The prosecution has withdrawn charges against Khairuddin Abu Hassan and lawyer Matthias Chang for alleged financial sabotage for reports against 1MDB that they lodged overseas.

Deputy public prosecutor Awang Armadajaya Awang Mahmud said he has received instructions not to proceed with the case.

"Hence we apply for a discharge not amounting to an acquittal," Awang Armadajaya told the Sessions Court in Kuala Lumpur today.

He said the decision to withdraw was done in the interest of justice and based on the representation made by the accused.

He added that the prosecution decided to discontinue with the case under Section 254 of the Criminal Procedure Code.

Following this, the defendants' lawyers applied for an acquittal as the court cannot allow the charge to hang over their heads, as that would allow the prosecution to charge them again in future.

Khairuddin's lawyer Haniff Khatri Abdulla said his team would not object to the withdrawal of the charge but was concerned about the prosecution's application seeking a discharge not amounting to an acquittal.

“It is better we have an acquittal of the charge. My client was charged under Section 124L of the Penal Code for going overseas (to lodge the reports) which was considered a crime. We have written a proposal, not a representation letter, to inform that the charge was a nullity.

“This is because the charge did not show an offence, and hence, there are no grounds for the prosecution to institute the charge. The proceeding to have Khairuddin charged under Sosma [Security Offences (Special Measures) Act 2012] was mala fide or in bad faith,” he said.

Two months jail under Sosma

Due to the charge, Haniff said Khairuddin had to spend two months, between Sept 18, 2015 and Nov 18, 2015, in the Sungai Buloh prison while the went to the Court of Appeal and Federal Court.

He said he asked for an acquittal because the case had gone on for one and a half years and yet to see the calling of witnesses, and added that the court has the jurisdiction to grant such request.

“We do not want a discharge because 10 years from now, Khairuddin would be facing the same charge and the facts of going to those countries,” he said.

Chang's lawyer Zainur Zakaria said since the prosecution did not disclose the reasons for withdrawing or discontinuing the trial, an acquittal was warranted.

“The prosecution has not give any reasons why it is not proceeding with the trial. Is it because they do not have evidence or do not have witnesses. They must be ready after the Federal Court made its decision.

“We made the representation a long time ago on Feb 3 last year, and since then, the prosecution has continued to appeal for the charge to be under Sosma. If they are discontinuing, they should have informed us earlier and not now. This is a reason for granting an acquittal," he said.

Haniff then cited a case law on the court's jurisdiction to grant a full acquittal despite the prosecution wanting a discharge not amounting to an acquittal.

He argued that if the court could not grant an acquittal, the prosecution should at the very least give an undertaking (akujanji) that it would not prosecute again.

To this, Awang Armadajaya said the prosecution was not able to give such an undertaking or pledge.

He further said that it is not within the prosecution's control that the matter had taken almost two years, contending that the defendants also made various applications at the Court of Appeal.

Sessions judge Wan Mohd Norisham Wan Yaakob said he will decide tomorrow on the application for full acquittal of the two.

Today was initially fixed for the hearing of the charge against Khairuddin and Chang, after the High Court and Federal Court agreed that the charge did not fall under Sosma.

The two were held under Sosma for two months until the High Court in Kuala Lumpur ruled that the charge under Section 124L of the Penal Code for alleged sabotage on financial institutions should not fall under Sosma, which is an anti-terrorism law that prescribes preventive detention powers.

Hence, the court ordered the trial to be heard before the Sessions Court.

Prosecutors had claimed that Khairuddin and Chang had sabotaged Malaysia's financial and banking institutions by lodging police reports on the 1MDB scandal in Singapore, Hong Kong, France, 
Switzerland and the United Kingdom.