Najib’s 1MDB trial: US$2.7b became US$60,000 in just months but CEO kept mum

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The over US$2.7 billion deposited in a 1Malaysia Development Berhad (1MDB) subsidiary’s bank account in March 2013 dwindled to just US$60,000 within months, with the funds flowing to various companies, including those now known to be controlled by fugitive Low Taek Jho and his associates, the High Court heard today.

Mohd Hazem Abd Rahman, the chief executive of 1MDB from March 2013 to early January 2015, confirmed in court that he did not inform the 1MDB board of the status of the funds in the bank account, including when its balance fell to just around US$60,000.

Mohd Hazem said this while testifying as the 10th prosecution witness during the trial of former prime minister Datuk Seri Najib Razak, who is facing 25 charges involving alleged power abuse and money laundering in relation to more than RM2 billion of 1MDB funds.

Afif Abd Halim/TMI

Najib’s lawyers today focused on 1MDB’s subsidiary 1MDB Global Investments Limited (1MDB GIL), which had raised US$3 billion in March 2013 for a joint venture between 1MDB and Aabar Investments PJS Limited (now said to be a fake company with similar names to an actual Abu Dhabi firm). Both 1MDB and Aabar were supposed to put in US$3 billion each into the joint venture company Abu Dhabi Investment Malaysia Company (Admic).

On March 19, 2013, 1MDB GIL received over US$2.7 billion from the US$3 billion funds it had raised by taking on debts through its issuance of a bond, as the remaining was paid to the bond’s arranger Goldman Sachs.

Yesterday, Mohd Hazem confirmed in court that 1MDB GIL’s bank account that initially had more than US$2.7 billion on March 19, 2013, only had a balance of about US$129.3 million on March 22, 2013, following the outflow of funds that did not have the approval of 1MDB’s board or 1MDB GIL’s board of directors via board resolutions.

The outflows — that left 1MDB GIL with only about US$129 million in just a few days’ time — included hundreds of millions of US dollars transferred as purported “investments” in three fund companies (Devonshire Funds Limited, Enterprise Emerging Markets Fund (EEMF), Cistenique Investment Fund) — now linked to Low.

Under cross-examination today by Najib’s lawyer Wan Aizuddin Wan Mohammed and through reference to minutes of 1MDB board meetings in 2013 and early 2014, Mohd Hazem repeatedly confirmed that he had failed to notify the 1MDB board in multiple board meetings of the status and dwindling amount of the 1MDB GIL funds that were raised specifically for the Admic joint venture.

For example, Wan Aizuddin referred to the minutes of 1MDB’s board meeting on December 9, 2013, which Mohd Hazem had attended.

Mohd Hazem agreed today that the 1MDB board was “genuinely interested” in seeing progress in the 1MDB-Aabar joint venture Admic as they had asked for updates in the previous meeting and this meeting, further confirming that the December 2013 meeting’s records showed that he had told 1MDB directors that no investment had been made by Admic.


Mohd Hazem disagreed that what he told the 1MDB board gave the impression that the US$3 billion raised by 1MDB GIL had been invested into the joint venture Admic, but confirmed that he did not inform the board that the US$3 billion had not been transferred to Admic.

Citing 1MDB GIL’s bank account’s statement, Wan Aizuddin asked: “You would agree as of the board meeting on December 9, 2013, the balance in 1MDB GIL’s account was just a mere US$60,000?” Mohd Hazem confirmed this.

Wan Aizuddin: And this is astonishing, from US$3 billion or even from US$2.7 billion, it has come to US$60,000, and this was never mentioned to the board?

Mohd Hazem: No.

Mohd Hazem similarly confirmed that 1MDB’s then-chief financial officer Azmi Tahir in the same board meeting also did never mention the amount of the balance in 1MDB GIL’s bank account or the whereabouts of the US$3 billion that was raised.

Previously, Mohd Hazem had testified that none of the US$3 billion funds raised was channelled to the Admic joint venture, which later became abortive, as both 1MDB and Aabar did not inject funds of US$3 billion each into the company as originally planned.

He previously testified that 1MDB GIL had to bear losses to make interest payments for the US$3 billion bond while no strategic investments were conducted, while the Malaysian government would ultimately have to bear the burden as it had issued a letter of support for the borrowings.

Najib’s trial before High Court judge Collin Lawrence Sequerah is set to resume next Monday. – MMO

Earlier reports:

May 17, Najib’s 1MDB trial: Ex-1MDB CEO suspected illegal activities between Najib and Jho Low

Feb 15, Najib’s 1MDB trial: Ex-1MDB CEO believes UMNO benefited from 1MDB

Feb 15, Najib’s 1MDB trial: 1MDB’s senior executive meetings held in Jho Low’s apartment

Feb 10, Najib’s 1MDB trial: Najib claimed Saudi prince “donated” to 1MDB’s charity arm

Feb 9, Najib’s 1MDB trial: Najib received RM2.973b from 1MDB

Feb 9, Najib’s 1MDB Trial: Jho Low known as “PMO” in 1MDB board meetings was “the man”

Feb 8, Najib’s 1MDB Trial: Ex-CEO says in 1MDB, you either follow instructions or quit

Jan 6, Najib’s 1MDB trial: Day 52

Jan 5, Najib’s 1MDB Trial: Day 51

Sept 17, 2020, 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, 2019, 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