He said he believed then that converting the shares to murabaha notes was part of “something bigger for the country” as it involved a government-to-government strategy.
“It was the relationship between 1MDB and PetroSaudi International that played an important role in the strategic relationship between the two countries.
“At the time, I did not see it as suspicious,” he said when questioned by Najib’s lawyer Muhammad Shafee Abdullah.
He said the idea of converting the shares to murabaha notes in 2010 came from businessman Low Taek Jho and former 1MDB executive director Tang Keng Chee, also known as Casey.
Nik Faisal Ariff Kamil, the company’s former chief investment officer, was tasked with managing the transfer of shares to murabaha notes.
Shahrol said the 1MDB board of directors had signed a circular resolution for the company to discuss the plan.
However, Shafee said paying another US$1 billion for the Islamic notes which would require 1MDB to make available another US$1.5 billion was “the most ridiculous suggestion”.
“The reason I asked you about the murabaha notes was because this is either an idiotic decision, or a decision just to cheat 1MDB and make the company look like an idiot,” he said.
However, Shahrol said that was Shafee’s opinion.
Shafee then asked about the resolution signed by the 1MDB directors in March 2010. He said documentation of the share-sale letter, agreement and guarantee under the appendix section was missing, as was the circulation number.
But Shahrol said he had seen the appendix during investigations.
“On the circulation number, that is best answered by Goh Gaik Kim who was the company secretary at the time.
“She was the one claimed to be Jho Low’s aunt, and (Finance Minister) Lim Guan Eng had to issue a denial,” he added.
Najib is standing trial for 25 counts of money laundering and abuse of power charges over alleged 1MDB funds amounting to RM2.28 billion deposited in his AmBank accounts between February 2011 and December 2014.
The hearing continues tomorrow before High Court judge Collin Lawrence Sequerah.