Jho Low gave Najib a watch as a present and instructed ex-1MDB CEO to destroy all the talking points, action plans and emails, as they could have been detrimental to Najib’s political career if the wrong hands.
9.30am: Accused Najib Razak enters the court and takes a seat at the front row of the public gallery to await proceedings to begin.
9.37am: Najib enters the dock as proceedings begin.
9.40am: Court is in session.
Shahrol goes over his witness statement, verifies 1MBD documents on an AmBank term loan of RM2.5 billion.
9.55am: Former 1MDB CEO Shahrol Azral Ibrahim Halmi says he pushed back against businessperson Jho Low in 2010 over 1MDB lending another US$750 million to PetroSaudi International (PSI).
The ninth witness tells lead DPP Gopal Sri Ram during examination-in-chief that he did that as he thought 1MDB should not be giving more loans to PSI but should use the money for projects in Malaysia.
Shahrol says he asked Low to negotiate with then prime minister Najib to reduce the loan amount.
“At the same time without my knowledge, (PSI director) Tarek Obaid had written a letter to Najib dated Feb 18, 2011, for an additional loan of US$750 million.
“The letter was enclosed with a letter from Prince Turki to Najib on the same date.
“This letter was given to (former 1MDB chairperson) Lodin Wok Kamaruddin on March 11, 2011, with a written note from Najib stating that he has no opposition to the additional investment,” he testifies.
10am: A document is produced which was pursuant to an agreement dated September 13, 2010. It grants indulgence to the lenders to use RM1.6 billion for subscription of debt securities to be issued by 1MDB PetroSaudi Limited, British Virgin Islands. The document bears Shahrol’s signature.
10.04am: Correspondence between 1MDB and arranger banks AmInvestment bank and Standard Chartered Bank Bhd is produced. The document carries instructions to prepare US$300 million (RM1.25 billion). Shahrol says this was preparatory to the loan to PSI.
10.10am: Shahrol says he believed that Low only wanted to use 1MDB’s name in a bid to take over a hotel in London through Maybourne Hotel Group which was allegedly led by Low.
Shahrol was referring to the content in the minutes of the meeting of the Chairperson of Board of Advisors dated March 30, 2011, prepared by Low himself.
In the minutes, Najib had agreed for 1MDB to provide an RM750 million loan to PSI on the condition that 1MDB obtains an RM3 billion loan from SOCSO and to focus on projects under Maybourne Hotel Group, SRC International, and Kuala Lumpur International Financial District.
10.13am: Shahrol’s pushback against Jho Low led to a planned US$750 million loan being reduced to US$330 million, the court hears.
Shahrol says following a 1MDB board meeting on April 4, 2011, he stressed to Low to lower the planned investment for overseas energy projects as there was little investment for local projects.
“Following discussions between April and May 2011 between me and Jho Low, PetroSaudi International agreed to reduce the drawdown request from the joint venture company to US$330 million on May 12, 2011,” Shahrol says.
10.28am: Jho Low allegedly said PSI “complained to daddy” King Abdullah of Saudi Arabia following a further reduction in payment from 1MDB, the court hears.
Shahrol testifies he reduced the payment to PSI from US$330 million to US$205 million due to a lack of funds.
Shahrol says Low told him of PSI’s complaint sometime after May 27, 2011.
“Jho (Low) told me that PSI was very disappointed and dissatisfied and “they complained to daddy”, which means Prince Turki had informed King Abdullah.
“I was made to understand by Jho that there was also a discussion between Najib and King Abdullah on the issue,” he says.
Shahrol says in the end, he had to release a final tranche of US$125 million to PSI.
10.33: They go through a stack of letters, emails, correspondences, transaction documents from 1MDB and PSI.
10.37: Court takes a recess.
11.01am: Court resumes session.
11.20am: Shahrol says that he was not comfortable with the huge investment amount of US$1.83 billion of 1MDB funds injected into PSI through 1MDB PetroSaudi Ltd and Good Star Ltd.
Due to that, he had asked Low to find ways to get PSI to expedite the process of reinvesting “our (1MDB) money” back to Malaysia.
“At least the funds could be returned home as there were many ongoing 1MDB projects,” he tells the court.
Shahrol says Low took note of the request but there was no positive answer after he pressed the businessperson several times.
He says he kept pressing Low until he received news that there was an issue with 1MDB involving PSI.
“I was confused as all transactions were based on government-to-government investments and fully supported by the Malaysian government through the mandate given by the prime minister,” he says.
11.28am: Sri Ram asks the witness if minutes of the meetings were kept.
Shahrol replies yes. He says Patrick Mahoney, Tarik and Low were there.
11.30am: The witness says at the start of the meeting, Low gave Najib a watch as a present.
Sri Ram asks if it was an expensive watch.
The witness replies: “Yes, it looked expensive.”
