What led to the DNAA for Riza Aziz

The recent resolution to Riza Aziz’s case is not a controversial one. I fear that controversy was created by interested parties to get at Najib Razak by prejudicing his ongoing cases through the unkind attacks on Riza’s matter.

It has become imperative for me to write this piece to clear the air, to extract the truth from the womb of society that otherwise may be so fortified against truth itself.

Riza, Najib’s stepson, was charged on July 4, 2019 with five offences of money laundering, all of which purportedly had taken place in Los Angeles (two charges) and Singapore (three charges). The total amount of money involved (not stolen) in these five charges is about US$248 million.

It is important to stress that Riza was never charged with stealing or cheating anybody or the like.

In essence, these money laundering charges against him is that he received these monies which purportedly are proceeds of the unlawful activities emanating from 1 MDB.

Riza, in his statements to the Malaysian Anti-Corruption Commission (MACC), clarified that he received these monies as documented loans from Alsen Chance and Aabar, two entities connected to Petro Saudi of Saudi Arabia and IPIC of Abu Dhabi respectively.

It is important to stress this because the prosecution, if the trial had proceeded, would have to prove in Riza’s case that:

(a) Riza received these monies that emanated from 1MDB;
(b) these monies are in fact proceeds of identified crimes (the unlawful activities);

(c) the identified crimes were actually committed, not necessarily by Riza but maybe by third parties;

(d) Riza has actual knowledge that these funds are from the proceeds of these crimes.

Members of the public have been misled into thinking that the only thing that the prosecution needs to prove to convict Riza on money laundering is to show that he received these funds (only one element). That is wrong. You have to prove at least those four separate elements.

The point I want to stress is that had the prosecution embarked on a full trial against Riza, it would not be a walk in the park for them. It is an uphill battle. The scenario of the ongoing 1MDB case has to be proven first and then the chain of transmissions of these funds, from Malaysia to Saudi Arabia, Abu Dhabi, Lugano, Virgin Islands, Los Angeles and Singapore, among others, needs to be conclusively demonstrated.

Just imagine the kind of proof the prosecution would have to undertake; the foreign documents, the foreign and local witnesses, some of whom are immune due to their status as royalty or ministers or heads of state and therefore not compellable witnesses. And imagine the costs of the investigation and the prosecution that will run into millions.

This needs to be emphasised as former attorney-general Tommy Thomas was out of his depth when he hurriedly, post haste, preferred these five charges against Riza without thinking deeply on the complications of proof, the length of the anticipated trial and the costs.

Tommy was and is not a criminal lawyer and can never be one in a compressed time. He had, prior to his appointment never fully practised criminal litigation, not even for a day. But his political masters would have to be blamed for appointing such a candidate to be the AG and automatically the public prosecutor.

Some of those political masters have their own agendas to appoint him as they were facing criminal trials or investigations or accusations.

So, Tommy only attended courts to prefer charges but left the actual trials to be conducted by prosecutors on fiat or regular DPPs. In the SRC trial, actual trial work undertaken by Tommy was minimal.

Considering these complexities in Riza’s case, it is not surprising, therefore, that the US Department of Justice (DoJ) itself, appreciating these hurdles, decided to take action against Riza only for civil forfeiture, not criminal prosecution.

Civil forfeiture, being basically a recovery of assets action has a much lower standard of proof when compared to criminal proceedings which demand onerous proof beyond a reasonable doubt. The DoJ’s decision bears the hallmark of the experience and knowledge of their attorney- generals. This invocation of prosecutorial discretion is important and I will advert to it later.

Then, aside from the mere receipt of the funds in the five charges, the prosecution would have to prove Riza had the necessary knowledge that the funds he received are proceeds of some unlawful activities committed by him or some other persons.

This is a monumental task as Riza’s explanation to the MACC from the earliest opportunity is that these funds were loans provided to his movie production company, Red Granite Productions Inc, for his movie productions.

This is not a hollow narrative. There is a ring of truth to Riza’s claim, which a trial judge has to grapple with, because;

(a). Riza had produced all the contemporaneous loan documentation relating to the receipt of the funds to MACC during their investigations;

(b). Riza is a genuine producer of first-rate Hollywood movies (The Wolf of Wall Street, Dumb and Dumber, Friends with Kids, Children Rise, Daddy’s Home, among others);

(c). The loans from Alsen Chance and Aabar (lenders) dictate the use of the loan funds for movie production and entertainment business only;

(d). The dignitaries behind Alsen Chance and Aabar are people truly connected to the ruling powers of Saudi Arabia and Abu Dhabi respectively ;

(e). Riza’s contemporaneous statement in writing to the MACC when he was first questioned carries the same defence throughout, therefore he was consistent and credible.

