Najib’s 1MDB trial: Day 52

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Datuk Seri Najib Razak’s defence in the ongoing 1Malaysia Development Bhd (1MDB) trial today blamed United States investment bankers Goldman Sachs as the culprits behind embezzlement of the sovereign wealth fund.

Najib’s lead counsel Tan Sri Muhammad Shafee Abdullah said it was obvious there was a sophisticated criminal conspiracy by insiders to defraud 1MDB and Goldman Sachs was the biggest culprit in it.

Former 1MDB chief executive officer (CEO) Mohd Hazem Abd Rahman, 47, however, was not eager to fully agree with the contention made by Shafee during cross-examination at Najib’s trial before High Court Judge Collin Lawrence Sequerah.

“I believe so, based on the reports,” Hazem said from the witness stand.

Earlier, Shafee said it was obvious Goldman Sachs had crafted an elaborate scheme to embezzle 1MDB by working with insiders in the wealth fund, including fugitive businessman Low Taek Jho, better known as Jho Low, former 1MDB executive director Terence Geh, former 1MDB legal officer Jasmine Loo, former 1MDB chief executive Datuk Shahrol Azral Ibrahim and former chief financial officer Azmi Tahir.

However, Hazem said he could not comment on that.

Shafee later continued with his conspiracy theory by pointing out that many dubious and misleading statements had been made by those in the wealth fund which were now proving to be untrue.

It was previously reported that Goldman Sachs had agreed to pay nearly US$3 billion to end a probe of its role in the 1MDB scandal.

The bank’s Malaysian subsidiary also admitted in a US court that it had paid more than US$1 billion in bribes to win work raising money for 1MDB.

US officials had then said the record settlement reflected Goldman Sachs’ central role in a massive corruption scheme.

One of Goldman Sachs’ former partners, Tim Leissner, has also pleaded guilty in the US to conspiring to launder money and violating foreign bribery laws. Another executive is awaiting trial on foreign bribery charges.

Goldman Sachs has also reached a US$3.9 billion settlement with the Malaysian government for its role in the corruption scandal.

Shafee also referred Hazem to a 1MDB’s Director’s Circular Resolution (DCR) which was signed off by the company’s chief financial officer (CFO) Azmi Tahir.

Bernama

Shafee: I want to find out, what I will ask you is disclosure in a way, regarding the conspiracy to mislead 1MDB, that is to profit wrongfully. The aggregate acquisition amount is RM2.75 billion at most, but the bonds raised was US$1.75 billion (around RM5 billion at the material time) which means we have RM5 billion in hand for acquisition at RM2.75 billion which is almost double the amount.

Hazem: Yes.

Shafee: As a person with finance background, having read all the documents present, can you offer a reason why another billion was necessary?

Hazem: From my view, it was not necessary.

Moving on to another topic, Shafee then brought up another DCR in relation to the bonds to be issued by 1MDB Energy Langat (1MEL) which was signed by another 1MDB CEO, Datuk Shahrol Azral Ibrahim Halmi and Azmi.

The document, among others, clearly stated that 1MDB is a sole guarantor, with no mention of International Petroleum Investment Co (IPIC) as a guarantor, even though there was a verbal statement between 1MDB personnel that it would.

In response to this, Hazem said he was not aware of IPIC not being a guarantor (for the bond) at the material time, adding that he only realised this during the current cross-examination.

Shafee said Azmi should have known that IPIC was not a guarantor, also pointing out that Shahrol has made “dubious statements” that there was an “indirect guarantee (from IPIC)”.

Hazem: I think there was an indirect guarantee but I don’t know the structure. From what I have said earlier, the bonds could not be raised unless IPIC is a guarantor.

Shafee: So, there can be an indirect guarantee, but you don’t know how it is mechanised.

Hazem: Yes.

Further questioned by Shafee, Hazem agreed that it was not normal for 1MEL to request its mails to be sent to its Hong Kong office instead of Malaysian office.

Referring to a document from the defence bundle, Shafee said 1MEL has asked Zurich-based Falcon Private Bank to send all mails to its Hong Kong office and asked the witness if he has any idea why 1MEL would want to do this to which the witness replied that he could not comment and was not aware as to who made the directive even though he was one of the signatories of 1MEL.

Hazem also told the High Court he considered Najib to be the “ultimate boss” , and had assumed that 1MDB’s contracts would be given to contractors with ties to then ruling party Umno.

Under cross-examination by Shafee, Hazem said he had first heard from Jho Low that 1MDB’s formation and funds were for the benefit of Umno, during their first meeting at the Shangri-La Hotel in Putrajaya just before Hazem joined 1MDB.

Shafee then asked if Hazem had sought to verify Low’s remarks regarding 1MDB to benefit Umno, suggesting that some individuals would want to boast by making claims that they are doing things for the prime minister or Umno, but Hazem pointed out that Najib’s then principal private secretary Azlin was present in the same meeting and had listened to the conversation.

