This article first appeared in The Edge Financial Daily on August 8, 2019

KUALA LUMPUR: The High Court yesterday set Sept 26 for the hearing of applications by the investors and the management company of the Golden Palm Growers scheme with regard to a bid to wind up the company.

The company, Golden Palm Growers Bhd (GPG), is seeking to be wound up, while the investors — or growers — have applied to intervene in the matter as additional defendants.

The investors have claimed that the scheme, which involves the investors pooling money for the operation of a plot of oil palm plantation land in Kelantan, is a Ponzi scheme.

The court room was packed with frustrated investors, mostly retirees, as well as some asset managers from overseas, expecting the hearing to begin yesterday.

After discussions in chambers between the lawyers and Judicial Commissioner Ong Chee Kwan, the growers seated in the public gallery were told by their counsel, Jerry Ling, that the hearing will only be on Sept 26.

“[GPG] has filed an application for the scheme to be wound down, based on the voters’ decision for it to be closed down. We (investors) can only intervene in that action as an intervener,” Ling told reporters later.

GPG in October 2017 held a general meeting where 98% of the growers voted in favour of giving the company one year to look for a suitable buyer for the Kelantan plantation, as opposed to an immediate sale to recover their capital.

In April this year, the company held another general meeting, at which the growers voted against granting an extended realisation period for the sale of the land to June 30, 2019, from the previous deadline of Jan 1, 2019.

Following this, GPG filed an application to the court to wind up the share farming scheme.

“They filed the application to wind up based on the voters’ decision that the scheme should be closed down,” Ling told reporters.

If the scheme is closed based on GPG’s application — that it was a valid and not an illegal scheme — the investors will get nothing.

“We are saying that it is an illegal scheme and that the scheme should be wound down and monies returned to the investors,” he said.

Ling added that the Companies Commission of Malaysia has also initiated investigations against GPG.

The investment scheme entails the pooling of the growers’ money to support oil palm-related operations at the Kelantan plantation, with GPG promising a return of 6% per annum during the first phase of the scheme, which was over a six-year period starting 2010.

Several growers told The Edge Financial Daily that they did receive the 6% payment for the first phase, but GPG seemed to have some difficulty in supporting the scheme in the seventh year.

“I invested about RM30,000 of my EPF (Employees Provident Fund) money in the first phase and I put in another RM90,000 for the second phase. And now I only have RM30,000 left in my EPF. I’m 70 and already retired. How am I going to live?” said an investor.

Meanwhile, an asset management fund from Japan was said to have invested some RM5 million in the scheme as well.

In total, the growers have invested a total of RM218.55 million in the scheme and got back only 6% of the amount or RM78.48 million in return for their investment.