HRD Corp Suspends Executives Amidst Levy & Procurement Investigation

KUALA LUMPUR February 6, 2026 – In a swift move signaling a commitment to greater accountability, the Human Resource Development Corporation (HRD Corp) has suspended three members of its top management pending an internal investigation. The action, taken barely two weeks after Datuk Mohamed Shamir Abdul Aziz assumed the role of CEO, follows reports from the Public Accounts Committee (PAC), the Auditor-General, and the Malaysian Anti-Corruption Commission (MACC).

The suspensions relate to a range of concerns, including the management of unutilised levy funds, the acquisition of the Menara Ikhlas building, HRD Corp’s equity investment practices, and a stalled New Core System (NCS) project. The NCS procurement, valued at RM14 million, has been delayed for over four years after failing User Acceptance Tests on three separate occasions, according to a statement released by HRD Corp on Friday.

While the names of the suspended executives have not been publicly disclosed, the move underscores a broader effort to reform governance within the organization. Datuk Shamir Aziz emphasized that the measures align with the vision of Human Resources Minister Datuk Seri R. Ramanan Ramakrishnan, who has called for increased integrity, transparency, and accountability across all workforce institutions.

“This is to ensure that HRD Corp’s stewardship translates into real, measurable outcomes for employers and Malaysian workers,” Shamir stated. The internal investigation will be comprehensive, encompassing a review of documents, financial records, approvals, meeting minutes, and audit trails. HRD Corp has pledged to adhere to principles of natural justice and maintain confidentiality throughout the process.

The swiftness of the action suggests a determination to address past shortcomings and rebuild public trust. Within his first week in office, Shamir secured approximately 18% settlement of outstanding structured investment portfolio, amounting to RM151.8 million, demonstrating early progress in recovery efforts. This initial success, however, is framed within a larger context of systemic issues that the investigation aims to uncover and rectify.

Beyond the immediate investigation, HRD Corp is implementing new procedural safeguards to prevent similar issues from arising in the future. A key change involves a revised timeline for approved training programs. Previously, programs could commence with significant delays in oversight. Now, approved training programs will be required to begin within 21 days to three months of approval, providing sufficient time for employers and providers to prepare and ensuring adequate oversight.

To further strengthen compliance and monitoring, HRD Corp will deploy officers to directly oversee the implementation of programs on-site. This direct oversight is intended to address governance gaps identified in previous reports, including instances of programs being conducted before receiving formal approval and a lack of consistent monitoring.

The issues facing HRD Corp are not isolated incidents. The organization plays a crucial role in Malaysia’s human capital development, managing levy funds collected from employers to support workforce training and skills upgrading. Concerns over the management of these funds, as highlighted by the PAC and the Auditor-General, raise questions about the effective allocation of resources and the potential for misuse.

The acquisition of Menara Ikhlas, a commercial building, has also come under scrutiny. Details surrounding the purchase remain limited, but the MACC’s involvement suggests potential irregularities in the procurement process. Similarly, HRD Corp’s equity investment practices are being examined to ensure they align with the organization’s mandate and are conducted with due diligence.

The stalled NCS project represents a significant financial loss and a setback for HRD Corp’s efforts to modernize its operations. The repeated failure of User Acceptance Tests indicates fundamental flaws in the system’s design or implementation. The RM14 million investment is now at risk, and the delay has hampered HRD Corp’s ability to efficiently manage training programs and track workforce development initiatives.

The current reforms at HRD Corp are being closely watched by stakeholders, including employers, training providers, and government officials. The success of these efforts will be critical in restoring confidence in the organization and ensuring that it effectively fulfills its mandate to support Malaysia’s workforce development goals. The emphasis on transparency, accountability, and internal controls signals a clear departure from past practices and a commitment to a more robust governance framework.

The investigation’s findings and the subsequent actions taken by HRD Corp are likely to have broader implications for governance and accountability within other Malaysian government agencies. The case serves as a reminder of the importance of strong internal controls, independent oversight, and a commitment to ethical conduct in the management of public funds.