Subscribe to our Telegram channel for the latest updates on news you need to know.
KUALA LUMPUR, Feb 9 — Low Taek Jho, who is now a fugitive wanted in Malaysia, had the authority to decide who would become the CEO of the government-owned company 1Malaysia Development Berhad (1MDB), the High Court heard today.
Mohd Hazem Abd Rahman, the former CEO of 1MDB, said this while testifying as the 10th prosecution witness against Datuk Seri Najib Razak in the latter’s trial over RM2 billion of 1MDB funds.
Hazem joined 1MDB as chief operating officer in August 2012 and was its CEO from March 2013, but had wanted to resign just six months into his job.
Under cross-examination by Najib’s lawyer Wan Aizuddin Wan Mohammed, Hazem confirmed that he had in a September 19, 2013 email told fellow colleague Azmi Tahir — who was 1MDB chief financial officer — of his intentions to quit the company.
In the email, Hazem had said he could recommend Azmi to Low for the 1MDB CEO position, if Azmi was interested in it.
“If you are interested for the job, I will recommend you for it to him but let me know if you decide otherwise. My advice though as a friend is a no,” Hazem had told Azmi in the email.
Hazem confirmed that he did not recommend Azmi to succeed him as 1MDB CEO.
Aizuddin: So you are saying Jho Low is also in a position to decide who will be the CEO and members of the management?
Aizuddin: So he has the authority?
Hazem had earlier today also described how Low had “planted” individuals within 1MDB’s senior management such as now fugitives Jasmine Loo and Terence Geh, as well as how Low was referred to as “PMO” or Prime Minister’s Office in 1MDB board meetings when his instructions were mentioned.
Hazem had in the past described Low as being the trusted right-hand man and proxy for Najib as the latter’s adviser for 1MDB affairs.
Today, Hazem agreed with Wan Aizuddin that he was accustomed as 1MDB CEO to following instructions given by Low on how to run 1MDB’s business and operations.
Having yesterday asserted that he had to follow Low’s instructions on 1MDB even if he did not agree with such instructions personally, Hazem said that he had wanted to leave the company as early as September 2013.
Asked why he had continued to serve as 1MDB CEO until January 2015 despite wanting to resign, Hazem said that this was due to Najib’s late principal private secretary Datuk Azlin Alias placating him and asking him to remain with the company.
Hazem said he believed that Low was aware of his frustrations and that Low had asked Azlin to intervene.
Aizuddin: Did you highlight your intention of leaving to Jho Low?
Hazem: I told him many times, yes.
Aizuddin: What was his reaction?
Hazem: To just you know, calm me down and say just wait.
Wan Aizuddin questioned Hazem over his intention to resign from 1MDB while also at the same time complying with instructions from Low to avoid jeopardising his career, but Hazem insisted that his career would have been jeopardised if he had resigned and that there was a real possibility of being sacked from 1MDB if he did not follow some of the instructions. At the same time, Hazem said he had not hesitated to resign.
Previously, in his witness statement, Hazem said he was always advised by Azlin to wait instead of resigning from 1MDB, but said he had at the end of October 2014 seriously stated to Low and Azlin his intention to step down as CEO and had requested that a candidate be identified to replace him as none of his officers wanted the job.
Finally, when Arul Kanda Kandasamy reported to work as 1MDB president on January 5, 2015, which was a position that the CEO had to report to, Hazem said he decided that this was the right time for him to quit as CEO as the portfolio of the position was the same as company president.
In the September 2013 email to Azmi, Hazem had said he felt that 1MDB has fallen into the “biggest trap in Malaysia’s corporate history”, due to 1MDB affairs being done in haste with most of the calculations by Low for proposed projects for 1MDB in a September 18, 2013 email to Hazem being akin to “back of envelope calculations”.
Hazem explained today that he felt that 1MDB was a big company left with extremely huge amounts of debt with government guarantees tied to the debts, while Low’s email appeared to be only based on several hours of planning with mere back-of-the envelope calculations without any real studies or analysis, and that his reference of the biggest trap in Malaysia’s corporate history was due to 1MDB being debt-ridden and cash flow problems with no real plans to rid itself of the debts or for new projects.
Wan Aizuddin then asked if the remark on 1MDB falling into the biggest trap was “nothing sinister” such as the company being cheated and if it was just that the company was not running with profits, Hazem agreed.
Najib’s 1MDB trial before High Court judge Collin Lawrence Sequerah resumes tomorrow morning.