Najib 'worried' about risks in FundMyHome, rebutted by idea's proponent Tong

PETALING JAYA: Former prime minister Datuk Seri Najib Tun Razak is "worried" that the Ministry of Finance may not have properly assessed the risks involved in FundMyHome, but he was rebutted by Datuk Tong Kooi Ong, the proposer of the idea.

Najib (pic, left) quoted Dr Mahathir's media advisor, Kadir Jasin, who had said that the roll out of FundMyHome, a peer-to-peer crowdfunding platform for first-time house buyers, had opened up the government to possible claims of cronyism.

Adding to the worry was that GLCs and the EPF can also invest in the scheme, he added. 

Since the scheme was first announced by the Finance Minister during Budget 2019, Najib cheekily asked if the Ministry is now under the influence of a “towkay”.

“There are even real estate experts who are also worried that the scheme will cause a sub-prime crisis that will wreck the country's economy,” alleged Najib.

The former prime minister stirred up the question if the Finance Minister is unaware of all the risks, or chose to ignore them for "certain reasons". 

Najib claimed that similar schemes in China have collapsed and destroyed many lives.

He said, “If not thoroughly reviewed, administered and implemented well, this will also happen in Malaysia. Do we want the same thing to happen in Malaysia?”

“I will not be silent if it involves the future of the country and the people.”

“No one should dare to persecute and victimise the people. I, Najib Razak will fight,” he declared boldly.

The scheme was launched by Prime Minister Tun Dr Mahathir Mohamad, together with Edge Media Group chairman Datuk Tong Kooi Ong (pic, right), who had proposed it.

Homebuyers will put down 20% of the property price, while the balance of 80% will be contributed by investors, which can be financial institutions or, in future, the public.

Kadir had said today (Nov 9) that while the Finance Minister can announce the scheme "as a policy", he argues that the right way was to request for proposals from as many parties as possible so that the government had many options to choose from.

He had added that "the real issue" with housing was affordability, not financing, as prices had skyrocketed while incomes had not. 

Kadir also suggested that technology be used to mass produce or "manufacture" affordable housing, as a one GLC was said to be experimenting with. 

In response to both Najib and Kadir, Tong clarified in The Edge's online portal that what the Finance Minister had announced was a scheme that still had to be approved by the Securities Commission (SC).

"I assume the SC is reviewing the rules and regulations, investors’ protection, possible mechanisms and so forth. 

"It will then proceed to issue a consultative paper as per their guidelines and all stakeholders will be consulted before any new guidelines governing the new P2P (peer-to-peer) framework are issued.

SC will then proceed to invite applications, review compliances before licenses are issued.

"The new Malaysia does not tolerate rent-seeking or monopolistic behaviours and I am sure this will be the case as well," underlined Tong.  (Rent seeking refers to the practice, often political, of getting money for not doing "real work" but for just giving approvals.)

He said FundMyHome was like all innovations that go through stages of perception; from “ridicule” to “debate” and finally to “ it was obvious”.

Tong added that FundMyHome involves no public money, concessions or government guarantees, and is just an additional possible solution over and above existing ones.

"For those who think they have better solutions, this launch and this innovation in no way impedes anyone else from doing and proposing what they have in mind.

"To those who say the way to make homes more affordable is to produce them at a lower price, I hope you can be successful too. We all share the same objective, to help fellow Malaysians have a roof over their heads that they can afford," he said.

"In the end, there will probably be many solutions with each complementing the other."

Tong added that he had considered the possible risk sub-prime crisis in future. 

But he insisted that argument was "dead wrong" as a sub-prime crisis was about overbearing debts while FundMyHome had the opposite effect – reducing debt (bank mortgages) by using equity from investors.