Bank Negara took seven years to trace 1MDB funds to Jho Low’s firm, Zeti tells court

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Span of time not unusual as it takes years to detect such cases.

Former Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz told the High Court that the central bank took seven years to discover that some US$700mil from 1Malaysia Development Bhd (1MDB) coffers were diverted to Good Star Ltd, a company linked to Low Taek Jho or Jho Low.

Zeti said, however, that this span of time was not unusual.

“It is very common to find out (after so long) from financial regulators worldwide as it takes years to detect such cases.

“It is a cumulative effort from all regulators all over the world, as well as internal investigation on the money trail,” she said here on Wednesday (Aug 16).

The 46th prosecution witness was answering a question from former prime minister Najib Razak’s lead counsel, Tan Sri Muhammad Shafee Abdullah, who remarked that seven years was “a long time”.

Zeti was on the stand for cross-examination by Muhammad Shafee in Najib’s RM2.28bil 1MDB graft trial.

“When Bank Negara’s supervisory team went in March 2015 (for investigation based on intelligence from foreign financial regulators), they uncovered (that) it went to Good Star.

Bernama

“The next inquiry was to identify who was the owner of Good Star and it was later revealed that it was owned by Low,” she said, referring to the fugitive financier.

The US$700mil was part of a US$1bil remittance that was supposed to go into two accounts; US$300mil into a JP Morgan SA account for 1MDB Petrosaudi Ltd (1MDB-Petrosaudi) and US$700mil into an RBS Coutts Bank Ltd account for PetroSaudi International (PSI) Ltd, for the purpose of a joint venture between 1MDB and PSI.

In an earlier proceeding, Zeti told the court that the investigation on 1MDB began after it received intelligence from foreign financial regulators in 2015 that claimed there was misappropriation of the company’s funds.

Bank Negara then initiated its own investigation after failing to get satisfactory answers from 1MDB’s top officers and Najib himself, who was the finance minister then and adviser to 1MDB.

Najib, 70, is on trial for 25 charges in total: four for abuse of power that allegedly brought him the financial benefit to the tune of RM2.28bil; and 21 for money laundering involving the same amount of money.

The hearing continues on Thursday (Aug 17) before Justice Collin Lawrence Sequerah. – The Star