AmBank Group purposely hid facts from 1MDB on Aktis Capital and Country Group being secondary subscribers of 1MDB bonds in 2009.
9.46am: Accused Najib Razak steps into the dock as proceedings begin, with former 1MDB CEO Shahrol Azral Ibrahim Halmi in the witness stand ready to be cross-examined by lead defence counsel Muhammad Shafee Abdullah.
9.50am: The hearing starts with the prosecution calling some nine witnesses into the court for identification by Shahrol.
They include former 1MDB chairpersons Bakke Salleh and Lodin Wok Kamaruddin, former 1MDB director Ismee Ismail, Najib Abdul Razak’s former aide Wan Ahmad Shihab, former 1MDB chief financial officer Azmi Tahir, 1MDB’s former company secretary Lim Poh Seng, police investigator Rajagopal, and Goh Gaik Kim.
Shahrol then identifies all of them in court for record purposes.
9.57am: Shahrol and Shafee verbally spar over whether Shahrol had tried to find out what happened to 1MDB’s RM5 billion bond issue in 2009.
It happens during cross-examination when Shafee asks Shahrol whether he had queried AmBank, which was arranging the bond issue, on the breakdown of the bond issue.
When Shahrol answers “I do not know”, Shafee reminds the witness that he, as then 1MDB CEO, had the right to ask about it.
Shahrol: I did not (ask) at the time.
Shafee: You have the right to ask.
Shahrol: I do not know. You are telling me as a defence counsel. I need advice from counsel (prosecution).
Shafee: Why do you need to ask (prosecution)? You were 1MDB CEO.
Shahrol: I do not know.
Matters calm down when Shahrol reveals that the 1MDB board on two occasions in 2009 called AmBank to explain the matter.
10.15: Shafee is asking Shahrol about Jho Low’s role in 1MDB meetings.
“He (Low) was the sole link between 1MDB, me and sole shareholder Najib,” Shahrol testifies.
When Shafee asks who was the sole shareholder of 1MDB in 2009, he replies it was Minister of Finance Incorporated.
Najib was finance minister and later prime minister in 2009.
10.13am: Shahrol confirms he has never met Bank Negara officials over the bonds’ issuance.
He says he was told by Low and AmBank relationship manager Joanna Yu that they have met central bank officials.
Shahrol confirms he never told the board that it was only Low and Yu who met Bank Negara officials.
He agrees with Shafee’s suggestion that the TIA board was probably under the impression that it was Shahrol who met with central bank officials.
10.06am: Shahrol confirms Goldman Sachs Singapore was appointed as financial advisor for the TIA bonds issuance, referred to as the Islamic medium-term notes (IMTN).
He says only former chairman of 1MDB’s board of directors Bakke Salleh pointed to the difference in the amount raised from the IMTN, which was RM5 billion, and the amount received by TIA.
10.30am: AmBank Group purposely hid facts from 1MDB on Aktis Capital and Country Group being secondary subscribers of 1MDB bonds in 2009, Shahrol tells the court.
He, however, declines to speculate on why the bank might have wanted to do so.
Shafee: So, you are going on record that you were never informed by Ambank that Aktis and Country Group was involved as secondary subscribers?
The witness then agrees to a suggestion by Shafee that given the hindsight of the situation now, AmBank had purposely hidden the facts.
Earlier, Shahrol testifies that 1MDB board of directors had in Oct 2009 summoned AmBank to explain why 1MDB only received some RM4.3 billion for its RM5 billion Islamic medium-term notes (IMTN), instead of its face value.
He says that presentation by AmBank to the board did not reveal about Aktis and Country Group being 1MDB’s secondary board subscribers.
According to Shahrol, they were only told that 1MDB bonds were subscribed by the EPF, Socso, and insurance companies.
The witness adds that the most vocal board member who queried about the IMTN value was 1MDB chairperson then, Bakke Salleh.
10.44am: Judge allows a break for the witness to go over some documents.
11.20am: The court hears that a company linked to Jho Low, Aktis Capital Singapore Ltd, had made about RM83 million in just a few days by subscribing to 1MDB bonds at a discounted price before reselling it at face value.
According to the document presented in the court during defence’s cross-examination on Shahrol, Aktis had made secondary subscription of 1MDB Islamic medium-term notes (IMTN) worth RM700 million for only slightly above RM617 million in May 2009.
This was done through AmBank Group, which was the primary subscriber of 1MDB bonds up to RM5 billion.
The difference in amount went to fees involved in the deal, including some RM70,000 which AmBank made as a placement agent for Aktis.
11.35am: Judge Collin Lawrence Sequerah gets annoyed at someone whose phone went off during proceedings.
The judge, lawyers and DPPs turn their gaze to the front row of a public gallery, where a woman is seen trying to switch off her smartphone which was ringing for 20 seconds.