11.31am: The witness says at these meetings, they went through investments PSI could make in Malaysia.
11.32am: Shahrol says at the meeting, there was no mention of the money PSI had received from 1MDB. He says no minutes of the meeting were kept.
11.33am: The witness says when the meeting took place, US$1 billion had been deposited into PSI’s account.
11.43am: Shahrol says at the end of 2012, Low had asked him if he wanted to work in Pemandu. Shahrol told Low that he serves the PM and if Najib wanted him to go there, he would.
11.44am: Shahrol says he felt that there were so many things left undone in 1MDB, such as TRX and Bandar Malaysia, as well as improving the independent power producers’ industry.
11.45am: The witness says he was surprised when Lodin told a 1MDB board meeting that Shahrol was going to Pemandu.
Shahrol: I received my offer letter from Pemandu.
11.47am: He says Pemandu was a unit under the Prime Minister’s Department headed by minister Idris Jala. The unit was set up to drive the implementation of the Economic Transformation Programme which started in 2010.
11.48am: Shahrol says initial media reports about 1MDB had pinned him as the culprit who had transferred US$700 million to Good Star Ltd, but Low was the ultimate beneficiary of these funds.
Jho Low told Shahrol that Good Star Ltd belonged to PSI, the court hears.
Shahrol testifies this was what Low told him on May 2015, following media reports that the millions of US dollars from 1MDB had gone to Good Star and that it allegedly belonged to Low.
Shahrol is testifying on the issuance of a letter dated May 22, 2015, from PSI CEO Tarek Obaid claiming that Good Star belonged to PSI.
“Jho Low told me that Good Star is owned by PSI. He promised to get PSI to write a letter to me to confirm what he said,” he tells the court.
Shahrol stepped down as 1MDB CEO in March 2013 but stayed on the 1MDB board until 2017.
11.52am: Court goes through a talking points background document.
Sri Ram: Do you recall the accused making any public statements in 1MDB’s defence?
Shahrol: I don’t recall.
Sri Ram: Do you recall any instance where the accused addressed the public about 1MDB.
Shahrol: I don’t recall any specific incident where Najib spoke publicly about 1MDB.
Shahrol: When Arul Kanda replaced me, members of the board advised him not to speak publicly about 1MDB.
Sri Ram: But the object of the talking points was to answer queries?
Shahrol: Yes, this was in case the PAC in parliament, the auditor-general and any other government parties asked about 1MDB.
11.57am: The talking points contained PSI’s history, formation and affiliation with King Abdullah, says Shahrol.
He says Low had given assurances that these talking points were agreed upon by Najib.
11.58am: I felt he did not lie about Najib’s approval because Najib had told me to act upon the ambit of the talking points, Shahrol says.
12.02pm: He says the talking points were to put across that PSI was trustworthy and has a good reputation.
12.05pm: Shahrol says Low instructed him to destroy all the talking points, action plans and emails, as they could have been detrimental to Najib’s political career if the wrong hands.
12.21pm: Court adjourns for lunch.
2.38pm: Court resumes.
2.51pm: Sri Ram shows Shahrol a document which shows Low as the beneficial owner of Good Star Ltd.
Sri Ram: Did you know this fact when you were dealing with Good Star?
Sri Ram shows him a transaction document where USD9 million went from Good Star to Red Granite.
After revealing a document showing that Najib’s stepson Riza Aziz was a director of Red Granite, Sri Ram showed four cheques to Shahrol.
Responding to Sri Ram’s query on the cheques, Shahrol says he was told by Low to hold on to them until further orders.
He says as no further orders came from Low, he passed the uncashed cheques to the finance department (of 1MDB) for safekeeping.
Shahrol elaborates that following the PSI joint-venture in Sept 2009, Low told him that the Saudi royal family wanted to donate US$100 million to Yayasan 1MDB.
Najib’s lead counsel Muhammad Shafee Abdullah then objects to the cheques as hearsay documentary evidence as well as the oral evidence of Low allegedly telling Shahrol to hold to the cheques as hearsay.
Sri Ram then resumes the examination-in-chief based on Shahrol’s witness statement.
3.05pm: Jho Low and Goldman Sachs (Asia) CEO Tim Leissner were matchmakers for the meeting between Najib and Goldman Sachs CEO Lloyd Craig Blankfein in New York in November 2009, the court hears.
Shahrol says that he was asked by Low to fly with Najib to meet with prospective investors in 1MDB. He and then 1MDB chairperson Lodin Wok Kamaruddin flew there on Nov 21 that year.
Shahrol says the meeting took place on Nov 22, 2009.
“Low and Tim Leisnerr became the matchmakers for the meeting. Low was the facilitator for Najib while Tim Leisnerr was the facilitator for Lloyd Craig Blankfein.
