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Day 19: Finance minister advised SRC to seek extra RM2b from KWAP - witness

Hidir Reduan and Hariz Mohd  |  Published:  |  Modified:

LIVE | The criminal trial of former prime minister Najib Abdul Razak involving the alleged misappropriation of funds from SRC International Sdn Bhd enters its 19th day today at the High Court in Kuala Lumpur.

Malaysiakini brings you live reports of the proceedings.

Summary of Najib’s SRC RM42 million case

Najib is facing 7 charges relating to RM42m involving SRC International, a former 1MDB subsidiary.

  • 1 abuse of power charge
  • 3 criminal breach of trust (CBT) charges
  • 3 money laundering charges
  • ClickTap to view infomation on judge, prosecution and defence team


KEY HIGHLIGHTS

  • Finance minister advised SRC to seek extra RM2b loan from KWAP - witness
  • KWAP panel 'unanimously agreed' to approve RM2b SRC loan 
  • KWAP heads informed Najib in person about reduced SRC loan
  • Defence accuses DPP of 'beating around the bush' on KWAP loan policy
  • KWAP ex-CEO testifies SRC loan bid didn't meet requirements
  • Najib's aide gave SRC loan bid to KWAP ex-CEO
  • 'SRC director confirmed RM143m deposited into Ihsan Perdana account'
  • I would've called Najib if I'd known accounts were his - witness
  • Judge orders defence to be more precise in cross-examining witness
  • Ihsan Perdana MD had 'big picture' talks with Najib 
  • Witness: I couldn't have given money to Najib even if I wanted to 
  • 'Ihsan Perdana's CSR work wasn't political'
  • A moment of humour over name change
  • Witness: Order to avoid conflict of interest came from 1MDB CEO, not Najib
  • Shafee in other courts, coming later, says Harvinderjit


Thank you for following Malaysiakini's live report

4pm - Thank you for following our live report today.

Reporting by Hariz Mohd and Hidir Reduan. Photographs by Azneal Ishak. Social media updates by Ewe Linq Yenn.

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3.57pm - Proceedings have been adjourned and will resume tomorrow at 9am. 


Finance minister advised SRC to seek extra RM2b loan from KWAP - witness

3.35pm - Former Retirement Fund Inc (KWAP) CEO Azian Mohd Noh testifies that the then-finance minister advised SRC International to seek an additional loan of RM2 billion.

Azian tells DPP Ishak Mohd Yusoff that the KWAP investment panel agreed to the additional RM2 billion application, as it was endorsed by the then-finance minister.

This was according to the minutes of a KWAP investment panel meeting dated March 22, 2012.

Najib Abdul Razak was the finance minister at the time, although this was not explicitly mentioned in Azian's testimony.

"In the meeting's minutes, it said that the finance minister had approved the application and advised SRC International to get an additional loan from KWAP, as KWAP had greenlit the earlier loan," Azian says.

SRC International was first granted an RM2 billion loan from KWAP in late 2011, followed by another RM2 billion loan in early 2012.


KWAP panel 'unanimously agreed' to approve RM2b SRC loan - witness

3.07pm - Former KWAP CEO Azian Mohd Noh testifies that the fund's special investment panel unanimously agreed to approve an RM2 billion loan to SRC International in August 2011.

“The investment circular (for the RM2 billion loan) was distributed to all investment panel members, and they agreed unanimously and returned their respective forms,” she says.

Azian was referring to the initial loan application by SRC International, which ultimately netted RM2 billion from KWAP for investment activities in natural resources.

She adds that the loan was approved as the risk was mitigated with a government guarantee.

The loan, Azian tells the court, was offered to 1MDB instead of SRC International, due to the former’s strategic importance and involvement in key investment projects. 1MDB was then meant to transfer the funds to SRC International. 


KWAP heads informed Najib in person about reduced SRC loan

2.45pm - Former Retirement Fund Inc (KWAP) CEO Azian Mohd Noh testifies that she and chairperson Wan Abdul Aziz Wan Abdullah visited the Prime Minister's Office in June 2011.

