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This article first appeared in The Edge Financial Daily on December 11, 2019

KUALA LUMPUR: Former prime minister Datuk Seri Najib Razak maintained that despite him agreeing to a suggestion that the Retirement Fund Inc (KWAP) extend a RM2 billion loan to SRC International Sdn Bhd, it was still KWAP’s investment board’s decision to approve or reject it.

This was despite Attorney-General (AG) Tan Sri Tommy Thomas highlighting the KWAP investment paper that was submitted to the board, initially recommending a RM1 billion cap, followed by the minutes of the second meeting by the fund’s investment panel where its chairman Tan Sri Wan Abdul Aziz Wan Abdullah said Najib had told him that “RM2 billion was sufficient”.

Notably, this is the first time in the country’s history that an AG is cross-examining a former premier.

Thomas: I put it to you that [the investment panel] accepted your instruction?

Najib: I disagree.

Thomas: I put it to you that the panel they never disobeyed your order?

Najib: I disagree.

Thomas: I put it to you that they were appointed to carry out your will?

Najib: No.

When Thomas mentioned Wan Abdul Aziz had revealed what could be added pressure after the panel initially agreed to a loan of RM1 billion only, the former PM said “it is up to them to disagree”.

“They can say that they do not agree,” said the Pekan member of parliament.

Thomas suggested that the KWAP investment panel was appointed by Najib as he was also the finance minister.

Earlier, the former premier said he does not remember whether the five members of KWAP investment panel were appointed by him.

Wan Abdul Aziz, in his testimony during the prosecution case, told the court that KWAP’s investment panel agreed to extend a RM1 billion loan as it did not want so much funds to be concentrated or risked in a single company.

“I went to see Najib to inform him about the decision, but he said RM2 billion would be sufficient,” the former Treasurer secretary-general told the court.

Thomas: If we were all following the law, we wouldn’t be here?

Earlier, the AG also pointed out former SRC managing director Nik Faisal Ariff Kamil’s letter dated June 3, 2011 to him, and not KWAP, for a RM3.95 billion loan. Najib wrote a note indicating he agreed to the proposal in the letter addressed to then KWAP chief executive officer Datuk Nor Azian Mohd Noh.

Thomas: The KWAP investment panel and its staff had taken the note to mean Najib’s approval of Nik Faisal’s request, meaning the loan must be approved?

Najib: Why are you saying that I approved? It’s the law, and the law states that they (the investment panel) must approve it. It is not me!

Thomas: If we all were following the law, we wouldn’t be here Datuk Seri?

Najib: Yes, but you are the attorney-general, you should know the law.

 

Agreement not ‘carte blanche’ approval

During his examination-in-chief last week, Najib said the note in the June 3, 2011 letter did not amount to a “carte blanche” approval as his officers were free to disagree with him.

“This resulted in my changing the earlier decision [of being in agreement]. The word ‘bersetuju’ does not denote finality in my decision, as it can be changed. It could be subject to further scrutiny by my officers who may give differing opinions on the issue.”

During her testimony in the prosecution stage, Nor Azian described Najib as the “ultimate boss” as he was the prime minister and finance minister overseeing KWAP affairs.

He confirmed that he appointed SRC’s board of directors — Tan Sri Ismee Ismail, Datuk Che Abdullah@Rashidi Che Omar, Datuk Shahrol Azral Halmi, Nik Faisal Ariff and Datuk Suboh Md Yassin — but that they may also have been recommended by other people.

Ismee had testified that Najib had the power to “hire and fire” the board, while Suboh said Nik Faisal dared to act without consulting with the board because he was emboldened by the “mountain behind him”, implying Najib.

Najib also denied the prosecution’s suggestions that he appointed himself as the finance minister, despite being prime minister, Umno president and Barisan Nasional chairman, to ensure SRC is able to secure the government’s guarantees.

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