last month it was reported that eFishery, an Indonesia’s start-up, has suspended its chief executive officer, Gibran Huzaifah, and chief product officer, Chrisna Aditya, pending an investigation into alleged financial irregularities in the company.
Gibran and Chrisna each held about nine percent of the company’s shares.
Last Tuesday, Bloomberg reported that a preliminary, ongoing probe into the agritech start-up estimated that it may have inflated revenue by almost US$600 million in the nine months to September last year.
The investigation, commissioned by its board of directors, also found that the start-up had presented to investors a US$16 million profit for the first nine months of 2024 when it actually generated a US$35.4 million loss.
eFishery was co-founded by Gibran and Chrisna in 2013 and had since grown to have a valuation of US$1.4 billion.
In 2023, the company was reported to have secured US$200 million from its Series D Funding round, making it Indonesia’s latest unicorn.
Of this sum, US$47.7 million (RM200 million) was from KWAP, according to DealStreetAsia.
This amount was in addition to investments from others such as Japan’s SoftBank Group Corp, Singapore’s Temasek and eFishery’s largest shareholder, Aqua-Spark. - Bernama
