SINGAPORE (Nov 10): Yeo Jiawei, the former wealth planner at BSI, who is said to be among the individuals behind a complex web of corporate entities used to divert funds from 1Malaysia Development Bhd, made himself out to be little more than a junior employee at the Swiss private bank when he took the stand for the first time on Thursday.
He also claimed that it was he who had flagged the risks to senior BSI staffers of a 1MDB entity using a fund structure to channel money to Eric Tan Kim Loong, who is said to be an associate of Low Taek Jho, better known as Jho Low. Yeo, who will turn 34 on Nov 21, is on trial for four counts of witness tampering.
By the time he took the stand on the eighth day of the trial, the court had already heard from nine witnesses for the prosecution. Responding to questions from his lawyer Philip Fong, Yeo told the court that he was a member of a small team within BSI supporting front-line bankers such as Yak Yew Chee, who dealt directly with Low.
“[Yak] is the only one that brings in so much revenue for the bank, only he and the CEO [Hans Peter Brunner] fly first class,” said Yeo. He described Yak, who is facing charges of forging documents, as “very possessive” over access to his client Low.
According to him, Yak would relay instructions from Low to Yeo’s then boss, Kevin Swampillai, BSI’s head of wealth management services. Swampillai would then tell Yeo what to do.
When Yeo met Low for the first time in 2011 at the St Regis Hotel, Low did not even bother looking him in the eye, he said. Instead, Low talked directly to Yak and Swampillai.
Yeo also told the court that he graduated from Nanyang Polytechnic with a diploma in banking and finance. He then joined UBS, and studied part-time to earn a degree in management, as well as a chartered financial analyst qualification.
Yeo said it was Swampillai who hired him at BSI, with the words, “Work hard and you will have a bright future at BSI”. Swampillai, 52, is a charismatic and very persuasive person, according to Yeo.
In court, Yeo related an occasion when Swampillai managed to convince a big Indonesian client to ditch UBS in favour of BSI. He also suggested that, unlike the front-line bankers who brought clients in and had some autonomy, he had to do as Swampillai said. “The fate of my career depends on him, he put me up for promotion, he decides my pay.”
Yeo also described how Swampillai had mooted the idea of forming a company outside of BSI to enable the two of them to earn management and referral fees from clients of the bank. Yeo said he was told that a BSI client, a Malaysian sovereign wealth fund, would be an anchor investor in the company.
He went on to say that he had assumed Swampillai had obtained the blessing of BSI’s management committee, especially since Swampillai himself sat in that committee. “I was quite thrilled and excited to get this move,” Yeo said of his reaction to Swampillai’s offer. “I won’t be just a support staff in the bank. My boss is asking me to join him in this fund partnership.”
As it happened, Swampillai and Yeo did not set up the company they talked about.
SRC International deal
However, Yeo and Swampillai did go on to do work for the sovereign wealth fund, which was 1MDB. In December 2011, they created a fund structure for a US$100 million investment by SRC International, then a subsidiary of 1MDB. The fund was called Enterprise Emerging Market Fund, or EEMF.
Under this arrangement, SRC would direct the manager of the fund on what to do with the money invested. Yeo told the court that SRC asked that EEMF extend a loan of US$100 million to a company called “Blackstone”, whose beneficial owner was Tan.
Yeo claimed he raised his concerns to his bosses at BSI about the structure. “I asked what if the investment became zero and what would happen?” he said. Yeo claimed that Yak, Low’s relationship manager, was not happy that he had flagged the need for the bank’s senior management to approve such a deal.
Nevertheless, approval was granted the same day, and SRC even gave BSI an indemnity shielding the bank from responsibility. Many more transactions were to follow from 1MDB and SRC, Yeo said.
41,000 pictures, 800 videos
Earlier in the trial, a number of witnesses for the prosecution painted Yeo as a key individual behind the web of entities linked to 1MDB. Among them were Swampillai and Jose Renato Carvalho Pinto, who was a relationship manager at Amicorp, a company that provided fund administrative services. In fact, Swampillai testified that Yeo went to work for Low after leaving BSI in June 2014, and that he understood Low paid him $500,000 a year.
Separately, Pinto testified that Yeo was privy to impending political movements of the highest level in the Malaysian government because of his relationship with Low. Specifically, on July 22, 2015, one week before Malaysia’s Deputy Prime Minister Muhyiddin Yassin was sacked by Prime Minister Najib Razak, Yeo told Pinto he knew that it was “war time within Malaysia” and that they should remain calm, said Pinto.