Asked by Shafee, Hazem agreed that he was fully aware at that time that 1MDB is a company fully owned by the Malaysian government, and that Umno was not and still is not the company’s owner.

Shafee then asked if Hazem realised that there was “something wrong” or “seriously rotten” with the entire 1MDB affair, as 1MDB’s business is supposed to be for the benefit of its shareholder — the Malaysian government — instead of Umno, and if Low’s remarks alerted him that this was “crazy”.

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“I realised that, this company is politically-linked in the sense that it would be used as a vehicle to raise funds,” Hazem replied.

While agreeing that he would not have known of the alleged intended benefits to Umno on that day if Low had not told him, Hazem said he believed he would still subsequently know about this from other individuals such as Azlin.

Shafee went on to suggest that Azlin had kept quiet and “did not expand on the vision of Umno to use 1MDB” when Low made his remarks, further suggesting that only Low whom he said was a “non-member of Umno who can never be a member of Umno tells you it is for the benefit of Umno”, with Hazem replying in the affirmative to both suggestions.

Shafee then asked if Hazem had realised on that day that this would all be against company law and corporate governance, with Hazem then noting: “I don’t know how the company will be used for fundraising, I have certain guesses, certain expectations, yes.”

Shafee: What was travelling in your head?

Hazem: Jho Low did highlight that this company would be involved in TRX. I presume some of the major contracts in the development would be given out to companies that have got political links, that is my expectation.

Shafee: So your expectation was quite innocent, I’m not saying you are innocent or naive, your expectation was you interpreted this consonant with law, namely what this guy meant, perhaps contracts in TRX or subcontracts can be given to Umno-linked companies?

Hazem: Yes.

However, Hazem also confirmed that he had not seen evidence of money stolen from 1MDB being sent to Umno.

Shafee: Have you seen any proof this money has gone back to Umno?

Hazem: During my time? In 1MDB? No.

Najib, 70, is facing four counts of abuse of power for using his position as the then prime minister, finance minister and chairman of the 1MDB board of advisers to receive gratification of RM2.28 billion.

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He is also facing 21 counts of money laundering involving over RM4.3 billion. The trial continues.


Earlier reports:

Jan 5, Najib’s 1MDB Trial: Day 51

Sept 17, Najib’s 1MDB Trial: Day 50

Sept 15, Najib’s 1MDB Trial: Day 49

Sept 14, Najib’s 1MDB Trial: Day 48

Sept 3, Najib’s 1MDB Trial: Day 47

Sept 2, Najib’s 1MDB Trial: Day 46

Sept 1, Najib’s 1MDB Trial: Day 45

Aug 17, Najib’s 1MDB Trial: Day 44

Aug 5, Najib’s 1MDB Trial: Day 43

Aug 4, Najib’s 1MDB Trial: Day 42

Aug 3, Najib’s 1MDB Trial: Day 41

Jul 17, Najib’s 1MDB Trial: Set to Last Until at Least June 2021

Jul 16, Najib’s 1MDB Trial: Day 39

Jul 15, Najib’s 1MDB Trial: Day 38

Jul 1, Najib’s 1MDB Trial: Day 37

Jun 30, Najib’s 1MDB Trial: Day 36

May 21, Najib’s 1MDB Trial: Day 35

May 21, Najib’s 1MDB Trial: Day 34

May 19, Najib’s 1MDB Trial: Day 33

Nov 11, Najib’s 1MDB Trial: Day 32

Nov 7, Najib’s 1MDB Trial: Day 31

Nov 6, Najib’s 1MDB Trial: Day 30

Nov 5, Najib’s 1MDB Trial: Day 30

Nov 4, Najib’s 1MDB Trial: Day 28

Nov 4, 1MDB Trial: Judge Reprimands Najib After Tg Piai Trip

Oct 31, Najib Calls in Sick with Swollen Eyes, 1MDB Trial Postponed Yet Again

Oct 30, Najib’s 1MDB Trial: Day 27

Oct 29, Najib’s 1MDB Trial: Day 26

Oct 24, Najib’s 1MDB Trial: Day 25

Oct 24, Najib Asks Prosecution to Hand Over Justo’s Information Given to MACC

Oct 21, Najib’s 1MDB Trial: Day 24

Oct 17, Najib’s 1MDB Trial: Day 23

Oct 17, Jho Low Changed 1MDB Constitution to Give Najib Absolute Power

Oct 16, Najib’s 1MDB Trial: Day 22

Oct 14, Najib’s 1MDB Trial: Day 21

Oct 10, Najib’s 1MDB Trial: Day 20

Oct 9, Najib’s 1MDB Trial: Day 19

Oct 8, Najib’s 1MDB Trial: Day 18

Oct 7, Najib’s 1MDB Trial: Day 17

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