This article first appeared in The Edge Malaysia Weekly on August 12, 2019 - August 18, 2019
AS the prosecution’s case in Datuk Seri Najib Razak’s SRC International trial soon draws to a close, its witnesses have testified to the former prime minister’s surprising indifference to advice involving 1Malaysia Development Bhd (1MDB) or its subsidiary SRC and his nonchalance over red flags raised in relation to his personal bank accounts with AmBank, which were often overdrawn or saw nearly RM13 million in cash deposited over the counter.
Last week, former finance minister II Datuk Seri Ahmad Husni Hanadzlah — the 56th prosecution witness — described Najib (also the then finance minister) as autocratic when it came to 1MDB and SRC.
He stressed the contrast between other government-linked companies (GLCs) under the Minister of Finance Inc and 1MDB and SRC, the two entities not reporting to his office or keeping documents from him over their progress.
The former minister said he had questioned Najib over the formation of 1MDB without proper feasibility studies. “[But] Najib said, ‘I know what I am doing, we are going ahead’,” he added.
Husni, who had worked under Najib in the Ministry of Finance (MoF) for seven years, said he also quizzed Najib over SRC’s involvement in the energy industry, including in a purported oil and gas deal with PetroSaudi International. The former Tambun member of parliament added that such business was better suited to Petronas, given SRC’s lack of experience in the sector.
“However, Najib told me, ‘Husni, from today onwards, you don’t get involved. I don’t want you to interfere in 1MDB’,” Husni said when replying to questions from deputy public prosecutor Muhammad Izzat Fauzan.
1MDB and SRC the only GLCs to have an adviser emeritus
Husni also said 1MDB and SRC were the only GLCs to have an adviser emeritus to help oversee their businesses and that Najib occupied the position.
He said other GLCs did not have the post but had a representative from MoF on their boards of directors.
In SRC, as adviser emeritus, Najib only dealt with the company’s then CEO and managing director, Nik Faisal Ariff Kamil, bypassing the board of directors, the company’s first chairman, Tan Sri Ismee Ismail, testified. In essence, Nik Faisal — now in hiding — was Najib’s go-to guy.
“Any decision by the board of directors must be on the advice of the adviser emeritus, who is Najib,” recalled Ismee, who was the 39th prosecution witness.
“All matters that required Najib’s attention would be executed only by Nik Faisal, because he acted as the link between the SRC board and Najib.”
He said Nik Faisal informed the board that Najib wanted the bulk of the RM2 billion from the first KWAP loan to be deposited in a Swiss bank and a Hong Kong bank.
“The decision to transfer the funds was related to Nik Faisal alone in his meeting with Najib on Sept 7, 2011, where the former premier wanted RM1.5 billion to be moved to BSI Bank in Switzerland and another RM300 million to Bank Julius Baer & Co Ltd in Hong Kong,” Ismee said.
“The remaining RM200 million was retained locally for SRC’s operational expenses.”
As with former SRC director Datuk Suboh Md Yassin, Ismee complied with Najib’s directives because of his power to hire and fire people from the board.
Nonchalant about red flags raised
Over the past weeks, witnesses have also testified on transactions involving Najib’s current accounts with AmBank from 2011 to 2015.
While the defence implied that Najib was a victim of a conspiracy to manipulate his bank accounts from 2013 to 2015, the prosecution argued that he spent lavishly from the accounts. For instance, he had exhausted RM606.51 million over 19 months from July 2013 to March 2015.
In fact, his accounts were constantly overdrawn, which necessitated his relationship manager (Joanna Yu Ging Ping) running around and ensuring there were sufficient funds to cover his cheques and credit-card purchases so that he (and the country) would not be put in an embarrassing position, Yu testified. This often meant liaising with Nik Faisal — the mandate holder for Najib’s accounts — and businessman Low Taek Jho, who is alleged to be the mastermind behind the misappropriation of billions of ringgit from 1MDB. Low is now in hiding as well.
But the large cash deposits and overdrafts as a result of Najib’s issuance of cheques of big amounts raised red flags at the bank. Then AmBank group managing director Ashok Ramamurthy suspected money laundering and wanted the accounts closed, Yu said, but Najib was reluctant to do so initially.
According to Husni’s testimony last Tuesday, he had also asked to go to Switzerland in 2015 to meet the authorities there in a bid to obtain the release of SRC funds (then amounting to RM3 billion but depreciating) kept at the Swiss bank but frozen on suspicions they were being laundered. However, Najib did not allow it, but did not explain why.
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