The Malaysian Insight

FORMER prime minister Najib Razak, through intermediaries, had pushed to secure a joint 1Malaysia Development Berhad (1MDB) and PetroSaudi International at the end of September 2009, the Kuala Lumpur High Court heard last week.

During cross-examination, former 1MDB CEO Shahrol Azral Ibrahim Halmi said he was pressured to close the deal by September 28, 2009 by fugitive businessman Low Taek Jho, commonly known as Jho Low, and 1MDB’s then executive director Casey Tang.

This was despite a clause that would result in a US$700 million (RM2.9 billion) debt for the entity.

“At the time, I was under a lot of pressure to get the deal signed. Low and Tang both assured me that it was okay, and Low reiterated that the boss (Najib) really wanted to get this done,” Shahrol said during cross-examination.

“So, I made the decision to go with what I perceived to be instructions from Najib, and signed the agreement. I trusted that it would work out because Low was working out the details with Tang, with Najib’s full knowledge.”

Shahrol said he did not inform the 1MDB board of directors of the clause that would cause the entity to go into debt.

Najib is on trial on four counts of power abuse to enrich himself with RM2.3 billion from 1MDB and 21 counts of laundering the same amount.

Prosecutors have accused him of conspiring with the Penang-born Low to defraud the state investor.

In the joint venture, worth US$2.5 billion, 1MDB was to inject a capital of US$1 billion in cash for a 40% stake.

Of the US$1 billion, US$300 million was wired to an account held by PetroSaudi Holdings (Cayman) Ltd under the name “JVCo”.

The remaining US$700 million was remitted to an account owned by Good Star, a firm controlled by Low. PetroSaudi Holdings (Cayman) Ltd is not the same company as PetroSaudi International.

Shahrol, 49, said 1MDB performed due diligence only as far as doing an internet search verify the assets of PetroSaudi International.

He said Tang’s team handled the verification of PetroSaudi’s alleged US$2.2 billion (RM9.2 billion) oil and gas properties in Argentina and Turkmenistan.

“To the best of my knowledge, Casey’s team did an internet search and that was it.”

Shahrol said when he forwarded the board’s concern over the missing US$1 billion, Najib told the witness to raise the matter with Low.

“There was one occasion. I can’t remember when exactly it was, in 2011 or 2012, when I had the opportunity to spend time with him at a CSR (corporate social responsibility) event and I asked Najib about the retrieval of US$1 billion.

“And his response was, ‘talk to Jho (Low)’.”

Najib is represented by a dozen lawyers led by Muhammad Shafee Abdullah.

Former Federal Court judge Gopal Sri Ram leads the prosecution before judge Collin Lawrence Sequerah.

The trial continues on Tuesday. – October 27, 2019.