Court says Najib’s bank account was opened in 2011, defense says money from RM5b bond of 1MDB’s predecessor could not have gone there | Malaysia

KUALA LUMPUR, March 21 – Former Prime Minister Datuk Seri Najib Razak reportedly could not receive money from a RM5 billion bond issued in 2009 by 1Malaysia Development Berhad (1MDB) predecessor, Terengganu Investment Authority (TIA), pleaded its defense in the High Court today. .

Najib’s lawyer, Tan Sri Muhammad Shafee Abdullah, claimed it was because Najib’s bank account at AmBank was only opened in 2011.

Shafee suggested this during cross-examination of former TIA and 1MDB director Tan Sri Ismee Ismail.

Ismee was testifying as the 13th prosecution witness in Najib’s trial for the embezzlement of over RM2 billion of 1MDB funds.

Shafee today focused on the events that took place before TIA was renamed 1MDB in September 2009, including a fundraising exercise in May 2009 where TIA incurred debt by issuing a $5 billion bond of RM via Islamic Medium Term Notes (IMTN).

Shafee referred Ismee to various transactions, including how TIA lost when two companies made alleged secret profits in reverse portions of TIA’s RM5 billion bondciting a trade publication The edgeArticle from June 24, 2019.

Shafi: Now, this is important because it has a serious bearing on Datuk Seri Najib’s defense, so thank you for being as candid as possible. If you remember, the more the better. So far, have you seen from the transactions that I have shown you, have you seen that money from this IMTN has ever gone into Datuk Seri Najib’s kitty or bank account, according to what did I just show you?

Isme: No.

Deputy Prosecutor Mohamad Mustaffa P. Kunyalam objected at this stage, saying The Edge report mentioned the payment of Najib and his son-in-law Riza Shahriz Abdul Aziz.

The edgequoted the US Department of Justice as saying that the money stolen from 1MDB was transiting through companies controlled by the fugitive Low Taek Jho and his associate Eric Tan Kim Loong, also reporting that these companies had, for example, given 1.2 million dollars to Riza to buy a rare Hollywood poster and US$1.278 million in Najib’s AmBank account in June 2014.

Shafee, however, argued that these reported payments were related to other bonds and other transactions and were unrelated to the RM5 billion bond issued by TIA through IMTN, insisting that the funds paid into Najib’s account were allegedly a “donation” from Saudi Arabia.

“Yes, when we deal with Aabar, that’s the next phase. It has nothing to do with it. IMTN, RM5 billion bond, nothing went to Datuk Seri Najib’s account, nothing. This is very important, we wanted to establish this, because the money started going to Datuk Seri Najib’s account only because of the donation arrangement.

“After the meeting, this money came in. Why did he come in is for someone else to answer. Because as far as my client was concerned, he had this impression…the donation money coming in, which will consist of seven transactions, the initial seven transactions came from the Saudi Ministry of Finance,” Shafee said.

“And Yang Arif, which is more obvious, Datuk Seri Najib’s AmBank account only opened on January 13, 2011, so it can’t have anything to do with IMTN,” Shafee said.

When asked again if it seemed like no one else seemed to benefit from the RM5 billion fundraising exercise apart from fugitive Low Taek Jho and an individual known as Cheah Teik Seng and that the money didn’t go to Najib, based on what Shafee showed, Ismee agreed.

The edge article Shafee had shown Ismee had referred to how AmBank in May 2009 sold RM3.8bn of TIA’s RM5bn bond to Country Group Securities Plc who bought them for Low and 700 million of the same bond to Aktis Capital Singapore Pte Ltd for its client known as Morningstar Equities Inc, the two companies having purchased the bonds at a discount of over 12.08% (at RM87.92 against the face value of RM100) and return the bonds by selling them (between RM100 and RM105) to make hundreds of millions of ringgits in profit. Shafee named Cheah Teik Seng as a director of Aktis Capital, while The Edge also reported that Morningstar Equities was linked to Vincent Cheah Chee Kong and Shaik Aqmal Shaik Allaudin.

Shafee also today focused on claims that Low diverted money linked to RM5bn TIA bonds in 2009 to the family of former Bank Negara Malaysia Governor Tan Sri Zeti Aziz.

While Shafee had focused on the events surrounding TIA’s RM5 billion bond, Najib’s 1MDB lawsuit is actually about events and transactions related to 1MDB. In this lawsuit, Najib was accused of having committed corruption offenses by allegedly abusing his office in the years 2011 to 2014, and of having committed money laundering offenses in 2013.

On the first day of the trial, the prosecution said it would show that US$20 million (RM60,629,839.43) of funds linked to 1MDB had been sent to Najib’s account in 2011, and that it would show also that a sum totaling RM90,899,927.28 of these funds went to Najib in 2012, and an alleged amount of US$681 million (RM2,081,476,926) went to him in 2013, and that a sum amounting to RM49,930,985.70 was also allegedly paid into his account in 2014.

Najib’s 1MDB trial before High Court Judge Datuk Collin Lawrence Sequerah resumes this afternoon.