Pensioners’ fund only wanted to approve RM1 bil to SRC but raised it due to pressure, court hears

KWAP’s vice-president Azlida Mazni Arshad

KUALA LUMPUR: Pensioners’ fund KWAP initially wanted to approve a RM1 billion loan to SRC International Sdn Bhd as it was only a RM2 company, Najib Razak’s corruption and abuse of power trial heard today.

However, it ended up paying RM4 billion in total.

KWAP’s vice-president (Legal and Secretarial Department) said one of the reasons why its investment panel wanted to offer RM1 billion when an application was made for RM3.95 billion was that it was a RM2 company.

“However RM2 billion was approved as the panel chairman Wan Abdul Aziz Wan Abdullah told the meeting that the prime minister wanted SRC’s application expedited,” she said when examined by deputy public prosecutor Ishak Mohd Yusoff.

Najib was the prime minister and finance minister during that time.

She said SRC director Nik Faisal Ariff Kamil had submitted a two-page proposal to Najib on June 3, 2011, for the fund to get the RM3.95 billion loan.

Companies Commission assistant director Muhamad Akmaludin Abdullah, a prosecution witness, had said on April 3 that as of Jan 17, 2011, Nik Faisal and Vincent Koh Beng Huat  held shares worth RM1 each in SRC. Beng Huat was also SRC investment director.

Azlida, who was present at the investment panel’s unscheduled meeting on July 19, 2011, said the RM2 billion was approved to SRC as working capital and general investment.

She said KWAP’s Fixed Income Department had also submitted a paper to tighten the terms and conditions for the loan, which included asking the government to provide a guarantee.

“The panel members were also sensitive to SRC’s investment overseas and the risk to the country and the industry,” she said.

Najib faces six charges of money laundering and criminal breach of trust in the transfer of RM42 million to his account from SRC International, a former unit of 1MDB.

He is also accused of abusing his power as prime minister by giving government guarantees on SRC International’s RM4 billion loan from Retirement Fund Inc.

The Pekan MP was charged with committing the offences at AmIslamic Bank Bhd in Jalan Raja Chulan and the Prime Minister’s Office in Putrajaya between Aug 17, 2011, and Feb 10, 2015.

Earlier, KWAP’s former director of Accounts and Management Services Department (AMSD) M Ambalagam said he approved a payment voucher from KWAP’s Investment Settlement Department (ISD) to SRC amounting to RM2 billion in 2011.

“As director of AMSB, I am given a limit of authority by the KWAP chief executive officer to approve payment. I am also given authority to approve payment on behalf of ISD,” he said when examined by deputy public prosecutor Mohd Ahsrof Adrin Kamaril.

He said on Aug 26, 2011, KWAP received a notice from AmIslamic Bank (account no 21120220009736) to release the payment.

“I prepared the voucher as the vice-president of ISD Amirah Muhamad Nor was on leave,” he said.

He said the amount was paid out on Aug 29, 2011, after it was checked and verified by ISD staff.

The next witness, Amirah said on March 28, 2012, they paid out another RM2 billion to SRC. “This time we made two payments of RM1 billion each to SRC account number (21120220110650 at AmIslamic Bank,” said Amirah, who has since retired.

Hearing before judge Mohd Nazlan Mohd Ghazali was adjourned to May 14.