Former MCA president Dr Ling Liong Sik said there is no legitimate reason for SRC International Sdn Bhd, a former subsidiary of 1MDB, to channel an extraordinary sum of RM42 million into Prime Minister Najib Abdul Razak's personal bank accounts.

Ling in his defence statement and counter-claim filed today over Najib's suit for alleged defamatory statements, said the transfer occurred sometime between December 2014 and February 2015.

He said SRC, incorporated on Jan 7, 2011 was formerly controlled by 1MDB but is now owned by Najib's Finance Ministry.

SRC owns 998 shares out of the total paid-up capital of 1,000 shares of Gandingan Mentari Sdn Bhd, he said.

“There is no legitimate reason why SRC had caused to channel any money, let alone the extraordinarily large sum of RM42 million into the plaintiff's personal bank accounts.

“There is no reason for Najib to personally receive such an extraordinarily large sum into his personal accounts.

“Therefore at the very least, Najib has created a public perception that the transfer was not for legitimate purposes and that Najib was not honest and transparent,” he said.

Fair comment

Ling, who is formerly transport minister, also pleaded fair comment and qualified privileges in his defence, which he filed today.

The former MCA president also in his counter-claim against the PM said if Najib cared about his reputation, then he ought to institute legal action against all the Umno leaders past and present that have criticised him.

This includes former premier Dr Mahathir Mohamad, US daily the Wall Street Journal and whistleblower website Sarawak Report .

Pleading justification as his defence, Ling said with regards to the US$700 (RM2.6 billion) alleged donation, Ling said the admission was made by Najib's deputy in Umno, Muhyiddin Yassin, and Umno divisional leaders and office-bearers including Umno secretary-general Tengku Adnan Tengku Mansor and Umno treasurer Ahmad Husni Hanadzlah.

“Najib failed to disclose the exact source of the funds channelled into his personal accounts. Muhyiddin had professed of being ignorant of the Middle East donor.

“Accepting such large sums of money for political funding just prior to the May 2013 elections would create at the very least a perception in the eyes of the general public, that Najib was commonly involved in “money politics”, in that he was using the money to ensure the BN government would win and he remains as PM.

“Four months after the Sarawak Report (article), Najib had on Dec 8, this year admitted that he received the RM2.6 billion as a donation. He explained that the donation was made to him personally and as such the donation was deposited into his personal accounts.

“If the US$700 million was indeed a donation, the donation could only be meant for Umno. He (Najib) had breached Article 26.2 and Article 27.2 of Umno's constitution as the donation should have been kept in Bank Perdagangan or Bank Simpanan or held under an Umno trustee,” he said.

'Unfit to be PM'

Ling further claimed that Umno's financial statements for the year 2013 and 2014 did not capture the purported RM2.6 billion donation.

This, he contended, create serious doubts that the money was indeed meant as a donation to Umno.

“The alleged donation was made on March 2013, two months before the 13th general election into his personal account. Najib had created a public perception that he was not honest and transparent and was involved in money politics.

“Following the actions with regard to the RM2.6 billion and SRC RM42 million, Najib had acted improperly and wrongly and is therefore unfit to be Malaysia's PM,” the former MCA president said.

Najib filed the suit against Ling on Oct 27, following the former transport minister's call for the Umno president to stop leading the country .

The Umno president complained that the words uttered by Ling meant that he had abused his powers, was not qualified to be the leader of the government, that he was involved in a scandalous or financial conspiracy, and that he was not fit to be the BN chairperson.

Najib's lawyer Mohd Hafarizam Harun confirmed that his firm has received a copy of the defence. The defence was filed by the firm of Ranjit Singh and Yeoh before the deadline tomorrow.

Full defence and counterclaim documents below: