Najib’s 1MDB Trial: Day 17

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Shahrol says Low liked him for not being a busybody.

9.37am: Court is in session.

9.38am: The proceedings begin with former prime minister Najib Razak’s lead counsel Muhammad Shafee Abdullah beginning the cross-examination of former 1MDB CEO Shahrol Azral Ibrahim Halmi.

Najjua Zulkefli/TMI

Najib is seen sitting in the dock as Shafee questions the prosecution’s ninth witness.

9.40am: Shafee questions Shahrol over his education record.

He is asked about his performance at the Royal Military College (RMC) in Sungai Besi, where Shahrol attended secondary school between 1981 and 1987.

According to the witness, he did “quite well” in RMC, having bagged the Director of Studies’ Award when he completed Form 5 in 1987. Shahrol was in the science stream during his secondary education.

For the record, the Director of Studies award is the recognition for the school’s top student in academics.

9.44am: Shahrol says he scored A1 in Additional Mathematics, Physics, Chemistry, Biology, English, Islamic Studies and Geography in his SPM examination, except Bahasa Malaysia, where he got a Credit 6.

“As with all 17-year-olds, I didn’t know what I wanted to do. I liked working with my hands. I thought engineering was an interesting subject to study.

“After receiving my SPM, I was offered various scholarships to the UK and to the US,” he says.

Shahrol says he did his pre-university education at Citrus College, Los Angeles.

Shafee: Before you went to university, the five years in military college taught you to be very independent.

Shahrol: Not necessarily. I think the biggest takeaway for me from RMC was the importance of the chain of command.

The witness, however, agrees that the nature of his training at the college had taught him not to take everything blindly.

For the record, it is also worth noting that Shafee is also a former RMC student, or known as ‘Old Putera’.

9.50am: Shahrol says he went to Stanford University in Palo Alto, California.

He says at the time, Stanford was one of the top three universities in the US for Engineering, but he did not do so well.

“To tell you the truth, I barely graduated,” he says.

9.53am: Shahrol says he only made the minimum requirements to graduate and did not graduate with the American equivalent of an honours degree known as “cum laude”.

He graduated with a Bachelors of Science in Electrical Engineering.

Upon graduation, he says he was hired by Anderson consulting which later became Accenture.

Starting at the company as an intern in 1995, Shahrol then built up his career to become an analyst, manager, senior manager, and eventually a partner-level executive with a drawn salary of close to RM30,000 before resigning in 2009.

10.21am: Shahrol says he met Low when he was at Accenture in 2007.

He says he received an SMS from Low.

“He messaged me saying he wanted to do something with his company’s systems and asked me to drop by his office to discuss.”

He says Low got his contact from Shahrol’s Stanford roommate.

Shahrol says he met Low after the text message.

10.25 am: Low was the managing director of Utama Banking Group at the time.

Shahrol says: “I met him to see what he wanted. He wanted to professionalise the investment process in UBG.”

He says it involved identifying, filtering and documenting UBG’s potential investments and current investments.

Low was 26 at the time.

10.31am: Shahrol says Low was always late but well-spoken and understood concepts quickly.

10.34am: The witness says Low articulated things very well and the quality of the discussions was quite high.

Shafee: At that time, Low didn’t show you any semblance that he was a trickster or a fraud?

Shahrol: No. Not at all.

10.36am: Shafee is asking Shahrol about paragraph two of his witness statement, where he states that “…Jho Low assessed on my character and personal (aspect) as only carrying out client’s orders without asking many questions.

The paragraph in question deals with the time that Shahrol, then managing director at Accenture, first met Low in 2007.

Shahrol: What I intended to convey at the time was that Jho Low pegged me as someone who is…I am struggling to find the words here…the word that comes to mind is “kepochi”, busybody is more appropriate here.

Shafee: He (Jho Low) liked your character of just taking instruction without knowing the ultimate journey?

Shahrol: Not quite. I just took enough information necessary to deliver the outcome as I understood it. Anything other than the outcome not relevant to the task at hand, I trusted other people to look at it.

10.45am: Shahrol now details what happened when he was called in by the police and the Malaysian Anti-Corruption Commission (MACC) during investigations into 1MDB.

11.33am: Shahrol says shortly after the general election last year, the government had imposed a travel ban on him.

He says he has been banned for more than a year.

Shahrol says it has become a burden because it is hard for him to find employment now.

Shafee: Didn’t you ask the MACC why you were banned?

Shahrol: I assumed it is because of 1MDB (case).

He says that he made this assumption because he was part of the group of people that included former 1MDB directors and senior management that were banned from travelling.

Shahrol: It was to prevent people with information on the case from disappearing.

Shafee: They (authorities) wanted to prevent you from disappearing?

Shahrol: Yes.

Shafee: You were regarded as a flight risk?

Shahrol: I do not know.

11.40am: Shahrol says at the end of 2008, Low messaged him to ask if Shahrol was interested in taking up a role at 1MDB, then Terengganu Investment Authority (TIA).

Shahrol: I said I’m always interested to explore but I asked is there anything that Accenture can do for the new fund. Low went quiet for a while until March 2009, when he asked me to present myself to the Terengganu royalty.

12pm: Shahrol says the fund was initially set up to create sustainable development for Terengganu, focusing on oil and gas, tourism, real estate and agriculture.

12.12pm: Shafee suggests that Goldman Sachs has been involved from before TIA’s formation.

Shahrol says it is true.

Shahrol testifies this based on documents related to the company which had been tendered as evidence in court.

This includes a Request for Proposal document dated March 9, 2009, which shows that TIA had received proposals from Goldman Sachs, JP Morgan and Nomura.

Shafee: At this early stage of TIA, Najib was not involved, with Goldman Sachs already there with another consulting firm, and with advice from Jho Low?

Shahrol: Yes.

Shafee: Jho Low was there to ensure his advice is followed. You attended (related meetings) and you know about Jho Low’s idea. Jho Low supported the appointment of Goldman Sachs and Jho Low pushed for it?

Shahrol: Yes.

12.30pm: Shahrol agrees to a question posed by the defence that TIA was the brainchild or “baby” of the then Yang di-Pertuan Agong Tuanku Mizan Zainal Abidin.

Shafee: The idea of TIA was mooted when Low took the Terengganu sultan to Abu Dhabi? Najib was nowhere on the horizon?

Shahrol: I agree but I don’t know whether Low was already talking to Najib.

He also agrees that it would be wrong for anyone to suggest that it was the idea of Najib to create TIA as a sovereign wealth fund for Terengganu and then to federalise the company.

Shafee: Can you confirm from your observation, that the Yang di-Pertuan Agong (then), (who is also) the Sultan of Terengganu, was very impressed with Jho Low?

Shahrol: It was a very short observation of the interactions between Jho and the Agong, which was then only about a couple of times in the istana (palace). But from the way Jho was conducting himself in the istana, I can see at least they were familiar (with each other) and he had the approval of the Yang di-Pertuan Agong at that time.

Kamal Ariffin/TMI

The court also hears that Jho Low had the influence to secure an offer letter for Shahrol to become TIA’s first CEO just over a weekend after being interviewed on a Friday in March 2009.

12.50pm: Shahrol says he began to doubt Jho Low only around 2015 while he did not doubt Low in 2009.

Shafee: As a (TIA and 1MDB) CEO, if you had implicit and explicit trust (in Jho Low), you would not blame my client the former prime minister (Najib). You yourself got conned (by Jho Low).

Shahrol: I would not blame him (Najib).

Shafee: You cannot say he (Najib) must be a culprit in the conspiracy?

Shahrol: It was not my place to say anything.

Shahrol says he trusted Low because the main drivers for TIA were already in place and what he observed was Low was one of those who had the trust of key players.

Kuala Lumpur High Court judge Collin Lawrence Sequerah adjourns proceedings for lunch break.

2.38pm: Proceedings resume.

2.55pm: Shafee asks Shahrol about a civil suit the government has taken against the 1MDB board. Shahrol says he is not worried as he is telling the truth.

2.59pm: Shahrol testifies that during the Public Accounts Committee (PAC) hearing at Parliament in 2015, he was unable to provide full answers as he was kept getting cut off during questioning by the panel.

Shafee then asks Shahrol why he did not do anything about it in regards to being cut off during questioning by the PAC panel led by Rompin MP Hasan Arifin.

