1MDB told bank to withhold info from auditors, says ex-banker

 

Kevin Swampillai testified that the BSI Bank withheld investment information from auditors KPMG at the direction of 1MDB. (AP pic)

KUALA LUMPUR: An ex-banker told Najib Razak’s criminal trial that his bank deliberately withheld information about the “true nature” of investments made by 1MDB at the state-owned company’s request.

Kevin Swampillai, a former employee of BSI Bank, said he had attended a December 2012 meeting with several 1MDB officers and its auditors from KPMG in connection with 1MDB’s US$2.3 billion investment in Brazen Sky Ltd.

The meeting was intended to give KPMG an understanding of an investment into a fiduciary fund known as the “Bridge Absolute Return Fund”, he said.

However, Swampillai said former 1MDB deputy chief financial officer Terence Geh Choh Heng told him not to disclose to KPMG the “true nature of the actual underlying investments of the Bridge Fund”.

“Consequently, we didn’t give such information to KPMG,” he said.

In previous proceedings, the court was told that KPMG had questioned the authenticity of 1MDB’s injection of US$2.3 billion into Brazen Sky.

The auditors later refused to sign off on 1MDB’s 2013 financial statements. KPMG was subsequently replaced as auditors by Deloitte.

Sidelined

Swampillai also testified that he was sidelined from handling 1MDB and SRC International’s accounts after being suspected by fugitive businessman Low Taek Jho (Jho Low) of leaking information to the media.

Low had become worried after news reports about 1MDB began to surface in 2016.

The witness said those suspicions eventually led to his then subordinate Yeo Jiawei taking on a more prominent role in 1MDB and SRC International matters.

Swampillai also told the High Court that 1MDB employees saw Low as their “boss”.

He said he observed this at a dinner party attended by Low, 1MDB’s then general counsel Loo Ai Swan, its then chief financial officer Azmi Tahir and Geh.

Other attendees included Swampillai’s former colleagues, Yvonne Seah and Yak Yew Chee, and former Goldman Sachs investment banker Tim Leissner.

“He (Low) positioned himself as the ‘adviser’ of 1MDB and SRC, and the go-to person to discuss anything about the companies and transactions,” Swampillai added.

However, the witness said Low was not the “apex decision-maker” in matters related to the companies.

“I assumed there was someone above Jho Low, but I can’t recall any evidence that states so,” he said.

The hearing continues before Justice Collin Lawrence Sequerah on Thursday.

Najib faces 25 charges of abuse of power and money laundering over alleged 1MDB funds amounting to RM2.28 billion deposited into his AmBank accounts between February 2011 and December 2014. - FMT