KUALA LUMPUR, Aug 29 — Bank Negara Malaysia (BNM) had accepted Datuk Seri Najib Razak’s claim in his 2013 letter that the RM2.26 billion in his AmBank account were “donations” which he wanted to give back to the donor, as Najib was then the finance minister who was running Malaysia’s finances, the High Court heard today.
Former BNM governor Tan Sri Zeti Akhtar Aziz said this while testifying as the 46th prosecution witness in Najib’s trial, where RM2.28 billion of money misappropriated from 1MDB was alleged to have entered Najib’s personal bank accounts.
Today, Najib’s lead defence lawyer Tan Sri Muhammad Shafee Abdullah referred to a June 20, 2013 letter from Najib with his address stated as his personal residence at Jalan Langgak Duta Kuala Lumpur, and addressed to Zeti and received by BNM.
Shafee read aloud the June 2013 letter in court, where Najib wrote that he wished to inform Zeti of his intention to convert RM2.26 billion in his current account to US dollars to return the “entire amount which represents the unutilised sum of the contribution in terms of donations and personal gifts I have initially received”, and where he said he was seeking to have BNM’s written approval for the conversion to US dollars and to send the money out of Malaysia.
Shafee then noted that a BNM officer — identified to be then BNM assistant governor Norzila Abdul Aziz — had in a July 25, 2013 written note to Zeti in the letter said that no BNM approval was required under the Foreign Exchange Administration (FEA) rules as Najib’s intended transaction was to return a gift and donation.
Shafee then suggested that Norzila’s opinion implied that BNM knew earlier on that Najib had received a “donation” but Zeti said that BNM merely took what was stated in Najib’s letter which stated that he wanted to return the unused portions of “donations”.
“No, Bank Negara did not know earlier on, the first time we knew it was from this letter,” Zeti replied.
Shafee then questioned how BNM’s assistant governor could offer the opinion that no approval was required since it was a return of donations without checking or asking when Najib received these funds.
“How could Bank Negara take at face value that a staggering amount of RM2.26 billion is being returned without checking when did you receive it, call up AmBank and ask why you guys never reported it to us? This letter pins down Bank Negara in your dispute that you never knew,” Shafee claimed.
Zeti then maintained that BNM had not known that these billions worth of ringgit had entered Najib’s account as a purported “donation”, but said BNM took Najib’s word as he was the then finance minister for Malaysia.
“We did not know, because these sums of money were not reported, and the evidence is very clear that they were not reported and AmBank admitted to it, and AmBank paid the fine as they did not report it.
“And how would the central bank know? The central bank just knows he’s the minister of finance, he’s managing the finance of the country. He stated he received this and he’s returning it back. He was believed,” she said.
Shafee however said it was “unbelievable” that BNM took Najib’s words at face value and claimed it would be as “ridiculous as suggesting the cow jumping over the moon”, claiming that BNM knew the money came into Najib’s account through a donation.
Shafee also said it did not matter if Najib was the prime minister or finance minister and tried to cast doubt on BNM believing Najib more because of his position then.
But Zeti shot back: “Well, he was managing finances for the whole country.”
Shafee suggested that BNM allowed the money in Najib’s account to leave as it knew the money came in as a gift for Najib, but Zeti disagreed by saying “that is not correct”.
Shafee said BNM could not take Najib’s word for granted that he was returning donations, as he was a politically exposed person due to his roles as prime minister and finance minister.
But Zeti said BNM did not know then that Najib had received RM3.2 billion in his account, with Shafee then saying that he would be presenting further arguments on this matter to the 1MDB trial judge.
Zeti previously said that she was not informed by AmBank’s former managing director Cheah Tek Kuang that Najib had opened an AmBank account with the expectation of receiving a purported US$100 million donation from Saudi Arabia.
Najib’s lawyers have been arguing that he believed the RM2.28 billion which entered his bank accounts were donations, and have produced four letters from a purported Saudi prince which promised huge sums of money as gifts.
The four purported letters addressed to Najib are dated February 1, 2011 with a purported promise of a gift of US$100 million, followed by a November 1, 2011 letter promising a gift of US$375 million, a March 1, 2013 letter promising a gift of US$800 million and a June 1, 2014 letter promising £50 million.
But Zeti said she had not seen the first purported donation letter until mid-2015 (before a joint raid on AmBank in July 2015 by BNM and the Malaysian Anti-Corruption Commission’s (MACC)), and said BNM did not know of the three other purported donation letters until the July 2015 raid.
AmBank’s then managing director Cheah Tek Kuang had on March 22, 2011 wrote to then BNM deputy governor Tan Sri Nor Shamsiah Mohd Yunus and attached the first purported donation letter, but Zeti said she had no knowledge of these letters as they were not sent up to her but was sent down to the head of BNM’s Supervision Department.
Zeti said the first purported donation letter was just a letter of intent without details of any financial transactions and that AmBank would have been told to do its due diligence, saying that this was an operational matter that would not get escalated up to her.
Zeti said it was “appropriate” for the first donation letter to not be forwarded to her, as it contained no “material information”.
Shafee then reminded Zeti that she was under oath as a witness and asked if she was aware about perjury or lying in court and its punishment, with Zeti saying she was aware but maintaining that she had not seen the first purported donation letter back in 2011.
Zeti said AmBank was not required by law to forward each of the four purported Saudi donation letters to BNM to justify the money that entered Najib’s account, but said AmBank would only be required to report to BNM that the money had came in.
Zeti agreed that AmBank would have to ask its client Najib why the money was in his account if there was a red flag and would have to then provide all four donation letters to BNM, but said it would not be necessary for AmBank to submit those letters to BNM if AmBank had done its due diligence and found that there was nothing wrong.
Previously, Zeti had highlighted AmBank as having paid RM59 million in penalty and having to set aside a minimum RM100 million for remedial action, over its failures such as failing to submit suspicious transaction reports (STR) on Najib’s accounts, giving false information to BNM by reporting that money went into AmBank’s own bank account when the funds were actually sent to Najib’s AmBank accounts, and failing to even report multiple inflows of money from abroad into Najib’s bank account.
Zeti said AmBank’s omission of reporting or non-reporting of these transactions resulted in BNM not knowing about the huge sums of money which entered Najib’s accounts.
Zeti has yet to complete her testimony, but is expected to return at a later stage of the trial, as Shafee intends to first obtain an alleged statement recorded by the Malaysian Anti-Corruption Commission (MACC) from former AmBank managing director Ashok Ramamurthy.
Najib’s 1MDB trial resumes tomorrow, with an analyst from BNM expected to testify as the 47th prosecution witness to lay out the money trail in this case.