At all material times, Red Granite, after successfully producing these movies, had paid off virtually all the loans, plus the accrued interest. This is a critical piece of information as it means the monies Riza received in all the five charges substantively were no longer with him as he had paid them off to the lenders.

The property purchases by Riza in New York, Los Angeles and London are therefore Riza’s own properties as he had discharged all the previous loans, the subject matter of the five charges.

Keep this in mind as it bears critical relevance to the issue of whether Riza really benefited from the Sessions Court compounding the offences and discharging him, all through the industry of his able solicitors, Scivetti & Associates (Scivetti), who had endlessly negotiated for him.

The representation and settlement in court

The representation by Riza to the then AG (Thomas) was made on Nov 18, 2019. It was sent in by the legal firm of Scivetti, whose lawyers, as acknowledged by prosecutor Gopal Sri Ram in open court, are competent.

They specialised in serious crimes, including corporate crimes, litigation and corporate work. Hariharan and I are the two counsel engaged by Scivetti for trial work, should the matter go to trial. I remained as an adviser even for the representation.

The senior DPPs in charge of the case, led by senior counsel Sri Ram and assisted by Akram Gharib, are experienced senior counsel. They could smell blood miles away to move for the kill, if required, and likewise would also appreciate if the hounds are leading them nowhere constructive. They would have carefully advised Tommy, who was in need of their professional advice.

So, when Thomas said in his press statement, dated May 18, 2020, that he would never accept a representation from Riza as he would not betray the prime minister and the Pakatan Harapan government, we will have to examine if Tommy could possibly be telling the truth or otherwise.

Thomas, after an earlier total denial, later back-pedalled and confirmed he minuted on the very letter of representation sent by Riza’s solicitors (Scivetti) on the next day, Nov 19, 2019.

This clearly would have meant that he must have read the representation fully and almost immediately to be able to minute the following to senior DPP Sri Ram:

“In light of the statement in paragraphs 5.10, 5.14, 5.15, 5.18 and 5.19, I am prepared to consider this representation: Paragraph 5.20 contained their terms of a proposed settlement. I await your advice.”

Thomas sought Sri Ram’s opinion on the proposed settlement without any noticeable input by him. The only contribution he offered in writing was with regard to one of the offers by Riza to be a witness in the 1MDB-Tanore trial (where Najib is on trial).

Thomas opined that he was “not convinced that Riza would be a good prosecution witness against his father”. This specific offer, to be a witness, among others, is in the earlier part of the representation letter. So, we can conclude empirically and objectively as follows:

(a) Tommy read the entire representation;

(b) He was not aghast with the representation and the “offer to settle”, otherwise he would have jumped up like a hot piston and summarily rejected the petition, without more;

(c) Due to the above, it is an irresistible conclusion we can draw that he himself was keen to explore the settlement proposed and sought Sri Ram’s opinion;

(d) If Thomas was telling the truth that he would never accept such a representation from Riza (as that would be betraying his PM and the Pakatan government), then why did he show interest in the proposals by seeking Sri Ram’s opinion? Why waste Sri Ram’s valuable time, when the latter was engaged in many urgent cases? So Thomas could not have been so against the proposals, as he now claims;

(e). Further, to enable the proposals to be properly considered, Thomas sanctioned for several adjournments of Riza’s trial, which were initially fixed for Jan 6, 2020 until Jan 9, 2020 and Jan 13, 2020 to Jan 16, 2020. The trial court records show the following reasons were provided to the court for the postponements by the parties:

(i) A senior DPP wrote to the court and copied the letter to Thomas seeking an adjournment of the trial on the grounds that Thomas was still considering Riza’s petition. Thomas minuted on this letter, that was copied to him, that he would want to see the senior MACC DPP to be briefed. They never met as the DPP was away overseas and when he returned, he learned that the petition had been accepted and details were being ironed out. When the DPP contacted Thomas’s office, he was told that it was no longer necessary to have a meeting as the matter had been resolved;

(ii) At least two other postponements were granted dated Jan 31, 2020 and Feb 25, 2020. On the latter date, a lady DPP offered similar reasons for the postponement, this time saying that Thomas was still deciding on the representation, including the supplementary representation sent by Scivetti dated Jan 23, 2020;

(iii) It is important to stress that these postponements consistently attributed that Thomas required more time to finalise a decision on the representation. So, it is not just one request for postponement, but several.

