Rakyat Corporation Berhad, a Bank Kerjasama Rakyat Berhad (Bank Rakyat) subsidiary co-operative, is under a liquidation probe after documents uncovered by Malaysiakini revealed that a winding up petition had been filed at the Kuala Lumpur High Court.

The Registrar of Companies' documents purportedly show that chairperson Syed Jalaludin Syed Salim and managing director Kamaruzaman Che Mat resigned from Rakyat Corporation on October 15, 2008.

The court appointed Gabriel Teo Chun as the provisional liquidator on June 17 to oversee the assets and businesses of Rakyat Corporation until it hears the winding up petition.

The directors of Bank Rakyat also sit on the Rakyat Corporation board.

thuraisingham shun cooperative story 120609 One Zainuddin Abdul Rahman, who was the former director-general of the (then) Co-operative Development Department, is among them.

Co-operative Consultant Shun Thuraisingham's ( left ) opinion the current board of directors should step down for being embroiled in too many controversies.

"Rakyat Corporation, headed by the stalwarts of Bank Rakyat co-operative, should consider vacating their seats. Bank Rakyat is known to be involved in legal tussles for fictitious loans.

No annual meeting in ages

"Bank Rakyat went into a loss as a result of the Tinju Dunia episode and it is also known that they have not held their annual general meeting for 15 years," he told Malaysiakini .

The probational liquidation of Rakyat Corporation raises so much doubt that the situation must be brought under control with proven actions. All the culprits must be brought to book to win back public confidence, he added.

The time is now ripe for the government to take a look at the private sector initiated proposals which have been forwarded to the prime minister, the (then) Ministry of Entrepreneur and Co-operative Development, the present Minister of Domestic Trade, Co-operative and Consumerism, Ministry of Women, Family and Community Development and the Ministry of Education, he said.

Rakyat Corporation has an authorised capital of RM20 million with an issued and paid up capital of RM11 million. It is also known they have borrowings amounting to RM19 million.

Audited accounts in 2007 show that Rakyat Corporation faced a RM37 million capital deficiency.

Kamaruzaman holds one share in the corporation and, Rakyat Hartanah Sdn Bhd, also another subsidiary Bank Rakyat, holds the rest.

Bank Rakyat has also been directed to resuscitate the Malay Officers Co-operative and Credit Society (MOCCIS), which ran up debts of RM78 million last year.

Bank Rakyat (formerly known as Bank Agong) is an amalgamation of a slew of banks set up in 1954 by individual co-operatives to provide financial services to help members expand their organisations.

The bank was unavailable to comment today.