The purpose of the meeting was to inform then-prime minister Najib Abdul Razak about the KWAP investment panel's decision to only approve a loan of RM1 billion to SRC International, she says.

"One of the members of the investment panel, I don't remember which one, had opined that Najib should be informed about KWAP proposing to only approve an RM1 billion loan to SRC.

"After that, Dr Wan (Abdul Aziz) told me to follow him to meet Najib. We went to the PMO not long after that, and informed him about the decision by the KWAP investment panel.

"However, I do not remember the exact date of this meeting," she testifies.

To a question from DPP Mohd Ishak Yusoff, Azian says that the panel believed that Najib should be informed about the status of SRC International's loan application for RM3.95 billion.

Later, she also testifies that a special investment panel meeting was held by KWAP on July 19, 2011. 

At the meeting, she told the panel that Najib wanted the loan approval to be expedited, and that RM2 billion would suffice.

Azian says that she was ordered to make this announcement by Wan Abdul Aziz.

She adds that the special investment panel meeting decided to provide the RM2 billion loan to 1MDB instead of SRC International, on the condition that the loan was guaranteed by the government.

An alternative condition was for KWAP to approve the loan to the government, which in turn would lend the funds to SRC International. 


Defence accuses DPP of 'beating around the bush' on KWAP loan policy

2.30pm - The prosecution and defence clash over the former's line of questioning, which a lawyer of former premier Najib Abdul Razak accuses of “beating around the bush.”

It takes place during DPP Ishak Mohd Yusoff's examination-in-chief of former Retirement Fund Inc (KWAP) CEO, Azian Mohd Noh.

Ishak is asking the 38th witness why KWAP did not outright dismiss the investment paper that recommended a loan of RM1 billion to SRC International, instead of the RM3.95 billion initially sought by the former 1MDB subsidiary.

The decision for KWAP to postpone the decision and direct its fixed income department to seek further information from SRC International was made in a July 2011 meeting.

"At that time, why, despite not having enough information and not fulfilling the loan application policy (of SRC International's loan application), was this still being considered?" Ishak asks. 

Defence lawyer Harvinderjit Singh then interjects, saying: "I do not think my learned friend knows what he wants to establish. Instead of beating around the bush, he should be asking directly whether there was a direct breach of (KWAP) loan policy."

Ishak replies that he has his own way of asking questions. The DPP then continues his examination-in-chief of Azian.


KWAP ex-CEO testifies SRC loan bid didn't meet requirements

2.25pm - Former CEO of Retirement Fund Inc (KWAP) Azian Mohd Noh testifies that she did not reject SRC International's application letter outright when it was handed to her in June 2011, although it did not meet requirements.

During the examination-in-chief, she replies in the affirmative to DPP Ishak Mohd Yusoff's question that the letter had not met the fund’s requirements, including the fact that it was addressed to then-prime minister Najib Abdul Razak instead of KWAP.

She also tells the court that she had not been able to decipher the content at that point in time.

Ishak: The letter did not meet KWAP's requirements. Why didn't you reject the application when you met the late Azlin (Alias, then special officer to Najib)?

Azian: Of course it was impossible for me to decipher the content at the moment. So I bring back and show to my chairperson.


Najib's aide gave SRC loan bid to KWAP ex-CEO

2.15pm - The High Court hears that SRC International's loan application letter was handed over to then-CEO of Retirement Fund Inc (KWAP) Azian Mohd Noh (photo) in 2011 by a close aide to former prime minister Najib Abdul Razak.

In her testimony, Azian says that she was called to meet special officer to Najib, Azlin Alias, now deceased, at a hotel in KL Sentral in June 2011.

She went to the hotel in the evening after working hours, and met Azlin for about 45 minutes, during which Azlin handed her the application letter.

Azian testifies that the letter, dated June 3, 2011, was signed by SRC International director Nik Faisal Ariff Kamil, and that it also contained a handwritten note by Najib that said "Bersetuju dengan cadangan ini (Agree with this proposal)".