The court had also been shown a number of pictures extracted from Yeo’s iPhone which had been taken after he left BSI. Among them was one of Low on a private jet. There was also a selfie with boxing legend Mike Tyson, purportedly taken last year in Las Vegas, at the muchhyped match between Floyd Mayweather Jr and Manny Pacquiao. There was also a picture of Low with Aabar Investments PJS Ltd director Mohamed Ahmed Badawy Al-Husseiny.
According to Commercial Affairs Department investigator Oh Yong Yang, who took the stand on Wednesday and Thursday, more than 41,000 pictures and more than 800 videos were found in Yeo’s iPhone. When asked on Thursday by Yeo’s lawyer Fong if there were any pictures of Yeo with Low, or Yeo with Husseiny, the CAD officer said, “I can confirm there are other pictures.” He did not elaborate.
Yeo faces seven other charges of money laundering. According to prosecutors, these charges will be heard in April.
Side story: Argument over Aabars
On Thursday, the eighth day of the trial, references to statements made by 1Malaysia Development Bhd and Malaysia’s Attorney-General Mohamed Apandi Ali by defence lawyer Philip Fong drew a strong objection from Deputy Public Prosecutor Nathaniel Khng.
The statements were about Aabar Investments PJS, a subsidiary of Abu Dhabi sovereign wealth fund International Petroleum Investment Company (IPIC). Three other companies with identical names have been discovered. These companies were incorporated in the British Virgin Islands, Samoa and Seychelles.
There was also a fourth company called Aabar International Investments PJS Ltd, which was incorporated in the British Virgin Islands (BVI). Mohamed Ahmed Badawy AlHusseiny, CEO of IPIC, is listed as a director of all four “fake” Aabars.
On July 20 and 21, authorities in the US and Singapore made coordinated statements about their investigations into 1MDB, and stated that a BVI company called Aabar Investments PJS Ltd had received proceeds from funds diverted from two bond issues guaranteed by 1MDB and IPIC.
On April 11, IPIC said it never received the funds from 1MDB. IPIC also disassociated itself from this BVI-incorporated Aabar. But that statement was rebutted by 1MDB. The sovereign wealth fund pointed out that money was paid to the BVI-incorporated Aabar in 2014, and asked why IPIC waited until April 2016 to raise the matter.
Also, on July 21, Mohamed Apandi Ali issued a statement in response to the statements from the US and Singapore authorities, saying “… there has been no evidence from any investigation conducted by any law enforcement agencies in various jurisdictions which shows that money has been misappropriated from 1MDB”.
In his cross-examination of Commercial Affairs Department (CAD) officer Oh Yong Yang on Thursday afternoon, Fong began a line of questioning that seemed to raise doubt about the statement made by IPIC. Khng stood up to “strongly object”.
Referring to IPIC’s April 11 statement, he said that “IPIC is the owner of the entity that is the subject of investigations, Aabar, and they are in the position to state categorically whether or not they own or do not own a certain entity”.
Khng went on to say that Mohamed Apandi Ali’s statement is of no relevance to investigations in other jurisdictions. “He cannot on behalf of other jurisdictions give a conclusive statement as to what is going on, unlike IPIC, Your Honour, which is the direct owner of Aabar,” said Khng.
Fong then noted that as there is no conclusive word yet on the exchange of words between IPIC and 1MDB, the IPIC statement is thus “hearsay” and should not apply to this court.
He added that since there had been transactions involving 1MDB and various entities named Aabar, 1MDB is in a position to disagree with IPIC’s statement that it does not own certain Aabars. “In fact the statement dated April 11, 2016 is itself very categorically expressing surprise, shock that IPIC is making such a statement,” said Fong.
Khng responded, “1MDB does not own Aabar. It is IPIC which owns Aabar. Only IPIC or Aabar Abu Dhabi is in a firm position to give an answer as to who owns the Aabar entities”, he said. In the end, the court allowed Fong to continue with his line of questioning.
During the same session, CAD officer Oh also confirmed that Low, along with several associates, has been under investigation for over a year.
According to Oh, “key persons of interest” in the money laundering investigations include ex-BSI banker Yeo Jiawei, Mohamed Ahmed Badawy Al-Husseiny, and Low’s close associate Eric Tan Kim Loong, as well as “several other individuals” — a phrase he used on the stand several times without elaborating.
Oh told the court that CAD has been investigating the money laundering activities of these individuals as well as related entities across various jurisdictions since 2015. These entities include the four “fake” Aabars.