In SRC’s US$1.1b suit, Najib testifies in court for the second time five years later

KUALA LUMPUR, Sept 25 — Five years after he first took the stand in his RM42 million SRC International criminal trial, Datuk Seri Najib Razak today found himself in the same position testifying in an ongoing civil suit against him by the same entity instead.

Najib is testifying as the first defendant in SRC International’s US$1.18 billion (RM5.58 billion) ongoing civil suit against him at the Commercial High Court.

At the onset of hearing, High Court judge Datuk Ahmad Fairuz Zainol Abidin had asked Najib if he was comfortable with the seating arrangement in the witness stand after taking his oath in English.

Adjusting his seat and replying in the affirmative, Najib said he might “need to stretch his legs” from time to time.

Najib then started reading out his witness statement, outlining the significance of the need for security of energy as a national key area of development during his premiership which led to SRC International’s eventual formation.

Najib, who was also the finance minister at the time, was SRC International’s sole and exclusive shareholder by way of Minister of Finance (Incorporated).

“I thought that the idea behind SRC was timely. In order to achieve the goals of the 10th Malaysian Plan, we had to factor in the increased requirements for natural energy resources such as coal and oil and gas to support the development initiatives thereunder,” he said.

On SRC’s corporate governance, Najib said it was untrue that every decision of the company’s board required his approval and that his instructions were relayed through his alleged proxy, Nik Faisal Ariff Kamil.

He said it was not how a Minister of Finance (Incorporated) company is run and that SRC International was no exception.

Najib explained that in his limited meetings with Nik Faisal, the latter had represented that the board had decided on the investments after the necessary deliberations and due diligence were undertaken.

“Looking at things now it appears that Nik Faisal may have been playing both sides.

“To me he would hold out that matters had been decided by the board and to the board he held out that I had directed on matters.

“What however baffles me is why the other directors of SRC including Tan Sri Ismee did not bother to verify things with me directly and merely accepted the word of Nik Faisal.

“This is especially in relation to funds of the company,” he said.

On claims over Najib’s sole authority to “hire and fire” SRC International’s director resulting in his overarching authority over the board, Najib said their appointment and removal had to be preceded with company resolutions prior to the approval of the PM being sought.

“With respect, it is quite preposterous. The power to hire or remove any director is usually in the hands of the shareholders of a company.

“I also note that despite all the hullabaloo being made on this power there isn’t any specific instance pointed out where I as the PM had ‘fired’ anyone in SRC,” he said.

Imprisoned since August 23, 2022, Najib is serving his 12-year jail sentence and RM210 million fine for his conviction over the misappropriation of SRC International’s RM42 million funds, which has recently been reduced to six years of jail and RM50 million fine by the Pardons Board.

SRC, under its new management, sued Najib and its former directors Datuk Suboh Md Yassin, Datuk Mohammed Azhar Osman Khairuddin, Nik Faisal Ariff Kamil, Datuk Che Abdullah @ Rashidi Che Omar, Datuk Shahrol Azral Ibrahim Halmi, and Tan Sri Ismee Ismail in May 2021.

However, it later removed six names from the suit but retained Najib as the defendant.

Additionally, Najib has brought the former named SRC International directors as third-party respondents.

SRC as a plaintiff in the writ of summons had alleged that Najib had abused his power and obtained personal benefits from SRC International’s funds as well as misappropriated the funds. Najib was SRC’s Emeritus Adviser from May 1, 2012, until March 4, 2019.

SRC International, which is now wholly owned by the Ministry of Finance Incorporated (MoF Inc), is seeking general damages, exemplary, additional interest, costs and other appropriate relief provided by the court.

SRC International is currently seeking a declaration from the court that Naijib is liable to account for the company’s losses due to his breach of duties and trust.

The company is also seeking an order that Najib pay the US$1.18 billion in losses it suffered, and damages for breach of duties and trust; including an order that Najib compensate the sum of US$120 million which entered his bank account as well.