Under examination-in-chief by DPP Ishak Mohd Yusoff, the 38th prosecution witness adds that she later took the letter and showed it to KWAP chairperson Wan Abdul Aziz Wan Abdullah, who ordered KWAP to study the loan application and for its investment panel to deliberate on it.


1.47pm - Proceedings resume with the calling of the 38th witness, former Retirement Fund Inc (KWAP) CEO Azian Mohd Noh for examination-in-chief.


12.45pm - Proceedings break for lunch. It is understood that the trial will resume at 1.30pm.


'SRC director confirmed RM143m deposited into Ihsan Perdana account'

12.40pm - A witness tells the High Court that SRC International's then-director Nik Faisal Ariff Kamil admitted that a total of RM143 million deposited into Ihsan Perdana Sdn Bhd's account came from the 1MDB subsidiary.

Ihsan Perdana managing director Dr Shamsul Anwar Sulaiman testifies that Nik Faisal had told him this when confronted through a phone call regarding the origin of the funds.

Shamsul tells the court that he initially only knew about the monies' origin from the media.

He had subsequently been arrested by the authorities over the case soon after arriving from Belgium on July 1, 2015, before he could contact Nik Faisal.

He then called Nik Faisal after he was released from police remand.

"So I just came out from my remand period, he (Nik Faisal) said the money was from SRC.

"The conversation was short and brief," said Shamsul.


I would've called Najib if I'd known accounts were his - witness

11.40am - Ihsan Perdana managing director Shamsul Anwar Sulaiman testifies that he would have called Najib Abdul Razak (photo) if he had known that the two accounts to which he authorised an RM42 million remittance had belonged to the then-prime minister.

The 37th witness tells defence lawyer Harvinderjit Singh this during cross-examination.

Earlier in the proceedings, Shamsul had claimed that he had a direct line of communication to Najib at that time which allowed the witness to call the then premier directly about any issue.

Harvinderjit: If you had an inkling that the two accounts (AmIslamic 880 and 906) belonged to the sitting prime minister, and you then had direct access to him, you would have called him?

Shamsul: Yes, I would have if I had known (the two accounts belonged to Najib).

In Shamsul's witness statement, he said that he had tried to find out whom the two bank accounts belonged to, but was rebuffed by AmBank.


Judge orders defence to be more precise in cross-examining witness

11.10am - Justice Mohd Nazlan Mohd Ghazali tells defence counsel Harvinderjit Singh to be more precise in his line of questioning when cross-examining the prosecution's 37th witness, Dr Shamsul Anwar Sulaiman of Ihsan Perdana Sdn Bhd.

This comes after DPP V Sithambaram objects to how the lawyer is conducting the cross-examination, alleging that Harvinderjit had gone into too much detail regarding issues which were "irrelevant" to charges faced by former premier Najib Abdul Razak.

"This had been going on for some time, and we feel that this has nothing to do with charges against the accused.

"I feel they are totally remote from the charges. Perhaps my lord can hear from my learned friend here (Harvinderjit) and make a ruling," Sithambaram (photo) said.

The interjection came as Harvinderjit was scrutinising a portion of Shamsul's witness statement, which detailed the nature of Ihsan Perdana's works and projects, and its financial statements.

In his defence, Harvinderjit then told the court that he was deliberating on matters that the witness had testified on.

"I can do better to determine the relevancy of this. Refer to witness statement paragraph 43 on the list of projects and the general election, (the witness) spoken about a list of projects.

"The provision of financial statements was already outlined in witness statement. I am deliberating on that," he said.

To this, Sithambaram rises from his seat again and says that what Harvinderjit was asking and going into detail about was not the subject matter of the charge.

Instead, he said, Harvinderjit’s focus only comprised the introductory part of the witness statement where Shamsul had testified about the nature of his company's business.

Justice Mohd Nazlan then asked Harvinderjit if there was more relevance to his line of questioning.

Nazlan: Beyond that, how is it relevant?

Harvinderjit: I want to determine (his) state of knowledge of the company. Some areas of witness statement suggest the CSR projects were for BN areas only. Perhaps it is not directly relevant, but it is still relevant; if this is not in the witness statement, I will not touch it. We have heard (about projects in) Kelantan, we have heard about Penang.

