Ali Hamsa called original 1MDB audit report content 'dangerous material evidence'

AUDIT TAMPERING TRIAL | Former chief secretary to the government Ali Hamsa had described part of the original audit report on 1MDB by the National Audit Department (NAD) as "very dangerous material evidence".

This was specifically on the NAD highlighting the fact that 1MDB had two versions of its financial statement in its report.

The comment was captured on an audio recording and was today again played during the trial of former prime minister Najib Abdul Razak and former 1MDB chief executive officer Arul Kanda Kandasamy on the alleged tampering of 1MDB's audit report at the Kuala Lumpur High Court.

The recording was played for retired NAD officer Saadatul Nafisah Bashir Ahmad who was present during the Feb 24, 2016 meeting when the recording was made.

Deputy public prosecutor Akram Gharib, who was examining Saadatul Nafisah, had asked her to confirm what Ali Hamsa meant by "very dangerous material evidence".

Akram: Tan Sri Ali Hamsa saying: 'A very dangerous material evidence'. What is the reference?

Saadatul Nafisah: We have evidence of the two accounts (statements).

Akram: And that is the 'dangerous material'?

Saadatul Nafisah: Yes. And we can prove there are two accounts.

The audio recording was secretly recorded by Saadatul's colleague Nor Salwani Muhammad, who also kept a copy of the original 1MDB audit report which was ordered to be destroyed, both which are now key pieces of evidence in the case.

At Ali and Arul Kanda's urging during the meeting, the NAD was eventually forced to omit parts of their report, including the part about the conflicting financial statement.

In November last year, former NAD director-general Ambrin Buang had also taken the stand where he testified about 1MDB's financial statement which the government did not want to become public.

The differing financial statement was on whether 1MDB still had any money left in its segregated portfolio company (SPC) investment, often referred to as "fund units".

"One version of the financial statement sent to the Companies Commission of Malaysia (SSM) stated that 1MDB had utilised the funds redeemed from its SPC investment to repay 1MDB debts and for working capital.

"Another version of the financial statement sent to the Finance Ministry, Deutsche Bank and Ambank stated that the funds redeemed from the SPC investments were still in 1MDB's possession," Ambrin had said.

He had conveyed these to Najib before being summoned to meet Ali.

In Saadatul Nafisah's witness statement today, she said after implementing the changes requested by Ali and Arul, the final draft was delivered to Ali at his office on Feb 29, 2016.

"He instructed me not to print the final audit report until instruction and consent were received from Najib.

"To my memory, Ali said 'don't print the report until his green light'. He said there would be a political impact on the country.

"I then informed Ambrin of this, and he took note," she said.

Saadatul Nafisah said Arul had requested for more changes during a meeting on March 1, 2016, and the final report was finally sent for printing the next day.

The original version which was sent for printing on Feb 20, 2016, was ordered to be destroyed. - Mkini