KUALA LUMPUR, Aug 28 — Bank Negara Malaysia (BNM) had wanted 1Malaysia Development Berhad (1MDB) to pay a fine of RM23 million, but the attorney general (AG) had pushed this down to the amount of RM15 million which 1MDB paid in 2016, former BNM governor Tan Sri Zeti Akhtar Aziz told the High Court today.
Zeti was testifying as the 46th prosecution witness in former prime minister Datuk Seri Najib Razak’s trial over RM2.28 billion of 1MDB funds.
Asked by Najib’s lead Tan Sri Muhammad Shafee Abdullah, Zeti said she did not know if Najib as the then finance minister had tried to stop BNM from punishing 1MDB with the fine over the company’s false declaration and sending of US$1.83 billion out of the country.
Zeti said the US$1.85 billion was sent out by 1MDB during the years 2009 to 2011 and that BNM had imposed the fine in 2015, adding that 1MDB’s board of directors and the Finance Ministry as 1MDB’s shareholder would have to be informed that the company has to pay the fine.
“And the penalty was finally paid, which means 1MDB admitted that they were wrong with respect to submission of information regarding the remittances,” she said, confirming that she does not have knowledge whether the 1MDB board of directors was actually informed about the fine.
While Shafee suggested that Zeti would not know if the Finance Ministry as the shareholder was actually informed about the fine on 1MDB, Zeti replied that the “Ministry of Finance was aware that this fine was going to be paid.”
Zeti said this was because she had as BNM’s then governor discussed the matter with the minister of finance II “just before the penalty was paid”. At the time that 1MDB paid the fine on May 25, 2016, Datuk Seri Ahmad Husni Hanadzlah was the finance minister II.
Zeti agreed with Shafee that she would not be aware if Najib as the finance minister had been informed about the fine on 1MDB.
Shafee: Now on the assumption, which my client doesn’t agree, but on the assumption, the minister of finance knew that some misbehaviour took place that resulted in this RM15 fine by Bank Negara on 1MDB, did you get any feedback, or was there any attempt by the minister of finance to ask you to waive this?
Zeti: No.
Shafee: No, isn’t it? So if the minister of finance was aware from the beginning, he did not take any steps to stop Bank Negara from punishing 1MDB with that fine?
Zeti: I have no knowledge.
Asked by Shafee if she does not know whether Najib stopped or did not stop the fine, Zeti replied: “Yes, I have no knowledge because in order to fine or impose a penalty to 1MDB, we needed the consent or permission of the attorney-general, and the attorney-general reduced the fine that was recommended by the central bank.”
Zeti said BNM recommended an amount “in the region of RM23 million”, and that the attorney-general had reduced the amount to RM15 million.
Asked by Shafee who said the attorney-general acts independently and who suggested that reduction of the fine to RM15 million is not an indicator that then prime minister and finance minister Najib has “knowledge” of it, Zeti replied: “I have no knowledge.”
Zeti did not say who was the attorney-general then.
Tan Sri Abdul Gani Patail’s services as attorney-general was terminated on July 27, 2015, and he was immediately replaced by Tan Sri Mohamed Apandi Ali who served until June 2018.
Following a government taskforce’s investigations on 1MDB and a raid on Ambank on July 6, 2015, BNM on August 14, 2015 revoked its previous three permissions to 1MDB to send US$1.83 billion out of Malaysia and also issued directions to 1MDB to bring back to Malaysia all the funds that were “illegally and falsely remitted abroad”.
This was because 1MDB had obtained the permissions from BNM to send money out for those “investments” abroad by giving inaccurate information or without giving complete disclosure of material information to BNM.
Zeti had previously said 1MDB paid RM15 million as a compound on May 25, 2016, stating that the penalty was imposed on 1MDB as a result of the company’s inability to bring back the US$1.83 billion and to provide evidence on the funds’ status.
Najib’s 1MDB trial before judge Datuk Collin Lawrence Sequerah will resume tomorrow.