Shafee reminds Shahrol that the PAC later came to the conclusion that the witness should be investigated for decisions made without the consent of the 1MDB board.

Shahrol: I was (in) Team Najib, I was playing my role.

Shafee: How could you be Team Najib when you were condemned?

Shahrol: Even at that time, I trusted Najib and before all these other things came up, I was shown the money flow and the account. I still believed him (Najib) and that there was a political attack against him.

I trusted Najib and his team that this was a political attack against him, and I trusted that what I did as (1MDB) CEO was in accordance to Najib’s wishes for the good of the country.

Shafee: You believed this aspect, what you just said that you trusted Najib which implies what was done in 1MDB was right?

Shahrol: Yes, right for the good of the country.

3.10pm: The court hears from Shahrol that the company had suffered problems with its initial public offerings (IPO) due to “a lot of negative media attention” created by the then opposition parties.

Shahrol in his testimony agrees that the negative attention had prevented the IPO from happening.

He says if the IPO had taken place, 1MDB’s situation would have turned better.

Under cross-examination by Shafee, Shahrol says 1MDB would have been able to generate enough funds to acquire IPPs (independent power producers), which could then be used to expand its energy business.

“So, it would be quite something and we wouldn’t have this cash flow issues. Bandar Malaysia (project) would have proceeded, TRX would have been on time, all these were supposed to happen in 2017,” Shahrol says.

Answering questions by Shafee later, Shahrol says that the initial target for the 1MDB to raise from the IPO was “something between RM20b and RM25b” total market cap.

He adds that 1MDB would have only floated about one-third of the amount.

Shahrol says that this amount, however, is based on his best recollection from when he left 1MDB in 2013.

The witness then agrees with Shafee’s suggestions that without the negative publicity by the then opposition, the 1MDB IPO plans would have worked out and that the country would not suffer from the company’s failure today.

3.22pm: Shafee is now going through energy ventures the government made in the past.

3.37pm: Shahrol denies a question from Shafee whether he was the so-called 1MDB Officer 2, who allegedly had beneficial ownership in shell companies.

Shafee is referring to Tim Leissner’s allegation when the former Goldman Sachs banker pleaded guilty to criminal charges of conspiring to commit money laundering and to violate the Foreign Corrupt Practices Act last year.

Shafee claims that in pleading guilty, Leissner had alleged that he received money from Jho Low and caused these funds to transfer to shell companies beneficially owned by 1MDB Officer 2, whom Shafee claims was Shahrol.

Shahrol: I was not aware.

Shafee: This is Tim Leissner’s (claim) in mitigation (for a lighter sentence from the United States court). You have to respond (whether you are) the beneficial owner ‘1MDB Officer 2’?

Shahrol: I do not have shell companies where I am the beneficial owner.

4pm: Shahrol says if he had known that Low was misappropriating SRC International money, he would have notified the board so action could be taken.

4.15pm: The court hears that Shahrol received instruction from Jho Low to delete emails and Blackberry Messenger chats between them.

This is similar to what a previous witness, Amhari Efendi Nazaruddin, had told the court.

Amhari was a special officer to Najib when he was deputy prime minister and prime minister.

According to Shahrol, Jho Low told him that they had to delete all their emails and chats due to political attacks and to protect “the boss”. While he did not elaborate who the boss was, it is believed he was referring to Najib.

Shahrol also testifies that he received two Blackberry devices from Jho Low, including one which he donated for a lucky draw at one of the 1MDB dinner events.

4.27pm: Shahrol testifies that Jho Low wanted to keep his involvement in 1MDB under wraps to prevent Najib Abdul Razak’s position from being weakened in Umno.

The ninth witness says Jho Low told him that his involvement from 2009 to 2011 needed to be kept under wraps as many within Umno were jealous of Jho Low’s access to Najib.

“It started being a problem when Najib became the sole stakeholder in 1MDB and there was a lot of ‘perasaan dengki’ (jealousy) from people within Umno over Jho Low’s influence and access to Najib.

“It made sense to me when Jho Low informed me that his involvement needed to be kept low-key as to not weaken Najib’s position in Umno. I accepted this explanation (from Jho Low).