The judge then rules that he will allow Harvinderjit’s questions, but that he must be precise.


Ihsan Perdana MD had 'big picture' talks with Najib 

10.55am - Ihsan Perdana managing director Shamsul Anwar Sulaiman testifies that he had "big picture" discussions with then-prime minister Najib Abdul Razak about the corporate social responsibility work done by Ihsan Perdana.

During cross-examination by lawyer Harvinderjit Singh (photo), the 37th witness says that he never discussed 1MDB grant money with Najib during this time.

Harvinderjit: There were big-picture discussions that you had with Najib, the main agenda being to update him on (CSR) projects you were doing and get his input on what is needed in terms of CSR necessity?

Shamsul: Yes.

Harvinderjit: How about the issue of grant money with Najib?

Shamsul: No.

When asked by Harvinderjit, Shamsul confirms that the issue of grant money for Ihsan Perdana was only discussed with 1MDB and Yayasan Rakyat 1Malaysia (YR1M). 


Witness: I couldn't have given money to Najib even if I wanted to 

10.30am - Ihsan Perdana Sdn Bhd managing director Dr Shamsul Anwar Sulaiman testifies that he could not have transferred any money from the company to former premier Najib Abdul Razak's bank accounts even if he had wanted to.

He tells the court this when answering a series of questions posed by defence counsel Harvinderjit Singh under cross-examination this morning.

Shamsul says that he is responsible for the grants that Ihsan Perdana received from 1MDB and Yayasan Rakyat 1Malaysia to conduct CSR projects for them.

Harvinderjit: None of the grant money went to Najib's account?

Shamsul: No.

Harvinderjit: If they told you to take the amount and put in (his) accounts, would you have done it?

Shamsul: It would depend on who is telling me to do so.

Harvinderjit: Who is responsible for the grant money?

Shamsul: I am.

Harvinderjit: You couldn’t give it to the prime minister even if you wanted to?

Shamsul: Yes (I couldn't).

The court then goes for a short break.


'Ihsan Perdana's CSR work wasn't political'

10.25am - Ihsan Perdana managing director Dr Shamsul Anwar Sulaiman denies that the company’s CSR work was conducted for political purposes.

The 37th witness tells this to defence lawyer Harvinderjit Singh during cross-examination.

Harvinderjit then refers to one of the letters from 1MDB to Ihsan Perdana providing a grant to the latter, which stated that the grant was given on the condition that it was not used for political purposes.

Harvinderjit: Your CSR projects, these are political activities?

Shamsul: No.

Harvinderjit: They are CSR activities?

Shamsul: Yes.

Shamsul also explains that the letter from 1MDB states that the grant was for the Mesra Rakyat project, which was to help people in rural areas access clean water and proper toilets, as well as help poor schoolchildren obtain books, among others.


A moment of humour over name change

9.45am - A moment of humour in the usually sombre SRC International trial when Ihsan Perdana Sdn Bhd managing director Dr Shamsul Anwar Sulaiman explains why the 1MDB CSR partner changed its name from Gem Horizon Sdn Bhd to Ihsan Perdana.

During cross-examination by lawyer Harvinderjit Singh, the 37th witness explains that the name change was done in order to make it sound "catchy". His reply elicits chuckles from the public gallery.

Harvinderjit: Why did you change the name from Gem (Horizon) to Ihsan (Perdana)?

Shamsul: We needed something catchy to do (CSR) business. Ihsan is (akin to) charity. If use Gem, it would sound like we were selling gems.

Harvinderjit: You did not want people to think you were a jeweller?

Shamsul: Yes (laughter).


Witness: Order to avoid conflict of interest came from 1MDB CEO, not Najib

9.40am - Ihsan Perdana managing director Dr Shamsul Anwar Sulaiman testifies that then prime minister Najib Abdul Razak was not the person who told him to start Ihsan Perdana in order to avoid conflict of interest with 1MDB.

The 37th witness tells lawyer Harvinderjit Singh this during cross-examination.

