Datuk Seri Najib Razak is pictured leaving the Kuala Lumpur High Court November 10,2021. — Picture by Meira Zulyana
KUALA LUMPUR, Nov 10 — Datuk Seri Najib Razak had not known that US$2.3 billion (RM9.5 billion) that the government-owned firm 1Malaysia Development Berhad had purportedly invested overseas was actually a worthless and sham investment, his lawyer claimed in court today.
Najib’s lawyer Mardhiyah Mohamed Sirajkumar said this while cross-examining former 1MDB CEO Mohd Hazem Abd Rahman, who was testifying as the 10th prosecution witness in Najib’s trial involving more than RM2 billion of alleged misappropriated 1MDB funds.
Hazem however disagreed with Mardhiyah’s suggestion. He also refused to answer on Najib’s behalf when asked for his opinion on what Najib knew or had in his mind or intended to do with his actions.
Mardhiyah today focused on events that took place in 2013, when 1MDB’s audit firm KPMG was still pressing the company to provide sufficient information on the underlying assets and valuation of assets for the alleged US$2.3 billion investment, before it could sign off on 1MDB’s financial statement for the financial year ending March 2013.
By December 2013, KPMG was still asking for such information as it had yet to be given such details which it had requested for since April 2013, and had still not signed off on the financial statement.
Focusing on a December 15, 2013 meeting between KPMG and Najib in Najib’s house over the US$2.3 billion investment, Mardhiyah noted that meeting minutes showed that KPMG’s representative Datuk Johan Idris had said the auditors were not imposing additional requirements for the 1MDB audit and that the information provided then was still insufficient to conclude the audit according to international standards.
KPMG had wanted direct information from Hong Kong-based fund manager Bridge Partners International Investment Limited which was purportedly managing the US$2.3 billion “investment” for 1MDB, and said the indirect information via a status confirmation from the investment’s alleged custodian BSI Bank Singapore was not enough.
At one point, Mardhiyah suggested that the way Najib had asked how 1MDB would be able to provide the information requested since Bridge Partners said it could not be disclosed due to the law and trade secrets indicated that Najib was “acting based on the recommendation and advice” of 1MDB’s management and board of directors when he said that, but Hazem said: “I can’t answer on his behalf.”
Hazem acknowledged that 1MDB did brief Najib about the situation. But he said that Najib was “entitled to make his own recommendation”. He disagreed that Najib was acting based on his recommendation.
Former 1MDB CEO Mohd Hazem Abd Rahman is pictured at the Kuala Lumpur High Court January 6, 2021. — Picture by Yusof Mat Isa
Mardhiyah noted that Najib was stated as having in the December 2013 meeting requested 1MDB to speak to Bridge Partners to provide the required information to KPMG in order for the audit to be completed, with Hazem then agreeing that this shows Najib was trying to find a solution on how to obtain the information.
Hazem said he had no comment when repeatedly asked by Mardhiyah if Najib was acting within his scope as 1MDB shareholder to direct 1MDB management to help KPMG or whether it showed Najib was supporting KPMG’s request to get the information.
Mardhiyah then noted Najib had in the same December 2013 meeting then asked KPMG to fly to Hong Kong — where Bridge Partners was based.
“I put it to you that if Datuk Seri Najib knew this entire management was a sham, he would not have directed KPMG to fly to Hong Kong to carry out the audit,” she said.
Hazem replied: “I have no comment.”
Mardhiyah then asked: “Datuk Seri Najib was telling KPMG to fly to Hong Kong to get the necessary comfort to complete the auditing, and that shows Datuk Seri Najib did not know the fund was a sham, the fund was worthless.”
“I disagree,” Hazem replied.
Hazem also said he had “no comment” when Mardhiyah continued to suggest that the comments made by Najib in the December 2013 meeting allegedly showed that Najib did not follow Low Taek Jho’s instructions via written talking points, or when the lawyer suggested that Najib was “practising corporate governance and suggested the right thing to do” instead of “sugarcoating” the situation according to Low’s instructions.
The trial is set to resume tomorrow.