KUALA LUMPUR, July 27 — The Attorney-General’s Chambers (AGC) under Tan Sri Mohamed Apandi Ali in 2015 had decided against pressing charges over 1Malaysia Development Berhad (1MDB) despite Bank Negara Malaysia’s recommendations, former governor Tan Sri Zeti Akhtar Aziz told the High Court today.
Testifying as the 46th prosecution witness in Datuk Seri Najib Razak’s trial over RM2.28 billion of 1MDB, Zeti said a multi-agency task force on 1MDB was terminated on July 27, 2015 when its head, Tan Sri Abdul Gani Patail, was removed as the AG
After Apandi took over as attorney general, Zeti said there were “no longer” any task force meetings that were called by Apandi.
Zeti said the chief of the Malaysian Anti-Corruption Commission (MACC) at the time, Tan Sri Abu Kassim Mohamed, had on August 5, 2015 said he had been advised by Apandi that the 1MDB task force was no longer needed, and each investigating agency could carry out investigations based on their own laws.
“On August 13, 2015, BNM submitted an investigation paper to the Attorney General’s Chambers (AGC) with the recommendation to initiate criminal prosecution and to charge 1MDB including the senior officers of 1MDB,” she told Najib’s 1MDB trial today.
Zeti said BNM had found that 1MDB and its officers had breached the Exchange Control Act 1953 by giving “false information” to BNM when 1MDB was applying for permission to send money out of Malaysia.
Zeti said BNM had also provided all the relevant information on Najib’s bank accounts to the respective law enforcement agencies.
“Despite all the damning evidence gathered and recorded by BNM in the investigation paper on 1MDB which was submitted, the then AGC, for reasons unknown, had on September 11, 2015 decided that the investigation paper submitted by BNM was to be classified as ‘No Further Action’,” she said.
“In response, BNM wrote back to the AGC on October 1, 2015 to reconsider the decision and further stressed on the omission of material information by 1MDB in its application for the foreign exchange administration (FEA) permission.
“1MDB had not only failed to provide full and complete information in its applications for the FEA permission but had provided false information. The AGC however did not reply to BNM’s appeal,” she said.
Najib’s non-response ‘not normal’
Zeti today said she had sent two letters on behalf of BNM to Najib, who was also the finance minister then, on July 23, 2014 and January 16, 2015 to raise concerns over 1MDB’s high debt levels and its possible implications to the government’s finances, but said Najib never responded to either her or BNM. She said this lack of response from Najib was “not normal”.
Zeti said when she issued these two letters, BNM had no knowledge that 1MDB’s funds that were meant for investment were banked into accounts unrelated to investments, and did not know that money from 1MDB had entered Najib’s accounts.
“In fact, at that material time, BNM did not have knowledge that the funds in Datuk Seri Najib’s account was from 1MDB,” she said.
Zeti then listed the chronology of events surrounding BNM’s action to investigate 1MDB matters, following a confidential tip-off from a foreign authority on March 13, 2015.
Zeti said she had on March 19, 2015 met with then inspector-general of police Tan Sri Khalid Abu Bakar regarding the confidential disclosure; and that BNM had on March 20, 2015 carried out on-site examinations on AmBank and Deutsche Bank Malaysia Berhad regarding US$700 million of 1MDB funds which had ended up with Low Taek Jho’s Good Star Limited; followed by her March 23, 2015 disclosure of the US$700 million to then auditor-general Tan Sri Ambrin Buang.
Zeti said she had on April 21, 2015 shared the information with then MACC chief Abu Kassim, and that BNM had on May 12, 2015 started investigations against 1MDB, while then A-G Abdul Gani had on June 9, 2015 called the first taskforce meeting attended by Abu Kassim and Zeti to discuss MACC’s and BNM’s probes on 1MDB and that the police was later included in the same month in the task force meetings.
The task force was to coordinate investigations on 1MDB by the police, MACC and BNM, the latter two carrying out a joint raid at AmBank on July 6, 2015.
BNM on August 14, 2015 revoked its previous three permissions to 1MDB to send money out of Malaysia and also issued directions to 1MDB to bring back to Malaysia all the funds that were “illegally and falsely remitted abroad”, with Zeti adding that 1MDB paid RM15 million as a compound on May 25, 2016 as it was unable to bring back those money and failed to provide evidence on the funds’ status.
While Najib reportedly claimed in July 2018 that Zeti knew of the RM2.6 billion in his AmBank accounts, Zeti today stressed that she had no knowledge of this amount that was transferred into his account at that time, due to Malaysia’s laws that protects the privacy of all bank account holders and which meant that not even BNM could access any account unless suspicious activities were detected and reported to BNM.
Zeti said she had responded to Najib’s remarks in July 2018 then by saying that Najib had on July 3, 2015 asked her at the Prime Minister’s Office to issue a statement saying he had done nothing wrong in his account, but said she had rejected Najib’s request as she did not have knowledge of the transactions in his account and that he had accepted her decision.
“As stated in my press statement, the claim made by Datuk Seri Mohd Najib Tun Abdul Razak is false. Moreover, at the material time, I had no knowledge that the sum of RM2.6 billion had been remitted into his account and that the funds were monies that belonged to 1MDB,” she said today of her response in 2018 to Najib’s remarks then.
Zeti today said AmBank failed to report to BNM on over 500 suspicious or irregular transactions related to Najib’s account, adding that AmBank later acknowledged these failures to disclose as well as their giving of false information on the money that went into his account and their failure to comply with regulations.
“AmBank paid the highest penalty ever in our history amounting to RM59 million,” she said, adding that the bank had to set aside at least RM100 million for remedial action to strengthen their internal systems for compliance with anti-money laundering measures.
The lawyers representing Bank Negara Malaysia in holding a watching brief this afternoon in the 1MDB trial are G. Rajasingam, Nik Azila Shuhada Nik Abdullah, Justin Tong Wei Hang and Ong Tze Xian.
Lawyer Datuk Joshua Kevin Sathiaseelan held a watching brief for Zeti.
Najib’s 1MDB trial before judge Datuk Collin Lawrence Sequerah resumes on August 14.
