SRC trial: Despite CEO's contrary claims about 2013 accounts, board didn't inform Najib

KUALA LUMPUR: The High Court here has been told that although the 2013 accounts of SRC International Sdn Bhd were not audited, contrary to chief executive officer Nik Faisal Ariff Kamil’s claims, the board of directors did not raise the matter with Prime Minister Datuk Seri Najib Razak.

Former chairman Tan Sri Ismee Ismail said this under cross-examination by Harvinderjit Singh, Najib’s counsel, on Thursday (June 13).

Ismee said because Nik Faisal was the communications link between SRC International's board of directors and Najib, who was adviser emeritus of the company, he (Ismee) did not have any contact with Najib during his tenure as chairman.

When he found out that the company's 2013 accounts were not audited despite Nik Faisal asking the board to sign a resolution to approve the accounts, claiming they had been audited, Ismee said he took it upon himself to resolve the issue.

This was despite his telling the court that it was implied (tersirat) that Najib was his “boss”.

Harvinderjit: Would you accept that at some point in time, it would have been incumbent on you to escalate the matter to either to Ministry of Finance (Incorporated) or a department in MoF (Inc) or the Prime Minister directly when you got the impression that Nik Faisal was not telling the truth?

Ismee: Agreed.

Harvinderjit: (Referring to the unaudited accounts). And in that point in time, you did not think it was serious enough to doubt Nik Faisal?

Ismee: I investigated why the accounts were not audited.

Ismee said he contacted Deloitte – which was SRC International's external auditor at that time – to resolve the issue, successfully closing the accounts.

Harvinderjit: In your mind, the chief executive officer lying to the board about the fact that the accounts have been audited was not serious enough to be escalated (to Najib)?

Ismee: I can't say.

Ismee had earlier told the court that he resigned from SRC International due to issues related to the unaudited accounts.

Najib's lead counsel Tan Sri Muhammad Shafee Abdullah later made an application for the court to be adjourned to give time for the defence team to look over resolutions and transcripts due to alleged discrepancies between Ismee's written and oral testimonies.

Deputy public prosecutor Datuk V. Sithambaram did not object, saying both sides would make use of the day to go through Ismee’s transcript before deciding on the next course of action.

Proceedings will continue on Friday (June 14) in front of Justice Mohd Nazlan Mihd Ghazali.

Najib is facing seven charges involving RM42mil in funds belonging to SRC International, formerly a subsidiary of 1Malaysia Development Bhd (1MDB).

On July 4 last year, Najib claimed trial to a charge of abuse of power and three counts of criminal breach of trust linked to the 1MDB scandal.

He allegedly misappropriated RM42mil in funds belonging to SRC International.

On Aug 8 last year, he was charged with three counts of money laundering involving the same RM42mil.