Court orders Najib to enter defence for all seven SRC charges
SRC TRIAL | The High Court has ordered former prime minister Najib Razak to defend himself against all seven charges in relation to SRC International Sdn Bhd.
On the first charge for abuse of power, judge Mohd Nazlan Mohd Ghazali ruled that Najib played a role in SRC International's RM4 billion loan from Retirement Fund Incorporated (KWAP) in 2011...
SRC TRIAL | The High Court has ordered former prime minister Najib Razak to defend himself against all seven charges in relation to SRC International Sdn Bhd.
On the first charge for abuse of power, judge Mohd Nazlan Mohd Ghazali ruled that Najib played a role in SRC International's RM4 billion loan from Retirement Fund Incorporated (KWAP), a statutory body which manages the pension scheme for public employees, in 2011.
The judge also ruled that Najib later used RM42 million from SRC International for his own advantage.
"Case law authorities have also held that a series of acts, which are separated by intervals of time, could still be held to have formed one transaction and deemed connected through being done with one specific criminal intent in the pursuit of a continuous plot,” Nazlan ruled.
"The starting point is the establishment of SRC in 2011, which provides the overall context on the existence of a premeditated scheme.
“The accused’s participation in cabinet meetings in 2011 and 2012 was the act which amounts to the abuse of position, which was for the purpose of obtaining financial gratification, which materialised when the RM42 million was received by him in late 2011 and early 2012," the judge said.
If found guilty under Section 23 of the MACC Act 2009, Najib faces a maximum 20-year jail term and a fine five times the value of the gratification.
Referring to the approval for government guarantee for a total of RM4 billion in loans from KWAP to SRC in Aug 2011 and Feb 2012, Nazlan noted that the events leading up to the approval cannot be construed as purely being a lawful exercise of Najib’s then official duties as either prime minister, finance minister, or adviser of SRC.
It was beyond the ordinary and outside the usual conduct or involvement expected of a prime minister of finance minister, said the judge.
“Such conduct and involvement by the accused instead serves only to demonstrate the existence of private and personal interest on the part of the accused in SRC, which interest, in my judgment, is in the nature that is envisaged under the law to fall within the ambit of Section 23 of the MACC Act,”
The judge noted that despite Najib as then prime minister taking part and even chaired cabinet decision-making meetings, where two government guarantees were approved for the total RM4 billion loans by KWAP to SRC, there was no disclosure let alone any attempt by the accused to excuse himself from the deliberation of the meetings.
“The said RM4 billion loans would not have been approved by KWAP Investment Panel if not for the government guarantees," Nazlan said.
"The accused knew or ought to have known the conflict between his public duty as the prime minister and finance minister in SRC on the one hand and on the other his own private albeit secret interest in SRC which applied for the government guarantees.”
Nazlan added that the interest of the accused in SRC must be seen in the correct context, which was from the time of the establishment of SRC on Jan 7, 2011 to the approval of the applications for loans by SRC from KWAP (on July 19, 2011 and March 20, 2012). The accused's interest in SRC were guaranteed by the government (approved by the cabinet on Aug 17, 2011, and Feb 8, 2012) until the time the monies being the property of SRC in the amount of RM42 million were deposited in bank accounts of the accused.
The judge noted that given Najib’s control over SRC, the accused could cause the transfer of the company’s funds in three transactions totalling RM42 million through intermediary companies and credited into his personal accounts at AmBank, which were utilised and expended for his own advantage.
"A series of acts separated by the interval of time can amount to one transaction in continuation of a single plot.
"The establishment of SRC in 2011 sowed the context of the scheme. (The accused's) act amounts to an abuse of position which materialised when RM42 million was received by him in 2011 and 2012," ruled the judge.
On the three charges for criminal breach of trust, the judge ruled that the accused was not entitled to the RM42 million deposited in his account.
"The RM42 million transferred into the accused's account is wrongful gain by the accused and utilised for personal purposes (whereby) personal cheques amounting to RM10.7 million (were issued) and confirmed by the payees."
At the material time, SRC International was a subsidiary of 1MDB. Subsequently, it was transferred to the Ministry of Finance (MoF) Inc. Najib was also the former finance minister.
If found guilty under Section 409 of the Penal Code, Najib, for each charge, can be jailed up to 20 years and fined. The minimum jail sentence is two years.
On the three money-laundering charges, Nazlan ordered the accused to enter defence by ruling that the RM42 million proceeds originated from unlawful activity, as established in the charges.
"Accordingly, when the RM42 million finally flowed into the accused's accounts, the said funds could be construed as proceeds of unlawful activity," said the judge.
In respect of the element of knowledge, Nazlan finds that Najib knew that the RM42 million was proceeds of unlawful activity.
"The accused failed to take reasonable steps to ascertain whether or not the RM42 million was the proceeds of unlawful activity.
“This would include the sheer volume and frequency of transactions in the three bank accounts of the accused, the absence of any evidence of inquiries made by the accused, let alone any police reports or complaints to the bank,” Nazlan said.
"As such, all ingredients of the money-laundering offence under Section 4 (1) (b) of the (Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities) Act (2001) in all three charges have been proven," ruled the judge.
If found guilty under Section 4(1)(b) of the Act, Najib can be jailed up to 15 years, fined up to RM5 million or five times the amount involved for each charge.
"A prima facie case has therefore been made out against the accused in respect of each of the single charge of use of position for gratification, the three CBT charges and the three money-laundering charges within the meaning of Section 180 of the Criminal Procedure Code.
"As such, l now call upon the accused to enter his defence to all seven charges," Nazlan issued the order to Najib, who looked calm in the dock.
When an interpreter told him that he has three options in relation to the defence stage of the trial, Najib answered that he chose to give a sworn statement from the witness stand.
The three options given to an accused for the defence stage of a criminal trial are to either give a sworn statement from the witness stand which would open the accused to being cross-examined by the prosecution; given an unsworn statement from the dock which bars the prosecution from cross-examining the accused; or to remain silent.
Also present in the public gallery during proceedings were his daughter Nooryana Najwa, opposition leader Ismail Sabri Yaakob, and MIC deputy president M Saravanan.
Najib’s lead defence counsel Muhammad Shafee Abdullah informed the court that they had filed an application to obtain from the prosecution a list of people who have statements to the MACC and the police but was not called to testify in the prosecution stage of the SRC trial, nor even offered to the defence for the defence stage of the trial.
Shafee also said that as part of the application, the defence also seeks for the prosecution to provide to the defence copies of the said statements of these witnesses, among others.
Lead prosecutor V Sithambaram informed the court that the prosecution would object to the said bid by the defence.
Nazlan then fixed this Friday at 2.45pm to hear the defence’s application as well as the objection by the prosecution.
The judge allowed Shafee’s application for Najib’s attendance be dispensed with from the Friday proceedings, as the accused has a political matter to attend in Johor on that day, which is understood to be linked to the Tanjung Piai by-election.
Shafee also informed the court that the defence has filed several ex-parte (without the other side being present) applications to cite several individuals and institutions for contempt of court. However, he did not reveal who there are.
It was previously reported that the defence stage of Najib’s RM42 million SRC trial has been fixed to begin on Dec 3.
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