Board confusion on Najib's role over 1MDB: Ex-chair

Summary

• 1MDB’s ex-chairperson Che Lodin Wok Kamaruddin testifies that the board of directors including himself at times were confused about ex-premier Najib Abdul Razak’s various roles over the Malaysian sovereign wealth fund.

• The defence witness refers to Najib’s roles as finance minister who is sole shareholder of the Minister of Finance Incorporated (MOF Inc) which fully owned 1MDB, as well as the accused role as chairperson of the fund’s board of advisers.

1MDB TRIAL | 1MDB’s former chairperson testified there was confusion among board members about Najib Abdul Razak’s role over the Malaysian sovereign wealth fund.

Che Lodin Wok Kamaruddin told the High Court in Putrajaya this afternoon over the accused’s various roles as then prime minister, finance minister, and chairperson of 1MDB's board of advisers.

During Najib’s RM2.27 billion 1MDB abuse of power and money laundering trial, the defence witness told lead defence counsel Shafee Abdullah why board minutes showed directors seeking the accused’s advice as BOA chairperson rather than the BOA as a whole.

The fund is fully owned by the Minister of Finance Incorporated (MOF Inc), whose sole shareholder is the finance minister.

During examination-in-chief, Shafee asked why the 1MDB board minutes showed directors seeking the BOA chairperson’s advice over the fund’s overseas investments and implications on Malaysia.

Shafee: Why not to the BOA (as a whole which had several members) and not to the (then) BOA chairperson (Najib)?

Lodin: This possibly could be due to confusion among us over the role of Najib as the finance minister who represented MOF Inc (as its sole shareholder), BOA chairperson and prime minister.

No absolute power

However, the former 1MDB chairperson reiterated that the fund’s memorandum and articles of association (M&A) do not grant Najib absolute power over the fund to the point of “almost like a dictator”.

Lodin was referring to Article 117 of 1MDB’s M&A, which the prosecution contended gave Najib power to approve the appointments of directors, the senior management team as well as matters relating to financial commitments.

Shafee: Does Article 117 give the prime minister absolute power almost like a dictator in the company?

Lodin: No.

Shafee: Why not?

Lodin: There are many aspects of the operation of 1MDB which do not require approval under (Article) 117, so if the prime minister is considered a dictator by implementing 117, then of course in many ways it would disrupt the operations of 1MDB. Because every little matter that needs to be carried out must get approval (of Najib) under 117 if it is interpreted as such.

Shafee: Has that ever happened?

Lodin: No.

Lodin unaware Low was Najib’s adviser

During today’s trial, Lodin testified it did not occur to him back on Sept 26, 2009, that fugitive businessperson Low Taek Jho (Jho Low) was an adviser to Najib.

The defence witness was recalling what transpired during a 1MDB board meeting on that date when Low had handed over his handphone to the fund’s then-chairperson Bakke Salleh to facilitate a conversation with Najib.

Lodin testified that Low, who had no official role in 1MDB, was there as a representative of Saudi Arabia, and that the businessperson did not stay around for the board meeting.

The witness recalled that just before the meeting started, Low received a telephone call from Najib, and the businessperson then handed over the handphone to Bakke, conveyed the Saudi royal’s best wishes to the directors, and left the meeting.

Lodin: He (Low) did not stay back.

Shafee: Was it unusual (for Low to attend the meeting due to not having any official role in 1MDB)?

Lodin: He was not a member of the board, I would have objected, but I intimated to the company secretary that Low was not a member of the board.

Shafee: Who invited him (Low)?

Lodin: I suppose it was (1MDB) management, could be Shahrol (Azral Ibrahim Halmi, who at the time was the fund’s CEO).

Shafee: Did anyone at the meeting say Low was an adviser to Najib?

Lodin: At the time, it did not occur to me or did I get the impression that he was an adviser to Najib.

Prosecutors contended that Low’s actions at 1MDB were done with Najib’s blessings.

When Shafee asked whether Lodin’s testimony was to help Najib, the defence witness said that he was trying very much to present what really factually happened in 1MDB’s operations when he was director and later the fund’s chairperson between 2009 and 2016.

The trial resumes tomorrow.

Prima facie case

On Oct 30 last year, the criminal court ordered Najib to enter his defence over four abuses of power and 21 money laundering charges involving RM2.27 billion from 1MDB.

Trial judge Collin Lawrence Sequerah ruled that the prosecution succeeded in establishing a prima facie (answerable) case against Najib due to the strength of some 50 witness testimonies.

Between early December last year and late January this year, Najib spent 26 days on the witness stand trying to raise reasonable doubt in the prosecution’s case.

The accused contended that he had neither knowledge nor involvement in wrongdoing at 1MDB and that all embezzlement there was solely masterminded by fugitive businessperson Low Taek Jho (Jho Low) and members of its management.

The former Pekan MP also relied on the defence that he was given a donation promise by the late Saudi King monarch King Abdullah during a meeting between them in Riyadh in 2010.

The accused has been serving a six-year jail sentence since August 2022 over a separate graft case involving RM42 million from SRC International, a former subsidiary of 1MDB.

The sovereign wealth fund’s stated purpose was to ensure long-term sustainable development while safeguarding the economic well-being of Malaysians.

MOF Inc also fully owned both SRC.

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