Arul Kanda: No knowledge if SRC judge involved in 1MDB loan

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Former 1MDB chief executive officer Arul Kanda Kandasamy testified today he has no knowledge of whether SRC trial judge Mohd Nazlan Mohd Ghazali was involved in an RM4.17 billion loan to 1MDB.

The 15th prosecution witness was giving oral evidence in the 1MDB audit trial against himself as well as former prime minister and finance minister Najib Abdul Razak during cross-examination by lead defence counsel Muhammad Shafee Abdullah.

Previously, the Kuala Lumpur High Court granted the prosecution’s bid to turn Arul (above) into a star witness against Najib. However, the court can only decide at the end of the prosecution’s case whether to acquit Arul or not.

During proceedings before 1MDB audit case trial judge Mohamed Zaini Mazlan, Shafee asked Arul several questions about Maybank’s loan of RM4.17 billion to 1MDB, when Nazlan was the general counsel of the commercial bank.

The lawyer’s questions were in relation to Arul’s testimony before the Public Accounts Committee (PAC) in 2015 regarding 1MDB’s financial affairs, which included loans it took from banks.

Arul answered that in relation to the loan 1MDB took from Maybank, he dealt with several bank officers such as Michael Oh-Lau.

When Shafee asked whether these bank officers need approval from their higher-ups for approval on the loan, Arul agreed.

Shafee: Who was the general counsel for the (Maybank) group?

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Arul: I think it was Nazlan, but I never directly in contact with him or met him.

Shafee: Was it Mohd Nazlan Mohd Ghazali?

Arul: Yes.

Shafee: May I suggest that a loan of this size must get approval from the legal side (of the bank)?

Arul: I presumed so.

Nazlan was the Kuala Lumpur High Court judge who in July 2020 convicted Najib over seven criminal charges linked to RM42 million of funds from SRC, a former subsidiary of 1MDB.

The former premier is now serving the related 12-year jail sentence following the apex court upholding the verdict three days ago.

Najib had also previously mounted a failed bid to adduce fresh evidence to nullify the SRC conviction on the reason that Nazlan – who has since been elevated to the Court of Appeal – suffered from a conflict of interest due to his previous job with Maybank.

Later during re-examination by deputy public prosecutor Gopal Sri Ram today, Arul emphasised he does not really know whether Nazlan was even involved in the approval of the loan to 1MDB.

Sri Ram: It was suggested to you that Nazlan had a hand in this (loan to 1MDB)?

Arul: Yes (agreeing that the notion was put to him by Najib’s defence team).

Sri Ram: Do you have personal knowledge of this?

Arul: No.

Proceedings before Zaini will resume on Sept 2.

Najib is charged with using his position to order amendments to 1MDB’s final audit report before it was presented to the PAC to prevent any action against him.

Arul Kanda was charged with abetting Najib in making the amendments.

Muhamad Shahril Rosli/The Star

The charges are framed under Section 23 (1) of the MACC Act 2009, which specifies a jail term of up to 20 years and a fine of no less than five times the amount of gratification or RM10,000, whichever is higher.

The prosecution contended that following the meeting on Feb 24, 2016, a decision was made to remove or alter certain portions of the 1MDB audit report, including dropping the presence of wanted fugitive Low Taek Jho’s (Jho Low) at the fund’s board meetings.

Another issue that was allegedly dropped from the 1MDB audit report was the two conflicting 2014 financial statements of the sovereign wealth fund.

Besides Arul, others who were present at the Feb 24 meeting were former chief secretary to the government Ali Hamsa, former auditor-general Ambrin Buang, former National Audit Department officer Saadatul Nafisah Bashir Ahmad, Najib’s former principal private secretary Shukry Salleh, and then Attorney-General’s Chambers representative Dzulkifli Ahmad. – Malaysiakini