Ex-CEO agrees Najib was 1MDB's 'emperor'

NAJIB TRIAL | Former 1MDB chief executive officer Shahrol Azral Ibrahim Halmi today agreed with the suggestion that Najib Abdul Razak was like an emperor in 1MDB when he was still prime minister and the chairperson of the company's board of advisers.

He said this when being cross-examined by lead defence counsel Muhammad Shafee Abdullah during Najib's 1MDB graft trial at the Kuala Lumpur High Court today.

Shafee was trying to establish the extent of Najib's powers in 1MDB and repeatedly suggested that it was only advisory in nature, but Shahrol kept insisting otherwise, claiming the 1MDB board would fulfil Najib's will.

Shafee then said that based on Shahrol's statement, he had made "the prime minister as emperor of 1MDB - no checks and balance".

Shahrol replied: "I would have to say yes."

The former 1MDB CEO then cited Article 117 of 1MDB's Memorandum and Articles of Association (M&A) which said any decisions relating to 1MDB's financial commitment, investments and restructuring would require the prime minister's approval.

Shafee suggested that this was only like a "veto power", where the prime minister could block any decision by the 1MDB board only if necessary.

However, Shahrol said this was interpreted as having to work with the prime minister closely according to his wishes.

Shafee: Your interpretation is totally flawed, you did not properly advise the prime minister on his power under 1MDB.

Shahrol: But the power is him.

Shafee: You did not properly advise him on his power as the chairperson (of the board of advisers).

Shahrol: I never did.

Earlier, Shahrol testified that Najib wore "three hats", namely that of the prime minister, finance minister and chairperson of the board of advisers.

Shafee (drawing) suggested that under Article 117 of the M&A, only meant that the board of directors could seek advice from the board of advisers, chaired by Najib if they are "stuck".

He added that the board of advisers could issue advice in writing or be invited to attend the board of directors meeting, but any advice given is non-binding.

However, Shahrol said while the rules may be as such, the reality was different.

"I can only testify to what had happened and what had happened at that time, for myself, we consider these minutes taken and signed by Najib as instructions by the prime minister, and we as directors are duty-bound to execute his wishes.

"Whether it was in compliance with the rules - it is fair for you to raise this. But what happened from 2009 until 2013, when I left as the CEO, is that I continued to see Najib as the ultimate power in 1MDB," he said.

Shafee then told Shahrol that he had gotten things "upside-down".

"That's why 1MDB is down the drain," Shafee said, to which Shahrol replied: "I can only tell you what happened".

Najib is standing trial for 25 charges of money laundering and abuse of power over the alleged misappropriation of RM2.28 billion from 1MDB.

The trial is being presided by Kuala Lumpur High Court judge Collin Lawrence Sequerah. - Mkini