Thomas never rejected the petition outright, but was working towards the final resolution. But he suddenly resigned on Feb 28, 2020 and therefore the new AG completed the process in accordance with the understanding in principle that had been laid during Tommy’s watch.

The current AG need not be concerned with Thomas’s tentative opinion. He could have decided the matter himself but Idrus Harun, to those who know him, is a perfect gentleman and a class act, who paid respect to his predecessor’s views, in spite of the fact that in terms of experience in criminal practice, Thomas cannot measure up to Idrus, a former solicitor-general at the Attorney-General’s Chambers of many years standing in criminal and other fields and who also served as a Federal Court judge.

Among us lawyers, when we assess who is telling the truth, we look at mainly two things :

(a) The reasonableness of the two versions, that is, which is more reasonable in its narrative;

(b) Are the contemporaneous documents and actions supportive and corroborative of one version in preference of the other.

Using this established court technique, Thomas’s version, as demonstrated above clearly comes way short of the truth.

Next, the wide discretion of the AG to discontinue with a case already before the court, pursuant to Article 145(3) of the Federal Constitution and section 254 of the Criminal Procedure Code.

Salim Bashir’s comments

Salim Bashir Bhaskaran, the Bar president, in commenting on Riza’s case, stated quite clinically the position of law of the public prosecutor’s discretion to invoke section 254 of the CPC. I do not see any obvious flaws in that statement.

Salim impliedly conceded he did not have the factual matrix when he correctly observed that “the factors that ought to be taken into account must be dictated by wisdom, relevant consideration and driven by the facts and public interest”.

This is another way of saying that the PP’s discretion to invoke section 254 must be legal, rational and procedurally proper, depending on the factual matrix and the representation made. Only the current AG (not Thomas) knows the fullest facts for him to have invoked the discretion, in consultation with the senior prosecutors.

The criticisms of Salim’s statement is not fair. He meant only to educate the public on the law and its ambit. He did not want to go into the unknown. Salim himself is a seasoned criminal practitioner, among other areas he practises in, and sections 254 and 254A of the Criminal Procedure Code are relatively new amendments, quite unknown in most Commonwealth jurisdictions.

A previous Bar President, George Varughese, commented on the AG’s withdrawal (during Thomas’s watch) of Lim Guan Eng’s case, which was at a very advanced stage in the prosecution’s case, expressing, “not shocked” over the decision and saying the obvious, that it is the absolute prerogative of the PP to drop charges at any stage of a trial, before the delivery of a judgement.

He merely quoted section 254 of the CPC but did not expound on it as Salim did. He continued to say:

“ It is not uncommon for lawyers representing accused persons to make representations to the AGC seeking withdrawal and/or reduction of the charge/s profferred against their clients. And on a regular basis, the AGC does accede to these representations. Further, the DPP has since explained that it was his considered opinion that there is insufficient evidence to succeed at the end of the prosecution’s case. Thus, it is not shocking for the DPP to withdraw the charges as suggested by the MACC. ”

Now, considering the fact that Varughese did not know the factual matrix considered by the DPP who ordered the withdrawal of Guan Eng’s case (Varughese cited none), Varughese’s expression of opinion, as president of the Bar, adds nothing useful and is superficial.

Therefore, what Varughese said was not addressing “where the public thirst for insight lies”, of the issues which the media had described as a
shocking withdrawal of Guan Eng’s charges.

Varughese’s statement did not address:

(a) whether it is right and justified in the public interest, to withdraw serious charges against a senior member of the administration (chief minister) , when the prosecution’s case was in the advanced stage of almost concluding;

(b) what were the factual matters that were mysteriously uncovered by the “parachuted DPP” that was so compelling for the prosecution to withdraw the charges, especially taking into account an earlier similar situation in the case of Khir Toyo (former Selangor menteri besar), which ended in his conviction and imprisonment?

