KUALA LUMPUR (June 3): The hastiness in the issuance of the government guarantee (GG), and disbursement of funds, with regards to the RM4 billion loan taken by SRC International Sdn Bhd from the Retirement Fund Inc (KWAP) raises suspicions and points to power abuse, the High Court was told today.
Former Finance Ministry secretary Datuk Maliami Hamad had testified that such hastiness “was not normal practice and had not happened before”, ad hoc prosecutor Datuk V Sithambaram said during final submissions in the SRC trial of former premier Datuk Seri Najib Razak.
“Former Finance Ministry Treasury secretary-general Tan Sri Wan Abdul Aziz Wan Abdullah, who was also KWAP chairman, testified that it was an 'amalan luarbiasa' (unusual practice) when Najib had asked KWAP to disperse its funds first without the GG being obtained,” he said.
All this indicates that Najib, as the then Prime Minister and Finance Minister, had abused his power to ensure that the funds were disbursed quickly, said Sithambaram.
The ad-hoc prosecutor was replying to the defence’s submission over the former premier's abuse of power charge in relation to the approval of the KWAP loan totalling RM4 billion.
SRC had received RM2 billion from KWAP in August 2011. For the second loan of RM2 billion, the GG was approved by the Cabinet in February 2012 although no application had been made by SRC and the money was immediately released in March 2012.
Sithambaram noted that a total of RM4 billion of the KWAP money had been lost, and as a result the Government, which issued the GG, had to pay a total of RM9.2 billion to KWAP, when SRC was unable to service the loan.
The prosecutor said since the RM4 billion money had been given to KWAP, nothing had been done as the SRC projects in Mongolia and other parts of the world – for which the loan was obtained - did not materialise.
Sithambaram also pointed to the testimony of the defence’s third witness, Tan Sri Irwan Serigar Abdullah, that normally a GG is issued in one to three months, but in the case of SRC it was given in a shorter span of time.
Sithambaram also submitted that Najib's notation to KWAP's former CEO Datuk Azian Mohd Noh, on SRC's letter dated June 3, 2011 to approve a loan of RM3.95 billion, was a directive as KWAP was a unit under the finance ministry.
‘Ahmad Husni tried to retrieve funds but was prevented’
The prosecutor also addressed the attack by the defence on the testimony of former Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, which they claimed was not credible as the former Umno treasurer allegedly harboured a grudge.
Sithambaram said Ahmad Husni had in 2013 and 2014 met Najib and sought his permission to retrieve the funds which SRC deposited in Switzerland and which had been frozen, but the then premier turned down the request.
Referring to his cross-examination of Najib on the reason for not allowing Ahmad Husni to go to Switzerland, Najib replied that his former Minister did not show a plan.
Sithambaram asked if the former premier wasn't showing interest in getting the money back for the country and in the end the money allegedly remained there.
“Ahmad Husni had testified that Najib instructed him not to interfere in matters related to 1Malaysia Development Bhd (1MDB) and its subsidiaries (which included SRC then).
“(Ahmad Husni) was the only other person besides the accused (Najib) who had control over Ministry of Finance Inc companies (that included 1MDB and SRC), but yet was denied from carrying out his duties. Najib tried to explain that Ahmad Husni's testimony was due to bad blood between them.”
“It is the prosecution's contention that this allegation is incredible as the defence implied Ahmad Husni harboured bitterness against the accused which resulted in the dismissal of the witness’s son from his position at the New Pantai Expressway. However, Najib in his testimony said the animosity between them began after he planned to move Ahmad Husni to the Economic Planning Unit,” he said.
Besides this, the defence also contended the purported bad blood between Najib and Ahmad Husni follows allegations of sexual misconduct which the former Second Finance Minister had denied.
‘Court cannot accept ignorance claim’
Sithambaram ended his submissions today by contending that Najib cannot claim ignorance as to the source of the RM42 million over which he is facing criminal breach of trust and money-laundering charges.
“Ignorance is a defence when there is no reason of suspicion. In this case, there were bank statements issued and he issued numerous cheques and all the money was used up. Any decent person would get suspicious as to how you can issue cheques when you do not have the money and the money kept coming in.
“When people are putting in the money, there is a responsibility that there is a need to find out where the money comes from,” he added.
Sithambaram was responding to the defence’s contention that the former premier thought the RM42 million was still part of the Arab donation whereas the prosecution had shown the money had already been used up or returned by June 2013.
Besides the abuse of power charge involving the RM4 billion KWAP loan, Najib is also facing three criminal breach of trust charges involving SRC funds amounting to RM42 million and money-laundering of the same amount. He is alleged to have committed the offence between Dec 24, 2014 and Feb 10, 2015.
The defence will reply to the prosecution's submission before Justice Mohd Nazlan Mohd Ghazali tomorrow.