'Unhappy' 1MDB board felt compelled to approve extra PetroSaudi loan

KUALA LUMPUR (Bernama): The High Court heard on Thursday (Sept 26) that the 1Malaysia Development Bhd (1MDB) board of directors was aggrieved to learn that an additional US$750mil loan request was being made directly to Datuk Seri Najib Tun Razak, and felt it was being forced to approve this loan.

Former 1MDB chief executive officer Datuk Shahrol Azral Ibrahim Halmi, 49, reading from his witness statement, said the matter was discussed by 1MDB’s board at a meeting at the IMC Tower on April 4,2011.

He said the meeting discussed a letter dated Feb 18,2011 from Prince Turki bin Abdullah and Tarek Obaid of PetroSaudi International Limited (PSI) to Najib as an 1MDB shareholder.

"As far as I can remember, Tan Sri Che Lodin Wok Kamaruddin (board chairman) announced the meeting verbally.

"Among the contents of Tarek Obaid's letter was a proposal for 1MDB to increase the lending of US$750mil through Murabaha Note.

"The board at the time felt displeased that the request for additional loan was made directly to 1MDB shareholder, which is Datuk Seri Najib, as if 'forcing the hand of the BOD' to approve the additional loan, ” he said during the examination-in-chief by senior deputy public prosecutor Datuk Seri Gopal Sri Ram at the 14th day of former prime minister’s 1MDB trial.

However, the ninth prosecution witness said after considering that the PetroSaudi International Ltd (PSI) and 1MDB’s relations were government-to-government and Najib's prior consent, the board of directors submitted to the management to further analyse this loan extension.

"It includes the terms of the Murabaha Note and the source of money if 1MDB wants to continue the lending, ” he said.

On Wednesday, the witness told the High Court that fugitive businessmen Low Taek Jho or Jho Low proposed that the joint venture between 1MDB and PSI, which was inactive, be changed from equity to Murabaha Note, as 1MDB could not just terminate the joint venture since it involved bilateral relation between Saudi Arabia and Malaysia.

The key witnesses of the prosecution confirmed that he was present at the meeting and that among the members of the board present were Che Lodin, Datuk Ong Gim Huat (director), Tan Sri Ismee Ismail (director), Ashvin Jethanand (director), Radhi Mohamad and Goh Gaik Kim (secretary).

Shahrol Azral, in reference to a letter from Prince Turki bin Abdullah and Tarek Obaid, dated Feb 18,2011, said he had never seen the letter before.

"However, this letter shows that Prince Turki bin Abdullah stated that there is a new way for both countries (Malaysia and Saudi Arabia) to continue bilateral cooperation through mutual investment, ” he said.

Najib, 66, face four charges of using his position to obtain a bribe of RM2.3bil in the 1MDB funds and 21 charges of money laundering involving the same amount of money.

The Pekan MP was charged with committing the four corruption offences at the AmIslamic Bank Berhad branch, Jalan Raja Chulan, Bukit Ceylon here between Feb 24,2011 and Dec 19,2014 while all the money laundering charges were between March 22,2013 and Aug 30,2013 at the same place.

The trial before Judge Collin Lawrence Sequerah continues. – Bernama