(c) why was the decision taken secretly without consultation with the MACC and the DPPs actually prosecuting the case? How come the “parachuted DPP’ only considered the defence petition and did not hear the views of the prosecution team/MACC? The apparent reason for secrecy was not convincing as it goes against all previous practices of the AGC, even in the most serious and sensitive cases. Given the super sensitive nature of the withdrawal of the charges, secrecy would be anathema to public confidence in the administration of justice. Thomas preached this concept of transparency his entire adult life but never practised this as an AG in this instance.

(d) was there not the appearance of favour shown considering the above factors and the known close relationship between Thomas and Guan Eng where the former was one of the lawyers in this very case and in the Anwar Ibrahim Sodomy 2 case? Should the AG not take extreme care dispelling any appearance of favour or bias shown by taking the safer route which the AGC has been accustomed to, “ let the court decide”. This is especially made worse in the “appearance” department as Guan Eng was appointed to a very senior Cabinet post as the finance minister while his corruption case was pending and ongoing. Would the public not entertain the notion that the premature appointment meant that Guan Eng’s acquittal was a foregone conclusion and someone would be “engineering” his case withdrawal?

In all recorded cases where menteris besar or serving Cabinet ministers were charged, they had to immediately resign (refer to Muhammad Taib’s and Kasitah Gaddam’s cases).

Even mere public servants facing such a dilemma would face interdictions. In the case of Guan Eng, the unthinkable reverse happened; while his trial was ongoing, he was rewarded with the senior Cabinet post.

Salim made a far more elegant and impartial statement, as compared to Varughese who said nothing useful, nor elegant. Salim warned that the court proceedings in Riza’s case are still not over, as indicated by the Senior DPP in relation to fulfilment of the agreed terms and conditions.

Yet, Salim is attacked by senior members of the Bar, including six former Bar Council presidents. Where were these “guys” when Varughese made his useless “tell nothing” statement ? Are there hidden agendas for this selective criticism? I do not think these senior Members of the Bar can preach the virtues of a “fiercely independent Bar” as they showed neither qualities, especially the latter .

The AG/PP’s discretion exercised under Article 145(3) or Section 254 CPC or any prosecutorial discretion is not an absolute power or an unfettered discretion. Our law in this regard has changed dramatically following the changes in England.

The AG/PP’s discretion to withdraw a case, especially one that is advanced in the trial (Guan Eng’s case), or one where the defence had been called , (as in the case of the two women accused in the North Korean KLIA murder case ) can be reviewed by the court, on application, on grounds of illegality, irrationality or procedural impropriety.

Not employing good faith ( power exercised in bad faith ) in such exercise of power is yet another ground. Given Thomas’s own “golden thread”, that runs through his veins when during his short-lived career as the AG/PP, he shamelessly declared he could not have decided Riza’s case the way it was resolved by the current AG as he “would not betray the PM and the PH government”.

Does Thomas know that as an AG/PP, he has to be impartial/independent of any government and/or the prime minister? That woeful statement by him indicates that he was the PH AG and that he takes orders from the PH Cabinet / or the PH prime minister.

This is not a slip of his tongue. It lays naked his thought processes of being political and is not judicious, as demanded of his august office, being the “fountain of justice”.

He recognised that “the AG is no longer a political appointment” in his book “Abuse of Power (2016)” and yet declared he was a political appointee. If in May 2020 he was with that attitude and mentality, the same attitude and mentality would have existed and governed him when he decided to appoint senior DPP Hanafiah Zakaria to review Guan Eng’s case which led to the latter’s charges being withdrawn by the AGC surreptitiously and without the actual DPPs conducting the trial or the MACC being told in a timely fashion and/or consulted.

How could one man, Hanafiah alone, have dictated the fate of that case when Thomas purportedly recused himself from deciding? Do you seriously expect the general public to believe this “Chinese wall” put up by Thomas in the decision made to withdraw Guan Eng’s charges?

Thomas is fond of preaching, and may I remind him now of the famous legal maxim “ Justice must not only be done, but must be seen to be done”, which Thomas is fond of throwing about in less relevant situations.

The law on prosecutorial discretions of the AG/PP is clear. The latest Federal Court judgment in Chin Chee Kow (2019) has cleared the air, namely:

(a) The AG/PP has the sole discretion on matters of prosecution and withdrawal of charges:

(b) But his discretionary decision is not unfettered. In suitable cases, the court can review the decision if the decision is flawed by illegality, irrationality or procedural impropriety or arrived at in bad faith;

(c) Although the AG/PP need not have to disclose his reasons for exercising discretion in such manner in any particular cases, the court can in suitable cases compel the AG/PP to disclose the reasons in order to discover if the discretion has been properly invoked;

(d) For the court to compel disclosure of reasons and to review any particular decision of the AG/PP, the case has to be exceptional although many reported cases in the Commonwealth have reviewed the AG/PP’s discretion on matters of prosecution and withdrawals.