“I noticed that Jho Low and Tim Leissner were very close based on their body language and conversation,” he says.
3.07pm: Shahrol says Najib had requested for support and consultation from Blankfein as Goldman Sachs had the expertise in finance and investments.
They also discussed 1MDB investing in real estate, energy, tourism and agriculture.
“After that meeting, my confidence in any monetary dealing with Goldman was high.”
The witness says based on that meeting in New York, whenever Low wanted to bring in Goldman Sachs as a financial adviser in 1MDB’s negotiations, be it financial and investments, it was done with the blessing of Najib.
“I was instructed by Jho Low that Goldman’s involvement was done in good faith as it had already received approval from Najib.”
3.08pm: Shahrol says one of the main sectors 1MDB wanted to invest in was Independent Power Producers (IPPs) in May 2010.
He says they wanted to invest in IPPs to increase electricity generation levels in peninsular Malaysia by 2016.
Sri Ram then asks Shahrol about the New York meeting.
Sri Ram: Did the accused appear surprised you were at the New York meeting?
Shahrol: No he wasn’t.
Sri Ram: From what you observed, what was Najib’s and Jho Low’s body language?
Shahrol: At that meeting, Low was seated far back from Najib. Najib was seated with Lloyd. Low was hovering in the background at the other end of the room.
Sri Ram: Did the accused have a conversation with Jho Low?
Shahrol: I didn’t see. I don’t remember the sequence of (events at) the meeting. Lodin and I were ushered in before the Goldman Sachs people were there.
Sri Ram: When you walked into the room, Jho Low was already there with the accused?
Shahrol: I can’t remember. I remember we were waiting outside for a while. I don’t remember if Jho was with us, or the Goldman people or already in the room.
Sri Ram: You said that after the meeting, the Goldman Sachs people left. Who left first?
Shahrol: Lodin and I left first, Jho Low, Goldman Sachs and Najib were still in the room.
3.16pm: Shahrol tells the court that in November 2011, he was invited by Mubadala to Abu Dhabi to watch the Formula 1 race. This meeting was arranged by Jho Low.
“While I was there, I was invited to attend a gala dinner. It was arranged in such a way that I sat next to Mubadala CEO Philip K Haddad.
“It was here that Philip tipped me off that Ananda Krishnan wanted to sell his shares in Tanjong Energy Holding Sdn Bhd.”
Shahrol: We saw this as a great opportunity in our foray into the IPP sector. I told Low about it and he agreed. He asked me to come up with a concept paper to be given to the prime minister on the investment.
“Najib also gave positive feedback on this. So…it will become big.”
3.18pm: Shahrol says from enquiries he made about Tanjong, it was true that they were going to sell.
“Goldman Sachs was also involved in buying Tanjong.”
3.24pm: Shahrol says 1MDB had appointed Goldman Sachs as financial adviser to procure Tanjong Energy Holdings. The document to appoint them was signed by Shahrol. It stipulates that Goldman Sachs would get 0.5% of the transaction fee between 1MDB and Tanjong.
3.27pm: The “engagement letter” that Shahrol signed also stipulated that if the deal was called off or had collapsed, then Goldman would be paid 30% of the total transaction. The takeover of Tanjong was RM10.6 billion. Shahrol says that the 0.5% (plus other fees) or RM100 million was paid to Goldman Sachs.
3.33pm: Shahrol says two gas power plants were bought after 1MDB had purchased Tanjong. Goldman Sachs did the valuation of these power plants.
3.40pm: Shahrol says 1MDB completed its purchase of Tanjong on March 2, 2012.
4.14pm: Kuala Lumpur High Court judge Collin Lawrence Sequerah allows proceedings to adjourn early today.
He allows this when Sri Ram applies for early adjournment as Shafee needs to prepare for the Cradle Fund CEO murder trial at the Shah Alam High Court tomorrow.
Proceedings will resume on Monday next week.
Sept 25, Najib’s 1MDB Trial: Day 13
Sept 24, Najib’s 1MDB Trial: Day 12
Sept 23, Najib’s 1MDB Trial: Day 11
Sept 19, Najib’s 1MDB Trial: Day 10
Sept 18, Najib’s 1MDB Trial: Day Nine
Sept 17, Najib’s 1MDB Trial: Day Eight
Sept 10, Najib’s 1MDB Trial: Day Six
Sept 10, Rosmah Fond of Jho Low
Sept 5, Najib’s 1MDB Trial: Day Five
Sept 4, Najib’s 1MDB Trial: Day Four
Sept 3, Najib’s 1MDB Trial: Day Three
Sept 3, Jho Low in Najib’s Inner Circle
Aug 29, Najib’s 1MDB Trial: Day Two
Aug 28, Najib’s 1MDB Trial: Day One
Aug 28, Najib’s 1MDB Trial Begins