He tells the court registrar to tell the people seated at the public gallery that if it happens again, he will confiscate all phones and bar them from being in the courtroom.
Shafee continues his cross-examination.
Shafee suggests that Low’s group made about US$120 million overnight for his company.
Shahrol says Low had not told the board about these “secret arrangements”.
Shahrol agrees that someone in AmBank could have been pulling the strings to sell 1MDB bonds at a discounted price to a company linked to Jho Low in 2009.
Shahrol testifies this when he is being cross-examined by Shafee on what transpired in May 2009 which saw 1MDB only receiving RM4.3 billion for the issuance of its RM5 billion bonds.
The witness agrees to a suggestion by Shafee that it could not be AmBank as an entity which sold RM700 million worth of 1MDB bonds at a discounted price to Aktis Capital Singapore Ltd, but rather someone inside it.
This was due to the fact that AmBank could have made a profit by selling the bonds to other companies at its face value.
According to an agreement document between AmBank and Aktis as the bonds’ secondary subscriber, the bank only made some RM70,000 from its fees as a placement agency for Aktis.
Shafee: I won’t accuse Ambank as a whole. I say someone in Ambank. So Ambank suffered a loss. Profit was made by some people.
11.52am: Shafee suggests Low was in the habit of drafting sham agreements to dupe the government.
12.20pm: Shahrol says that Sultan Mizan Zainal Abidin was probably referring to Jho Low when the ruler uttered the “unsavoury character” remark during a meeting in 2009.
The witness is referring to a meeting on May 22, 2009, when the sultan was said to be upset and ordered for suspension of Terengganu Investment Authority (TIA) bonds issuance.
Shahrol testifies that he believes this was probably the case, given the hindsight of the situation.
However, Shahrol adds he could not say for sure as he cannot speak for Sultan Mizan, who was then the Yang di-Pertuan Agong.
12.23pm: Shafee suggests to Shahrol that Low was the one who told Najib that cancelling the TIA bonds would look bad on the government.
Shahrol agrees it was Low who suggested it.
12.26pm: Shahrol says Najib had asked him why the Terengganu royalty was angry at Low.
12.27pm: Shahrol adds he was made by the former Agong to sign a TIA resolution to cancel the issuance of the bonds, also in May 2009.
After that, Shahrol testifies that he met Najib at his house in Langgak Duta.
“When he asked me why the Agong was murka (displeased) and I replied I did not know… I do not recall bafflement, very neutral,” he says.
When Shafee asks if this meant Najib then did not know the reason for the royal displeasure, Shahrol agrees.
12.40pm: Judge Sequerah allows proceedings to adjourn for lunch.
2.38pm: Court resumes its session.
3.05pm: Shafee suggests Low’s dealings with AmBank were serious allegations made by The Edge newspaper.
Shafee says it has become a public issue. He then shows the witness a story published in The Edge on February 4, 2019.
The article says two companies linked to Low secretly bought TIA bonds at a discounted price and then resold them for a profit of close to RM500 million.
3.12pm: Shahrol agrees with the defence’s contention that Jho Low avoided signing signatures on 1MDB-linked documents to avoid being implicated in any probe.
Shafee: It is surprising that Jho Low’s signature has not appeared anywhere?
Shafee: Using nominees, he (Jho Low) himself has not made any personal appearance via signature or anything of that sort?
Shafee: He does not want any investigation to point to him and he disavows any knowledge or undertaking, hence no signature?
Shahrol: It’s possible.
3.35pm: Shafee questions Shahrol whether he has any evidence that Najib was aware of Jho Low’s manoeuvrings on the Pulau Bidong project, where Low allegedly kept Shahrol and Najib in the dark.
Shafee: Do you have any evidence? The fact that he (Jho Low) made a profit under your nose, do you have evidence that the PM (then prime minister Najib) knew?
Shahrol: I have no evidence.
During this exchange, lead DPP Gopal Sri Ram reiterates that it is the prosecution’s stance that Najib had knowledge about the matter.
4pm: The court hears that Terengganu Menteri Besar Incorporated (MBI) had removed Shahrol Azral Ibrahim Halmi as TIA CEO in May 2009.
During Shahrol’s cross-examination, Shafee displays an ordinary shareholder resolution by Terengganu MBI dated May 27, 2009.
The resolution stated that Terengganu MBI had disagreed with the issuance of TIA bonds, for which they listed several reasons, and that they decided to remove Shahrol from his position in TIA.
Shahrol confirms his removal by Terengganu MBI but says that he never knew the reason.
He says that he was never told the reason until today.
4.03pm: They go through the minutes of a cabinet meeting where an RM5 billion bond from TIA.was approved.
4.30pm: Judge Sequerah allows proceedings to adjourn for the day and to resume tomorrow morning.
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