KLANG: The first meeting of the new Selangor legislative assembly is about a month away but the recently-sworn in Pakatan Harapan state government is already under fire from state opposition parties.
The first salvo was aimed at the Selangor General Insurance Scheme (Insan) and its ewallet Wavpay, where detractors say the state government had breached laws concerning data protection and financial services.
Legal experts and the people behind the scheme refute these allegations, arguing that the laws make exemptions for government services.
The Insan scheme, under state investment arm Mentri Besar Incorporated (MBI) offers accident and injury coverage of up to RM10,000 to any Selangor resident aged between one month to 80 years.
Registration is done via the Wavpay ewallet app.
The Insan scheme as well as Wavpay are managed by Wavpay Fintech Holding Sdn Bhd which in turn has three companies – Wavpay Systems Sdn Bhd, Wavpay E-Commerce Sdn Bhd and Wavpay Credit Sdn Bhd.
MBI owns 49% shares in Wavpay Fintech Holding Sdn Bhd whilst the remaining 51% is owned by private entity CT Frank Technology (M) Sdn Bhd.
Wavpay Systems Sdn Bhd manages the state’s ewallet facility, Wavpay E-Commerce Sdn Bhd manages an emarket platform for vendors to sell their products and consumers to purchase the items on a flexi-payment arrangement.
Wavpay Credit Sdn Bhd is a licensed moneylender offering loans and financing.
One allegation is that the state government has illegally obtained personal data to register people for Insan with many being unaware that they have been insured.
This, the detractors said, violated the Personal Data Protection Act 2010 (PDPA).
Selangor Mentri Besar Datuk Seri Amirudin Shari clarified that the data was obtained from the Election Commission’s voters list which is a document that can be purchased by anyone.
He had added that the names were used to pre-register potential recipients for insurance coverage.
“Those who have been pre-registered would have to verify (their identities) by sending in a selfie with their identity cards,” Amirudin had told journalists recently.
But other allegations have come up, with Bersatu legal and constitution bureau deputy chairman Sasha Lyna Abdul Latif saying that the state had violated the Financial Services Act (FSA) 2013.
According to Sasha Lyana, anyone entering into a contract to acquire an insurance policy must be aware of the contract and acknowledge acceptance as well as know the identity of the insurance company.
“The policy had been issued to all the voters of Selangor without their knowledge, all the pre-contractual disclosures were not adhered to and it was also done without any offer or acceptance of the insurance contract.”
“The insurance scheme was never announced and the policy holders were never given the option to be offered the insurance scheme let alone accept the offer,’’ added Sasha Lyana.
This meant that the state had breached several provisions of the FSA, Sasha Lyana wrote in a statement recently.
Former Selangor exco member Datuk Teng Chang Khim has hit back, saying he was “appalled by her ignorance of the basic law of contracts”, in a social media post.
“The contracting parties here are the state government and the insurance company and not the insured who are the beneficiaries,’’ said Teng, a lawyer and chairman of Wavpay Fintech Holding.
When contacted, Teng said the agreement was between the insurance company and the state government, as it was the latter that buys and pays for the policies, and not the beneficiaries.
There are also allegations that Wavpay is conducting itself like a loan shark by offering loans through its app.
Wavpay offers deposits, remittance, cash loans and auto insurance services in addition to being a platform for users to buy furniture, home appliances and gadgets via hire purchase schemes.
Newly elected Semenyih assemblyman Nushi Mahfodz of PAS, wanted to know why money lending was included in the Wavpay Apps.
“We want to know why a licensed ‘Ah Long’ (money lender) has been incorporated into the state’s ewallet system as it is haram given the high interest rates,’’ said Nushi.
Teng said loan facilities were a common inclusion into ewallet facilities and most ewallet operators such as Touch ‘N’ Go and Shopee, also offered loans through their apps.
“We wanted a company which has an ewallet facility and bought one which also came with a money lending license incorporated into the ewallet,’’ said Teng.
He added that lawyers had advised the state to set-up a holding company and that is how Wavpay Fintech Holding came into being.
“The state government invested RM10mil into the holding company and all the three companies under the holding company have all the necessary licenses and permits,’’ he added.
He said Wavpay had a money lending license as it wanted to offer micro-credit to those who do not have the collateral to seek loans elsewhere and it only imposed an interest rate of 15% which is 3% lower than other lenders.
Teng also addressed allegations that the state had breached personal data laws saying that it was not illegal to buy electoral data from the EC.
“It’s open data with name, MyKad number and address which anyone can buy,’’ he said.
Constitutional and administrative law lecturer Prof Dr Nik Ahmad Kamal Nik Mahmood said from what had transpired, there was no breach of privacy.
“The Personal Data Protection Act prohibits the usage of an individual’s data for commercial purposes.
“However, there are exemptions allowing the data to be used for government purposes,’’ said Prof Dr Nik Ahmad Kamal who is also a member of the National Professors’ Council.
He added that the Selangor government needed the data to identify people who are eligible for the insurance scheme.
“How they went about this was to get the data from the EC’s list and in that context, the data was used to benefit the people,’’ he said.
