Najib knew about US$700m diversion to Good Star: Witness

KUALA LUMPUR (Oct 30): The diversion of US$700 million to Good Star Ltd — a company linked to fugitive businessman Low Taek Jho — instead of the joint venture company set up between 1 Malaysia Development Bhd (1MDB) and PetroSaudi International Ltd (PSI), was apparently known to former prime minister Datuk Seri Najib Abdul Razak, said a former 1MDB chief executive.

Datuk Shahrol Azral Ibrahim Halmi who was the former CEO to the now-defunct sovereign wealth fund, admitted to the High Court yesterday that he had raised the matter of the US$700 million transfer to Good Star, in a private meeting with Najib back in October 2009.

The JV company, 1MDB PetroSaudi Ltd, was set up between 1MDB and PSI in 2009, in which 1MDB had agreed to inject US$1 billion cash, while PSI was to inject US$1.5 billion worth of oilfield-related assets.

During cross-examination earlier, lead defence counsel Tan Sri Muhammad Shafee Abdullah brought to Shahrol’s attention, the minutes of a private meeting held between the latter and Najib, who was then the chairman of the 1MDB’s board of advisors.

According to Shahrol, the meeting — which lasted between half and hour and one hour — was also attended by the then-chief secretary to the government Tan Sri Sidek Hassan, treasury secretary-general Tan Sri Wan Abdul Aziz Wan Abdullah and minister in charge of the Economic Planning Unit Tan Sri Nor Mohamed Yakcop.

Shafee had asked Shahrol whether the US$700 million diversion — which was not initially known by the board — was mentioned in their meeting, to which the witness answered yes.

The lawyer then asked as to why the US$700 million remittance to Good Star was not mentioned in the minutes.

Shahrol responded that he verbally mentioned it to Najib. 

"It is such a major item, how come it was not even briefed to the chairman of the board of adviser?" Shafee asked.

"I disagree with that statement, I briefed the chairman, I conveyed the concern of the board of directors to Jho, and trusted him that he would convey it to the Prime Minister," Shahrol said.

Shahrol testified that after a meeting with Najib, in his capacity as the 1MDB board of advisors chairperson on Oct 16, 2009, he went to see Jho Low, obtained the purported minutes of their meeting and went back to the 1MDB board of directors.

On hearing this, Shafee exclaimed that it is akin to asking a fox to take care of a chicken.

Shafee: Am I wrong that Jho Low was the fox taking care of the chicken?

Shahrol: I saw him (Jho Low) as a facilitator for Najib. Now, it seems that he (Jho Low) was in a way facilitating the misappropriation from 1MDB.

I think it is worth knowing that in 2010, Good Star (owned by Jho Low) sent money to Red Granite (a film company linked to Najib's stepson Riza Aziz).

Shafee: Why did you go to Red Granite? Concentrate on what you did or did not (answer to specific questions during cross-examination).

Shafee then pressed on for the reason Shahrol did not record his discussion with Najib on the US$700 million in the minutes.

Defending himself, Shahrol said: "If it were up to me, I would have recorded, but this paper was prepared by Jho.”

"Was Jho the CEO? Was he the shadow CEO?" Shafee countered.

"As the prosecution mentioned, he was the mirror image of the Prime Minister," Shahrol replied.

Nonetheless, Shafee said Shahrol could have still included the US$700 million transfer to Good Star in the minutes, which Shahrol conceded.

"You could have documented it, but you did not," Shafee says.

Out of the US$700 million transferred to Good Star, it was reported last month that US$10.17 million went to Red Granite.

The Edge is reporting the proceedings of the 1MDB-Tanore trial live.

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