Harvinderjit: Regarding the starting of an independent vehicle (Ihsan Perdana), that came from (then 1MDB CEO) Shahrol (Azral Ibrahim Halmi) and not from Najib?

Shamsul: Yes.

Harvinderjit: Shahrol told you to start the independent vehicle, he explained in order to avoid conflict of interest?

Shamsul: Yes, it is difficult to transfer money (to Ihsan Perdana for the purposes of CSR work) otherwise, (to do) bookkeeping (and) transferring money to the contractor.

Previously in his witness statement, Shamsul testified that he was directed to start Ihsan Perdana in order for it to be 1MDB's CSR partner. 


9.20am - 37th witness Dr Shamsul Anwar Sulaiman identifies three other witnesses during proceedings.

They are ex-1MDB CEO Shahrol Azral Ibrahim Halmi, former Armed Forces Fund Board (LTAT) CEO Lodin Wok Kamaruddin (photo), and Ihsan Perdana's finance director Abdul Aziz Ismail.


Shafee in other courts, coming later, says Harvinderjit

9.17am - Lawyer Harvinderjit Singh informs the court that Najib Abdul Razak's defence counsel Muhammad Shafee Abdullah will only be able to come into proceedings later today as he has a few court matters at the Palace of Justice in Putrajaya to attend to this morning.

Harvinderjit says that firstly, Shafee needs to handle the Court of Appeal hearing where the prosecution is appealing to set aside the bail granted to Umno's Jamal Mohd Yunos in his court case.

The lawyer also informs High Court judge Mohd Nazlan Mohd Ghazali that Shafee also has a Federal Court matter at 12pm in regards to Samirah Muzaffar's appeal to be granted bail in the murder case of Cradle Fund CEO Nazrin Hassan.

"After the 12pm proceedings, then Shafee could come to court here," Harvinderjit explains.


9.13am - Najib Abdul Razak enters the dock as proceedings begin.


9.05am - Clad in dark blue suit, accused Najib Abdul Razak enters the courtroom and takes a seat at the front row of the public gallery to await the beginning of proceedings.

The former premier's lawyer Harvinderjit Singh and other members of the defence team are seen at the front of the court, preparing documents for the trial.

DPP Muhammad Saifuddin Hashim Musaimi and other members of the prosecution team are seen conferring in front of the court.


As Najib Abdul Razak's RM42 million SRC International trial enters its 19th day today, Ihsan Perdana Sdn Bhd's managing director Dr Shamsul Anwar Sulaiman will resume his testimony under cross-examination over his key role in transferring RM42 million to the personal bank accounts of the former prime minister.

With cross-examination before Kuala Lumpur High Court judge Mohd Nazlan Mohd Ghazali expected to begin around 9am, 37th witness Shamsul will continue his oral evidence on where he left off two weeks ago.

On May 15, the long-time medical practitioner testified that his history of voluntary participation in charity work led to Najib roping in the witness to become 1Malaysia Development Bhd's (1MDB) executive director in 2010 to work on corporate social responsibility (CSR) programmes.

Shamsul, who was at one point Sungai Siput Umno division chief, told the court that he had known Najib since the late 1980s when the latter was Umno Youth chief and had been fraternising with party leaders and members during charity work.

He testified on how eventually 1MDB would ask him to leave and set up his own company, Ihsan Perdana, in order to avoid a potential conflict of interest while being engaged by 1MDB for CSR work.

He pointed to the appointment of Ihsan Perdana as SRC International's CSR partner, courtesy of a letter dated Sept 3, 2014, signed by SRC International's directors Suboh Md Yassin and Nik Faisal Ariff Kamil - the two recurring characters in various other testimonies over the course of the trial.

SRC International was a subsidiary of 1MDB.

Shamsul told the court how he had - between December 2014 and February 2015 - authorised the remittance of RM42 million from Ihsan Perdana to two AmIslamic accounts, whom he claimed he did not know belonged to Najib at the time, and that if he had known this, he would not have authorised the transfer.

He also testified how he was detained for four days by the MACC in 2015 as part of a probe into Ihsan Perdana's transactions.


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