Riza Aziz’s DNAA

The above formulations of law can resolve the two important issues raised herein. In Riza’s situation, any challenge to the decision must show that there are obvious flaws in the four senses mentioned earlier.

Speaking for myself, I cannot point to anything that would indicate that the discretion was wrongly used. Further, the AG/PP is allowed to consider various factual and legal matters in arriving at the decision to accept the representation of Riza on terms.

Consider the following as possibilities : –
(i) the AG/PP may have reconsidered the overall strength of the prosecution’s case to be influenced to accept the representation;

(ii) the AG/PP may have looked at the prosecution’s case in the context of the defence alluded to in the representation;

(iii) the AG/PP may have considered if Riza had actually paid all or most of the loans. Flow of the funds can be easily studied, for this can be established with Riza’s cooperation;

(iv) there may be concern if Riza had actual or constructive knowledge that the funds he received were from proceeds of the crimes or any crimes;

(v) there could be concern that if Riza had paid the loans with interest, there is the possible element that the profits he made using the initial loans are not tainted due to his lack of knowledge and his assets (properties and cash) may not be forfeitable after all;

(vi) the AG/ PP may also have considered that Riza’s offer is sincere as he had long before this been making similar and consistent offers to the DoJ in his recent civil forfeiture case, through his US and Malaysian solicitors.

(vii) the AG/ PP may have also considered the risks of a full trial and Riza may be successful in his defence and the assets Riza offered to the Malaysian government may have to be returned to Riza. You may know that in many of the recent forfeiture cases in our courts, somewhat relating to 1MDB, the prosecution had not been successful to forfeit the assets targeted as they could not show the necessary nexus in the chain of evidence. So, I want to ask those who criticised Riza’s case; how do you know the current AG has not considered all these relevant factors and more?

There is one niggling matter I need to address. This relates to the misleading statement generated by Thomas (and erroneously echoed by Dr Mahathir Mohamad) that Riza’s assets would by agreement between the DoJ and Thomas ( as the previous AG ) be returned to Malaysia.

Both of them are under the misguided assumption that Riza’s seized assets by the DoJ would be returned to Malaysia as of right apparently because Thomas had established strong relations with the DoJ after he took office.

This is a completely misleading statement, The DoJ has been upset with Thomas and the PH government because the DoJ felt they were treated as the “debt collection agency” for Malaysia. Establishing strong relationships with the DoJ will not bring back the money as the due process of US civil forfeiture must be observed.

The Scivetti team thoroughly researched Riza’s case, including meeting up with Riza’s New York lawyers and other lawyers working in DoJ as early as 2017/2018. To believe that DOJ would have returned the money anyway, since it belonged to the country is a naive statement.

Firstly, the civil forfeiture proceeding in the US has to be won by the DoJ. Riza had been contesting them for the last five years. Now, Riza, through his New York lawyers, had negotiated on terms to relinquish his rights to the assets as part of his settlement with DoJ and Malaysia.

Upon DoJ agreeing to the terms, only then those assets would be repatriated to Malaysia. If Riza had continued to contest, for all the reasons earlier mentioned, he may win the proceedings in the US and nothing will be returned to Malaysia as Riza would keep them all.

So when Riza entered into the discharge not amounting to an acquittal (DNAA) arrangement in the KL Sessions Court, he is relinquishing all his affected US and Malaysian assets to the Malaysian government as a global settlement.

For those who think Riza had made a gain by this arrangement, you should get your arithmetic correct. By the global settlement, Riza had paid or agreed to relinquish US$40 million more than the amount of US$248 million, the subject matter of the five charges.

All this because the young man wants to walk away from this nightmare. Riza’s arrangement for a global settlement, including that recently achieved in the Sessions Court, Kuala Lumpur, was undertaken with the sole purpose of providing solace to Riza so that he can start a new life pursuing his interests.

He maintains his innocence of any criminal doings and for that reason agreed to the compound arrangement, which brings about no conviction in law.

Muhammad Shafee Abdullah is a senior lawyer.

The views expressed are those of the author and do not necessarily reflect those of FMT.