This article first appeared in The Edge Financial Daily on July 11, 2019
KUALA LUMPUR: Former treasury secretary-general Tan Sri Wan Abdul Aziz Wan Abdullah testified yesterday he was instructed by former premier Datuk Seri Najib Razak to expedite the release of the Retirement Fund Incorporated’s (KWAP) first RM2 billion loan to SRC International Sdn Bhd, even before a government guarantee was issued.
Wan Abdul Aziz, 67, told the High Court it was unusual for KWAP to disburse loans before receiving government guarantees.
Wan Abdul Aziz, who served as the treasury secretary-general from 2007 to 2012, was also chairman of KWAP during the same period.
Replying to Deputy Public Prosecutor Datuk Suhaimi Ibrahim, he said he received a phone call from Najib, who was also the finance minister then, to expedite the first loan approval process to allow for an early disbursement of the money to SRC International.
Wan Abdul Aziz then informed Datuk Maliami Hamad, who was a secretary with the finance ministry, about the phone call he received from Najib and asked him to write to KWAP for the release of the loan.
Maliami had earlier testified he had informed KWAP of Wan Abdul Aziz’s instruction.
He also testified that the cabinet had approved the second government guarantee in February 2012, but it was only issued in May that year. In the interim, a letter of guarantee dated March 11 was made as SRC International needed the funds urgently.
SRC International had initially requested for a RM3.95 billion loan from KWAP in 2011.
KWAP’s investment panel, however, decided to only approve a sum of RM1 billion, saying the original requested amount was an “overconcentration” of money in just one company from one industry.
SRC International subsequently made a new application requesting for a RM2 billion loan in the same year.
Wan Abdul Aziz said he had been summoned to the Prime Minister’s Office for a private meeting, where he was told that RM2 billion would be a sufficient amount for SRC, but not the RM1 billion initially approved.
SRC International subsequently made an application for another RM2 billion loan in 2012.
Wan Abdul Aziz was testifying against Najib, who is facing three counts of criminal breach of trust, one charge of abusing his position and three counts of money laundering in relation to SRC funds totalling RM42 million.
Najib is also charged with abusing his power as prime minister by giving government guarantees on SRC’s loan from KWAP.
During cross examination, defence counsel Farhan Read started with some basic questions, asking Wan Abdul Aziz on the background of KWAP and the fund’s fixed income department.
The repetitive questions caused Justice Mohd Nazlan Mohd Ghazali to interject, asking the lawyer to be focused in his line of questioning, given that some of the queries were already answered by previous witnesses.
Later, Farhan asked the witness whether he had any knowledge on the formation of SRC and presented him with a letter dated Aug 2010 written by 1Malaysia Development Bhd (1MDB) directed to the prime minister at the time.
The letter outlined the sovereign wealth fund’s intention to set up SRC International.
“This is the first time I have seen this letter,” said Wan Abdul Aziz.
About 20 minutes before the proceedings were scheduled to end, Farhan requested to conclude proceedings as he needs to discuss with his team regarding the next course of action in their cross-examination of Wan Abdul Aziz.
“I don’t have much more to ask, but the issue is whether I should continue with what I have. I don’t want to waste the court’s time by asking just for the sake of asking,” the lawyer said.
Lead counsel Tan Sri Muhammad Shafee Abdullah said lawyer Harvinderjit Singh, who was not present yesterday, has certain “dominant points” to put to the witness today.
“We hope to finish cross-examination way before lunch tomorrow [today],” said Muhammad Shafee.
“Way before lunch?” repeated the judge, eliciting giggles in the courtroom.
“I know it sounds vague but yes, way before lunch,” said Muhammad Shafee.