KUALA LUMPUR, Nov 11 — Former prime minister Datuk Seri Najib Razak must enter his defence and answer to charges over RM42 million misappropriated from 1Malaysia Development Berhad’s (1MDB) former subsidiary SRC International Sdn Bhd, the High Court ruled today.
High Court judge Mohd Nazlan Mohd Ghazali said the prosecution successfully proved prima facie against Najib, who is also Pekan MP, on all of his seven charges.
Explaining further, Mohd Nazlan said a maximum evaluation of all the evidence before the end of the prosecution stage was conducted that involved an assessment of the credibility of the prosecution witnesses and the drawing of inferences admitted by the prosecution evidence as tested in cross-examination.
“In my judgment, the prosecution has successfully adduced credible evidence proving each and every essential ingredient of the offences of abuse of position for gratification, criminal breach of trust (CBT) and money laundering as framed in the charges, in relation to any of which if unrebutted or unexplained, would warrant a conviction.
“A prima facie case has therefore been made out against the accused in respect of each of the single charge of use of position for gratification, the three CBT charges and the three money laundering charges within the meaning of Section 180 of the Criminal Procedure Code.
“As such I now call upon the accused to enter his defence in respect of all the seven charges,” he said while delivering his decision.
Najib, who was seated in the accused dock with a black pinstripe suit and a bright orange tie, appeared calm when the decision was read.
With a prima facie established against him, Najib has three options to make his defence — by sworn evidence from the witness stand where he will be subjected to cross-examination; by unsworn statement from the accused dock, or remaining silent.
Out of the seven charges levelled against Najib, the Pekan MP is accused of committing three counts of criminal breach of trust over a total RM42 million of SRC International funds while entrusted with its control as the prime minister and finance minister then, and a separate charge under an anti-corruption law of abusing the same positions for self-gratification of the same RM42 million sum.
The remaining three of the seven charges are for allegedly money-laundering the same total sum of RM42 million.
In delivering his judgement, Mohd Nazlan ruled that Najib played a role in the establishment of SRC International and its RM4 billion loan from the Retirement Fund Incorporated (KWAP) in 2011.
“Because of the accused being a prime minister and the finance minister, he was able to cause the establishment of SRC International that was made possible by his overarching authority.
“And as the PM and Minister of Finance Incorporated (MoF Inc) the accused also caused the introduction of a new article 117 to appoint himself as adviser emeritus of the company, to whom advice on strategic matters concerning SRC must be referred,” he said.
He said the crucial ability of Najib as the shareholder to have convinced — via his position as MoF Inc — SRC International’s directors to adhere to important decisions such as the deposits of the bulk of the company funds overseas could not be emphasised enough.
He said that the evidence of involvement of or on the series of actions taken by the accused in respect of SRC International demonstrated that the accused held an interest beyond that of public office.
One of these instances included Najib’s failure to disclose or excuse himself from the deliberations and approvals on the Cabinet memorandum on two government guarantees for the loans extended by KWAP to SRC International at two Cabinet meetings he chaired.
“The argument that the accused had not given instructions but merely made requests and had no role to play in securing the loans from KWAP cannot withstand scrutiny.
“Even if these were couched as mere requests it is manifest that they were made by the accused because they were meant to be obeyed,” he added, pointing out that everyone else in the picture was subordinate to the accused.
Mohd Nazlan said the RM4 billion loan would not have been approved by KWAP’s Investment Panel if not for the government guarantees.
“The accused knew or ought to have known of the conflict between his public duty as PM and finance minister in SRC International on the one hand and his own private albeit secret interest in SRC which applied for the government guarantees,” he said.
On the intention to obtain gratification, Mohd Nazlan said this could be easily inferred from the circumstances as the accused failed to avoid a conflict of interest position during Cabinet meetings when it already had been shown that Najib had an interest in SRC International — the subject matter of the decision to grant government guarantees.
“The guarantees made the loans (from KWAP) to SRC possible,” he said.
Mohd Nazlan said given Najib’s control over SRC International, the latter could cause the transfer of the company’s funds as happened in respect of the three fund transfers totalling RM42 million through intermediary companies before being credited into the accused’s personal AmBank accounts that were eventually utilised and expended to Najib’s own advantage.
“This gratification to the accused is pure and simple,” he said.
As for the three CBT and money laundering charges, Mohd Nazlan said evidence nonetheless showed the misappropriation occurred at the point when the funds of RM42 million or any larger part thereof was transferred into the bank accounts of Gandingan Mentari Sdn Bhd — even before the accused received the said funds in the accounts specified in the charges.
“The property under the control and entrustment of the accused was dishonestly misappropriated with the wrongful loss occasioned to SRC.
“Accordingly when the RM42 million finally flowed into the accused’s accounts the said funds could be construed as proceeds of unlawful activities,” he added.
Therefore, Mohd Nazlan said Najib knew of the RM42 million was proceeds of unlawful activities as the accused failed without reasonable excuse to take reasonable steps to ascertain whether or not the RM42 million was the proceeds of unlawful activities, as noted in the sheer volume and frequencies of transactions in Najib’s three bank accounts.
Najib’s SRC International trial began on April 3 this year with the prosecution calling 57 witnesses to the stand.
Earlier today, the High Court was filled to the brim with media personnel and Najib’s supporters who arrived as early as 6.30am for the hearing scheduled at 10am.
Some of the notable supporters of Najib present in court included Umno vice-president Datuk Seri Ismail Sabri Yaakob, MIC deputy president Datuk Seri M. Saravanan. Also present was Najib’s daughter Nooryana Najwa.
The High Court had previously on August 27 fixed December 3 to 4, December 9 to 19 excluding Fridays for trial at the defence stage if Najib’s defence is called.