Najib’s SRC Trial: Day 12

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SRC sought RM3.95 billion KWAP loan.

Chronology of Events:

10am: The trial has yet to commence even though it was scheduled to start at 9.30am.

Najib arrived in court some time ago with some supporters.

Firdaus Latif

10.08am: Clad in a dark blue suit, Najib enters the courtroom and takes a seat in the front row of the public gallery.

10.15am: Justice Sequerah agrees to vacate the dates for the 1MDB trial for May and June for the SRC International trial on condition that the 1MDB trial begins by mid-August.

The 1MDB trial is now set to start on August 19 and will proceed until November 14.

Defence lawyer Muhammad Shafee Abdullah receives permission to vacate certain dates in early September as he will be representing the widow of the late Cradle Fund CEO.

Attorney-General Tommy Thomas and V Sithambaram enter the court and take their seats on the prosecution bench.

10.25am: Najib enters the dock as proceedings begin before judge Mohd Nazlan Mohd Ghazali.

Azneal Ishak/Malaysiakini

Thomas explains to Nazlan what happened with judge Sequerah earlier.

10.30am: Thomas tells Nazlan that they can add additional dates for the SRC trial if need be, which is slated to end on June 21 as the 1MDB trial only begins on August 19.

Shafee is giving Nazlan reasons why the trial should not continue on Friday.

Nazlan says he is agreeable to the suggestion provided that the defence can replace those dates.

Thomas says if that is done, it will shrink the trial length because they may not be able to replace all dates.

Prosecution and defence are arguing over the dates. Shafee wants Friday off to manage other works in the office, while Tommy says it is unfair to keep postponing the Fridays.

Shafee: I can’t neglect other works in the office. In the meantime, I also have to be considerate about my Muslim clients. I can’t bother them after 6pm as this would affect their maghrib prayers.

10.40am: The first witness for the day takes the stand.

Daman Huri Nor works in the Prime Minister’s Department as a secretary and his job scope is to take care of Parliamentary matters concerning the department and the prime minister.

Seth Akmal/TMI

He is questioned by DPP Muhammad Izzat Fauzan.

The rapid delivery of the 25th witness forces prosecution and defence lawyers to ask him to slow down.

Alyaa Alhadjri/Malaysiakini

“Please slow down as we are trying to write it down. Thank you,” Najib’s lawyer Harvinderjit Singh says, before sitting down.

Taken aback, Daman continues his testimony at the same speed, prompting DPP Mohd Ashrof Adrin Kamarul to remind him that both the prosecution and defence cannot keep up.

The witness continues speaking rapidly, which causes the defence to calmly remind him to slow down yet again.

“Daman, usually you see Yang Arif listening to the story first, but the rest of us need to write.

“When you are testifying, please observe our hands as we write,” Shafee reminds Daman.

Daman finally slows down and testifies on various government appointments prior to the 14th general election.

10.50am: Daman is asked to verify a document which states that Najib was appointed as a public servant.

The document says Najib was a youth and sports minister in 1986 and goes on to detail all the ministries the former prime minister had helmed in his tenure in government.

He is also verifying Najib’s appointment letter as prime minister in 2009.

11am: Daman says there is no appointment letter of Najib taking the role of finance minister. The witness is let go from the stand.

The next witness taking the stand is 42-year-old Farah Nordiana Azhar, an administrative officer in Parliament.

She has prepared a written statement that was also read to the Malaysian Anti-Corruption Commission (MACC).

11.15am: The 26th witness, Farah says her role in Parliament is to manage the allowances of members of Parliament.

Firdaus Latif

11.30am: The next witness to take the stand is Zarinah Yusuf, the deputy head of accounting in the Prime Minister’s Department.

The 27th witness, Zarinah says her job is to make sure salaries and bills are paid, that includes paying the wages of all ministers in the Prime Minister’s Department, the deputy prime minister and the prime minister.

Azneal Ishak/Malaysiakini

She says the MACC had asked her to surrender Najib’s payslips to an investigating officer named Rosli.

Zarinah is verifying Najib’s payslips from January 2009 to March 2018.

11.40am: When Najib became prime minister, his monthly salary was RM58,605.15.

In May 2018, Najib received an RM1 million special payment. Zarinah says she is unsure of the reason behind the special payment but it was in accordance to the law.

It was only in May 2018, Zarinah tells DPP Izzat, that Najib made just RM6,627.09, prorated for his nine days in office.

Najib’s salary was deposited into his Affin Bank account.

Izzat asks Nazlan for a five-minute break.

The judge agrees and the court stands down for five minutes.

12pm: The next witness is Kamariah Noruddin, 61, director of the Economic Planning Unit and also director of services in the Prime Minister’s Department.

