The Employees Provident Fund should explain its investment policy of 'haram' and 'halal' to its 10 million contributors in the spirit of transparency and accountability, an opposition leader said today.

"EPF chairman Halim Ali should explain why its members and trade unions in the country were not consulted before this new investment policy was decided," said DAP national chairman Lim Kit Siang.

Deputy Finance Minister Chan Kong Choy revealed to parliamentarians last Wednesday that EPF categorised its investments as 'halal' and 'haram' and had ventured into companies producing cigarettes, alcohol and gambling.

The companies are British American Tobacco, Genting Resorts World and Guinness Anchor.

"EPF invested into these companies due to their high-dividend potential and high profit margins," said Chan.

The minister, however, gave assurances that EPF, which falls under its purview would not continuing such 'haram' investments in the future when the economy improves.

EPF bought RM501 million worth of shares in British American Tobacco on Feb 28, RM38 million in Genting on April 20, and RM4.3 million in Guinness Anchor on Sept 11.

Panel to decide

On Sunday, EPF announced that it would hire a panel of Syariah advisers to ensure that its investments would be in line with Islamic law.

The panel includes Federal Territory mufti Md Hashim Yahya, chief justice of Syariah Courts and director general of the Syariah Department Sheikh Ghazali Abdul Rahman, and International Islamic University's Post-graduate Centre dean Dr Mohd Daud Bakar.

Lim also argued that EPF contributors should be given the choice whether to invest in the so-called 'haram' stocks.

"EPF should be mindful of its statutory duty to ensure that contributions are invested to give the contributors optimum returns. And in this regard the contributors are entitled to their right of choice," Lim said.

EPF currently has RM40billion worth of investment portfolios.

The pension fund has received severe public criticism for investing in non-profitable companies resulting in the fund registering 'unrealised losses' of about RM750 million last year. The fund was also heavily criticised by opposition parties and unions when it bought over Timedot.com shares which were 75 percent under-subscribed.