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1MDB replaced auditor KPMG after PM Najib called me personally, says ex-CEO

Former 1MDB CEO Mohd Hazem Abd Rahman was testifying as the 10th prosecution witness in Datuk Seri Najib Razak’s trial involving 25 charges in relation to more than RM2 billion of 1MDB’s funds. – Picture by Hari Anggara

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KUALA LUMPUR, Nov 15 — Audit firm KPMG was removed as 1Malaysia Development Berhad’s (1MDB) auditor following pressure from then prime minister Datuk Seri Najib Razak himself, 1MDB’s former CEO told the court today.

Former 1MDB CEO Mohd Hazem Abd Rahman was testifying as the 10th prosecution witness in Najib’s trial involving 25 charges in relation to more than RM2 billion of 1MDB’s funds.

Mohd Hazem was explaining why he had proposed for 1MDB to replace KPMG with Deloitte, following KPMG’s refusal to sign off on its audit of 1MDB’s 2013 financial statements due to insufficient information provided to the auditors.

Asked by lead prosecutor Datuk Seri Gopal Sri Ram as to why he had proposed for KPMG to be removed, Hazem replied: “Well, basically KPMG did not want to close it, and (I was) being pressured by the prime minister directly to find a way to solve this, and the only way to solve this is to replace with a new auditor.”

Sri Ram: Pressure came from who?

Hazem: Pressure came directly from the prime minister. I have been called directly by the prime minister even to ask about the update on the closure of the audit.

Sri Ram: Were you in a position at that time to disobey the accused?

Hazem: No, absolutely not.

Najib’s 1MDB trial before High Court judge Datuk Collin Lawrence Sequerah resumes tomorrow, with the 12th prosecution witness and former 1MDB chief financial officer Azmi Tahir expected to resume testifying.

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