12.15pm: The 28th witness, Kamariah tells the court that there was an application from Najib’s executive officer in 1MDB in 2010 and it was addressed to then finance minister Najib. She says that this was “out of the ordinary” and the application was CC’ed to other ministers as well.

She says the letter on Aug 24, 2010, requested RM3 billion to start SRC International, a special vehicle to acquire strategic stakes in key resource areas such as in coal and iron.

1MDB claimed at the time that SRC International will invest in strategic resources such as minerals, energy and metals.

12.20pm: “I was instructed to look into the request by the director of the unit, Noriah Ahmad, to study this and come up with a response,” Kamariah tells the court.

She says she had prepared a review of the request addressed to Najib and will read it out to the court.

According to Kamariah, the EPU held that Petronas should handle energy matters, while the private sector should handle the iron and aluminium business.

12.25pm: “We support the proposal 1MDB to start SRC International to invest in coal and uranium, but we objected to investing in petroleum and gas as it was already done by Petronas. The grant of RM3 billion was rejected. But we allowed a grant of RM20 million.

“The RM20 million was allowed basically for the starting of SRC International, for due diligence and also to hire the talent they required.”

She says the memo was sent to the PM’s Department and she received a response a few days after that.

12.30pm: Kamariah says the PM’s Department agreed with the RM20 million grant to start up SRC International.

She says she was then instructed to inform 1MDB that the PM’s Department had accepted the EPU’s proposal.

12.33pm: Harvinderjit says the defence was not informed of Kamariah’s appearance today and asks for an early lunch break so he can prepare documents for his cross-examination of the witness.

Nazlan allows the early lunch break and says the trial will resume at 2pm instead of 2.30pm.

2.14pm: Court resumes after break. Harvinderjit begins cross-examining Kamariah.

2.30pm: Harvinderjit is going through the timeline of events with Kamariah as to when 1MDB asked for the RM3 billion.

2.35pm: Kamariah agrees that a government grant means that there’s no expectation that the money will be returned.

2.43pm: Harvinderjit asks what does the RM20 million launching grant mean.

Kamariah says this was given to undertake due diligence and to hire talent.

Harvinderjit: The provision of RM20 million was to help them get their foot in the door for energy?

Kamariah: Yes, and also to undertake feasibility studies into coal and uranium.

2.45pm: Harvinderjit asks if the EPU supported setting up SRC.

She says there were plans to set up two big coal plants under the 10th Malaysia Plan, the unit supported investments in coal.

2.52pm: Harvinderjit asks Kamariah about a meeting she had with 1MDB executives to discuss SRC’s way forward.

She says 1MDB’s vice president of business development and other staff were there.

2.56pm: Shafee begins to cross-examine Kamariah.

Shafee: It would be a serious proposal if you submit a grant (request) to the prime minister, if it is not serious, an entity would not submit it to the prime minister. This was addressed to the PM and the minister of finance.

Kamariah: Yes.

3.13pm: Shafee: At one time, did the government consider that this was a strategic investment in the iron and steel industry?

Kamariah: But, we cannot rely so much on this, we have to look at the development of the industry. We have to see what’s the industry like. At that juncture, we opined that the private sector don’t get involved.

Shafee: Now we go into oil and gas. Will you agree with me it is a monopoly of Petronas, the answer is obviously yes?

Kamariah: Yes, yes, it probably was.

3.16pm: Kamariah explains coal investment

Kamariah: You have to bear in mind, for the import of coal, independent power producers were dependant on TNB to import coal. They didn’t have resources to import. If TNB imported for all, they would get a better price.

Shafee: Let’s not go into that. Is TNB a monopoly? Was it a good thing for 1MDB to go into coal?

Kamariah: Yes.

3.20pm: Shafee now touches on uranium investments, and reads the EPU letter supporting ventures in the sector.

3.23pm: Shafee: Your department decided that they agree with coal and uranium investments and the set-up of SRC International. But you said, no, to an RM3 billion grant. You said it because they (SRC) should go and get loans from the commercial market so that they are competitive internationally.

Kamariah: Yes.

3.32pm: Shafee: As a general rule, the EPU’s (view) is respected by the PM?

Kamariah: I wouldn’t know.

Shafee: Does the PM respect the views of the EPU?

Kamariah: Correct.

3.36pm: Shafee: What is the organisational relationship between EPU and the PM’s Department?

Kamariah: (pauses) In a way, yes, but in the past we have decided in terms of development. But certain matters we go back to PM. But we are still answerable to PM’s department. But in research and development, we are independent.

Shafee: Are you answerable to the PM’s Dept?

Kamariah: In a way, yes.

3.37pm:  Shafee: The EPU isn’t bound by any opinion?

Kamariah: Somewhat correct.

