Political Financing Through Yayasan And Foundations, Corruption, And The Pursuit Of Power

Press Statement
12 April 2021 

When politics and business form a nexus, there are bound to be vulnerabilities where unscrupulous individuals use the system to enrich themselves, but the depths to which the system is tainted in Malaysia is shocking, especially when it involves organisations meant to be charitable and community- building. 

The Center to Combat Corruption and Cronyism (C4 Center) demands answers regarding the vulnerabilities inherent in foundations or “yayasan” being controlled by political parties being used as war chests during political campaigns, especially since little to no attention has been brought to this matter. 

“Foundations and Donations: Political Financing, Corruption, and the Pursuit of Power” is the title of the report launched by C4 Center today on political funding through donations in Malaysian politics, which features case studies involving prominent politicians such as Najib Razak, Ahmad Zahid Hamidi and Adnan Mansor. The report also explores the various methods politicians’ exerted control over such foundations, and raises questions about the nexus between policies and selective patronage. 

There needs to be answers on how foundations helmed or founded by politicians, including prime minister Muhyiddin Yassin and opposition leader Anwar Ibrahim, can be used to provide specific aid to the constituencies of said politicians, especially when established as charities or organisations meant to fund social and community programmes, or as a focal point for religious pursuits. 

Examples here include the TSM Charity Golf Foundation, which has accumulated more than RM27 mil in donations since its inception in 2003, and has channeled approximately RM24 mil to charitable projects. However, food donations were also made by the foundation in the name of Bersatu Hulu Selangor and Bersatu Lembah Pantai, which reflects a political agenda within the social cause. 

Another example is Yayasan Aman, founded by Anwar and helmed by his wife Wan Azizah Wan Izmail, which provided aid specifically to Port Dickson and Pandan, the constituencies of Anwar and Wan Azizah, respectively. 

Answers are also needed about how there can be vulnerabilities in the system when it comes to foundations where, by nature of the foundations being under the personal control of political persons, nepotism through family foundations as well as abuse of power can be used to circumvent rules, such as those regarding audits and filing financial reports. That this has gone unmentioned at all is a black mark against Malaysian politics. 

Ultimately, while there are indeed foundations that do proper charity work, and while political donations are a legitimate means of raising campaign funds, it is when the two intersect that things get murkier, as the vulnerability for quid pro quo arrangements exists, meaning the system itself is vulnerable to corruption by those in power. 

The full report on Foundations and Donations: Political Financing, Corruption, and the Pursuit of Power is available for download at c4center.org. 

Released by:
Center to Combat Corruption & Cronyism (C4 Center)

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