Businessperson surprised at having to return RM8m to Zahid's foundation
Ri-Yaz Group managing director Mohammad Shaheen Shah Mohd Sidek said he was surprised when then deputy prime minister Ahmad Zahid Hamidi asked him to return more than RM8 million in deposit payment after a deal between his daughter Nurulhidayah and the company did not go through in 2017.
Shaheen appeared as the 84th witness on the 29th day of Zahid's bribery, money laundering and criminal breach of trust trial.
Ri-Yaz Group managing director Mohammad Shaheen Shah Mohd Sidek said he was surprised when then deputy prime minister Ahmad Zahid Hamidi asked him to return more than RM8 million in deposit payment after a deal between his daughter Nurulhidayah and the company did not go through in 2017.
Shaheen appeared as the 84th witness on the 29th day of Zahid's (photo, above) bribery, money laundering and criminal breach of trust trial.
Shaheen, while under examination by deputy public prosecutor Ahmad Sazilee Abdul Kahiri, said based on business convention, deposits are normally non-refundable if a deal is aborted.
Ahmad Sazilee: Is this normal in business practice?
Shaheen: When I was informed, I didn't know the contents of the sales and purchase agreement. So, I was surprised that I had to pay back (the deposit). I thought the money was a deposit for the share purchase.
Ahmad Sazilee: In normal business practice, when we speak of deposit, does it need to be returned if the agreement is cancelled?
Shaheen: No need.
The deal involved Nurulhidayah's bid to purchase a 60 percent stake in Ri-Yaz Asset Sdn Bhd, which owns a hotel in Bali. The RM8,602,920 deposit for the deal was paid out of Yayasan Akalbudi Sdn Bhd, a charitable foundation founded by Zahid.
While under cross-examination, defence lawyer Mohd Haziq Dhiyauddin Razali suggested that the deal was instead an investment by Yayasan Akalbudi and Nurulhidayah was only appointed as a director to oversee the foundation's investment.
He added that the deal did not proceed as it was deemed not to be profitable.
However, Shaheen merely replied that he did not know.
Shaheen, during re-examination later, agreed with the prosecution that discussion about the share purchase had never touched on profitability as suggested by Mohd Haziq.
Earlier, Shaheen explained that Ri-Yaz Group comprised a collection of companies including Ri-Yaz Hotels & Resorts, Ri-Yaz Global Food Brands, Ri-Yaz Development, Ri-Yaz Higher Learning dan Ri-Yaz Asset Sdn Bhd.
'Zahid personally asked for money back'
He also confirmed three cheque transactions between Ri-Yaz Assets Sdn Bhd and Yayasan Akalbudi Sdn Bhd.
They formed the RM8,602,920 transaction from Messr Lewis & Co, the trustee of Yayasan Akalbudi, to Ri-Yaz Asset on June 30, 2016, intended to pay off the company's overdue loan from Exim Bank on the Bali hotel, which was a precondition for Nurulhidayah to acquire the 60 percent stake in Ri-Yaz Assets.
The 60 percent stake was owned by then Ri-Yaz Group's chairperson Abdul Rashid Abdul Manaf, who was also a director of Ri-Yaz Assets at the time. Abdul Rashid was the 83rd witness in the case and had testified yesterday.
Based on Abdul Rashid testimony yesterday, Ri-Yaz Group had taken out a US$24.8 million loan from Exim Bank to purchase a hotel in Bali valued at US$31 million but was facing cash flow problems in servicing the loan on time.
Abdul Rashid had mulled selling the hotel or disposing of his shares in Ri-Yaz Assets to raise funds to pay the loan in his name, and Nurulhidayah had expressed interest in acquiring his stake.
This led to an eventual meeting between Abdul Rashid, Shaheen, Nuruhidayah and Zahid.
However, Exim Bank refused to release Abdul Rashid from the loan and wanted him to retain at least a 10 percent stake in the company, leading to a snag, and the deal was eventually aborted.
Nurulhidayah was appointed as a director of Ri-Yaz Assets on January 27, 2017, and resigned on July 31, 2017, after the deal was aborted.
At the trial today, Shaheen also confirmed two other transaction from Ri-Yaz to Lewis & Co, namely a RM254,879.10 refund due to currency difference and the remaining RM8,348,040.90 after the deal failed to go through and Zahid asked for a refund.
Shaheen, while under examination, said he had met with Zahid and Nurulhidayah after the deal was cancelled and was asked to give a refund.
"Zahid personally said that I must refund the money as it belonged to the foundation. I did not know which foundation.
"But he said the money (RM8.348 million) must be returned and asked when Ri-Yaz will refund the money," he said.
Shaheen also said he did not ask why Zahid wanted the money to be paid to Messrs Lewis & Co instead of directly into Yayasan Akalbudi's account.
He said he was also informed later by Abdul Rashid who said Zahid had asked for Ri-Yaz to immediately refund the money and remove Nurulhidayah's name as a director.
Zahid is facing 47 charges, comprising 12 charges of criminal breach of trust, 27 charges of money laundering and eight charges of bribery.
The trial is being presided over by High Court judge Collin Lawrence Sequerah.
Are you sure you want to delete this comment?
This action cannot be undone.