Shafee ends his cross-examination and Kamariah is re-examined by Izzat.

3.40pm: Kamariah: We cannot give a grant for RM3 billion. Because the annual development budget is RM42 billion, if we give RM3 billion it’s 7% of our budget. If we gave the grant to a company that had not started, it would be negligent on our part.

Firdaus Latif

Izzat: You still provided the RM20 million. Any reason?

Kamariah: There was some merit to the company. To carry out research and studies on coal investments.

3.45pm: Sithambaram asks Kamariah after 2010, since the approval of SRC, was there any growth in the company?

Shafee objects to the question.

Sithambaram: This is just a follow-up question of whether there was an increase in coal supply after 2010.

Shafee: This was not in their application. It’s not fair to ask what transpired in the coal business because the questions were never raised. And she left in November 2011.

Sithambaram: A lot of emphasis has been made on coal. We need to know if there was an increase in coal investments.

Nazlan allows the line of questioning.

Kamariah says she was not aware of coal growth during that time.

3.47pm: Witness stands down and Harvinderjit asks for a five-minute break.

4.08pm: Court resumes with 29th witness, Amirul Imran Ahmad, taking the stand.

The 39-year-old vice-president of SME Bank Bhd has prepared a statement with help from the MACC. His testimony is based on his own information.

4.13pm: DPP Ishak Mohd Yusoff will question Amirul.

4.20pm: Amirul says he was involved in the two RM2 billion transactions that Retirement Fund Inc (KWAP) gave to SRC International in two separate tranches in 2011 and 2012.

4.29pm: On June 16, 2011, he sent an email to SRC director Nik Faisal Kamil’s assistant Nor Azlina, requesting for 1MDB’s accounts, current accounts and company’s profiles. He said he received a reply from Nor Azlina that they would give him the documents when they meet.

4.32pm: Amirul says he worked in KWAP as a deputy president for the fixed income department from 2011 to 2014.

He testifies that in June 2011, he received a letter from SRC International through the KWAP vice-president, who has since passed away.

The letter was an application for an RM3.95 billion loan from KWAP, he says.

He tells the court that the letter was signed by Nik Faisal and was addressed to Najib in his capacity as the then-prime minister and finance minister.

4.38pm: Amirul says the letter dated June 5, 2011, from Najib to the KWAP CEO at that time was that he agreed with the loan request from 1MDB for SRC.

“In my understanding, this was approval that the PM allowed KWAP to give the loan to SRC.”

FMT

He says because he has seen Najib’s signature many times, he can conclusively say that Najib had signed the letter.

4.41pm: Amirul says Nik Faisal emailed him on July 1, 2011, staying that 1MDB cannot disclose details of investments or cash flow of the company as it had not obtained approval from chairman of the board, which at that time was Najib.

He says he was then instructed by his CEO to prepare a proposal for an RM1 billion loan for working capital and general investments. This proposal would have to go through the KWAP investment panel.

4.46pm: Amirul says his superiors told him that the panel had decided to postpone the loan approval as they needed more information on SRC International.

He was then told to come up with a proposal for an RM2 billion loan for the panel’s consideration.

4.54pm: On July 19, 2011, he says KWAP’s investment panel had approved the RM2 billion loan for SRC made by 1MDB, which was made on a government guarantee. This means that the loan would be given to the government and the government would give the money to 1MDB.

4.57pm: On August 12, 2011, a request was made by SRC International to KWAP CEO Azian Mohd Noh that the money be issued straight to SRC International, as it already had government backing through 1MDB.

5.06pm: On August 22, 2011, KWAP also received a letter from MoF on the government guarantee for the RM2 billion for 10 years, says Amirul. The loan was approved on August 26, 2011.

5.19pm: The witness has stepped down from the stand. Shafee has asked the judge to replace the eight remaining Friday dates of the trial.

5.21pm: Judge agrees to continue the trial on Monday. Court is adjourned.


Earlier reports:

May 2, RM1M Golden Handshake in Final Month as PM for Najib

Apr 30, Najib’s SRC Trial: Day 11

Apr 29, Najib’s SRC Trial: Day 10

Apr 29, Court Throws Out Najib’s Application to Strike Out 7 SRC Charges, Trial to Go On

Apr 25, Najib’s SRC Trial: Day Nine

Apr 24, Najib’s SRC Trial: Day Eight

Apr 24, Najib’s SRC Trial: Day Seven

Apr 22, Najib’s SRC Trial: Day Six

Apr 18, Najib’s SRC Trial: Day Five

Apr 17, Najib’s SRC Trial: Day Four

Apr 16, Najib’s SRC Trial: Day Three

Apr 15, Najib’s SRC Trial: Day Two

Apr 3, Najib Trial: Day One