“In 2009, 2010 and 2011, not many people knew Jho Low was playing a big role in Najib’s relationships with Saudi Arabia, Abu Dhabi, and even the Chinese at the time,” Shahrol testifies.

4.32pm: The trial is adjourned for the day and will resume at 9.30am tomorrow.

Earlier reports:

Oct 7, Some Umno People Envious of Jho Low-Najib Ties, Court Told

Oct 1, Najib’s 1MDB Trial: Day 16

Oct 1, Arul Kanda Told Ex-1MDB CEO to Leave Country to Avoid PAC Meeting

Oct 1, Ex-1MDB CEO Paid RM99K Monthly, RM1.5M Bonus

Oct 1, Jho Low Helped Plan Abu Dhabi Crown Prince’s Trip to Sway Voters for GE13

Sept 30, Najib’s 1MDB Trial: Day 15

Sept 30, Witness: Najib Used 1MDB to Raise Funds for GE13

Sept 26, Najib’s 1MDB Trial: Day 14

Sept 26, Jho Low, Tim Leissner Played “Matchmaker” for Najib to Meet Goldman Sachs

Sept 26, US$9M Transferred from Jho Low’s Good Star to Riza Aziz’s Red Granite Pictures

Sept 26, Jho Low, Najib Faked Meeting Minutes to Move US$750M from 1MDB to PSI

Sept 26, Najib Agreed to 1MDB Borrowing RM3B from SOCSO to Lend to PetroSaudi

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 18, Najib’s Ex-Aide Led MACC to Raid on Jho Low’s Apartment

Sept 18, Najib’s 1MDB Trial Halted Briefly for Najib to See Eye Specialist

Sept 17, Najib’s 1MDB Trial: Day Eight

Sept 17, Witness Identifies Riza Aziz, Arul Kanda and Five Others as Key Players in 1MDB Saga

Sept 17, Bono, Queen of Jordan, Rosmah Floated as Trustees for TIA

Sept 17, Witness Says 1MDB Najib’s Baby, Defence Claims It Was Terengganu Sultan’s Idea

Sept 11, Najib’s Eye Infection Halts 1MDB Trial

Sept 10, Najib’s 1MDB Trial: Day Six

Sept 10, Rosmah Fond of Jho Low

Sept 10, Najib’s Ex-Aide: Jho Low Provided Scripted Responses to Deny His Involvement in 1MDB

Sept 10, Istana Negara Questioned Jho Low’s Role in 1MDB Predecessor TIA

Sept 5, Najib’s 1MDB Trial: Day Five

Sept 5, 1MDB Trial: Judge Raps Shafee over Najib’s Tardiness

Sept 5, 1MDB Trial: Najib’s Ex-Aide Took US$200K Loan from Jho Low to Buy Property

Sept 5, 1MDB Trial: Najib’s Ex-Aide Accused of Lying

Sept 4, Najib’s 1MDB Trial: Day Four

Sept 4, Najib’s Ex-Aide: Mudabala CEO Was Promised All Sorts of Things

Sept 4, Najib’s Ex-Aide, Jho Low on “Secret China Mission” to Bail Out 1MDB

Sept 4, Jho Low Ordered Najib’s Ex-Aides to Open Overseas Bank Accounts

Sept 3, Najib’s 1MDB Trial: Day Three

Sept 3, Najib’s Ex-Aide: Jho Low Drew Out Wealth Fund Concept on Kitchen Whiteboard

Sept 3, Jho Low Gave Possibly Forged Letters from Saudi Arabia to Stop 1MDB Probe

Sept 3, Only Najib and Jho Low Knew “Full Picture” of 1MDB Plan

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, Shafee: Prove Najib Knew Arab Donation Letter Faked, Jho Low Is Najib’s Alter Ego

Aug 28, Najib’s 1MDB Trial: Shafee Again Questions Sri Ram’s Appointment

Aug 28, Najib’s 1MDB Trial: Gopal Sri Ram’s Full Opening Statement

Aug 28, Najib’s 1MDB Trial: Prosecution to Show Saudi Donations a Sham

Aug 28, Najib’s 1 MDB Trial: Prosecution to Prove Jho Low Was Najib’s Alter Ego

Aug 28, Najib’s 1MDB Trial Begins