The Malaysian Insight

KPMG had sought an explanation regarding a 1Malaysia Development Bhd (1MDB) investment from Najib Razak, the Kuala Lumpur High Court was told today.

Former 1MDB chief finance officer Azmi Tahir said the audit firm wanted the ex-prime minister to explain the state-owned investment company’s stake in Bridge Global SPC through Brazen Sky Ltd.

He said Najib asked KPMG to close the 1MDB 2013 financial report during a meeting between the two at the leader’s residence on December 15, 2013.

“KPMG managing partner Johan Idris asked Najib about the SPC investment and Najib replied that he knew about it.

“The leader asked why the audit firm still raised suspicions regarding the investment’s underlying assets when BSI Bank had shown the investment statement.

“He told the firm to close the account before December 31, 2013.”

Azmi said present at the meet were former 1MDB chief executive officer Mohd Hazem Abdul Rahman, former 1MDB chairman Che Lodin Wok Kamaruddin and himself.

The court had previously heard that Brazen Sky is a company set up by fugitive financier Low Taek Jho, or Jho Low, and incorporated in the British Virgin Islands.

The 12th prosecution witness said after the meet, KPMG did not close the report as it was dissatisfied with the answers and documents provided.

1MDB then terminated its contract with KPMG at the end of 2013, and took in Deloitte as a third auditor.

“Deloitte was to complete the audit of the 1MDB accounts for the 2013 period and subsequently, the 2014 accounts.”

Najib, 68, is facing 25 abuse of power and money laundering charges over alleged 1MDB funds amounting to RM2.28 billion deposited into his AmBank accounts between February 2011 and December 2014.

He faces up to 20 years’ jail if convicted.

Singapore BSI Bank acted as fund manager for 1MDB’s alleged US$2.3 billion (RM9.5 billion) investment in SPC.

Azmi said before the meet, he received an email from Low, who had arranged a strategy to answer the questions fielded by KPMG.

In the email titled “Urgent: Briefing Package for YAB PM”, the businessman ordered Najib to not talk much with the audit firm, he added.

“Najib must say that he is aware of all 1MDB investments and transactions and confident of the available documents.

“Low also ordered him to express confidence in BSI Bank based on the given facts.”

He testified that the issues outlined in the email were discussed during the meeting.

“Although I was CFO of 1MDB, and the audit is directly under my jurisdiction, Low arranged all the documentation and talking points to Najib.”

The trial continues before judge Collin Lawrence Sequerah. – November 16, 2021.