KUALA LUMPUR: Former 1Malaysia Development Bhd (1MDB) CEO Mohd Hazem Abd Rahman told the High Court Thursday (Sept 17) that he wanted to resign from the position amid concerns of the company being riddled with debts.
Hazem - who replaced predecessor Datuk Shahrol Azral Ibrahim Halmi in 2013 - said he began worrying that 1MDB was knee-deep in debts and doubted its capacity to repay them in early 2014.
“Among the debts that had to be paid in 2014 was a RM2.5bil Maybank loan taken by 1MDB to buy Tanjong Power shares in 2012.
“There were many 1MDB expenses which involved project financing funds such as development of infrastructure for TRX (Tun Razak Exchange) and Jimah (Jimah Energy Ventures), which were financed through new debts, ” he said.
The 10th prosecution witness was reading his 110-page witness statement at the 1MDB trial involving former prime minister Datuk Seri Najib Razak here on Thursday.
At the same time, Hazem said he did not know whether 1MDB still had its funds abroad or that it had been used for Umno.
“The funds abroad, in my estimation, were about US$3.8bil (RM13bil). This money was enough to pay off the Maybank debt and to serve as capital for any 1MDB project in Malaysia, ” he added.
The 48-year-old witness said he became increasingly worried and had many questions on the management of the funds abroad because he did not have access to this despite being the CEO.
“Only (fugitive businessman) Low Taek Jho and (general counsel) Jasmine Loo know about this (the funds abroad), ” he added.
Hazem said as the CEO, he should have had full authority to control the ins and outs of the funds from abroad to the country because the funds should be controlled by the company’s management.
“However, I received instructions from Low not to disturb the funds abroad, ” he added.
Hazem said he often met with Najib’s late principal private secretary Datuk Azlin Alias to tell him about his (Hazem's) concerns.
“I told Azlin my intention to resign and to be replaced by somebody who could head 1MDB in its debt-laden state.
“I emailed (1MDB chief financial officer) Azmi Tahir about my worries regarding the unreasonable plans made by Low for 1MDB as early as September, 2013. I also told Azmi my intention to resign, ” he said.
Hazem said Azlin often advised him to wait and to only resign after the listing of 1MDB Energy on Bursa Malaysia.
However, at the end of October 2014, Hazem came back from performing the hajj and spoke seriously about resigning to Low and Azlin.
"I told Azlin to tell Low to find a candidate that could replace me because all of the officers below me did not want to replace me as the CEO position was exposed to a lot of political elements, ” he added.
On Jan 3,2015, Hazem returned from a holiday and was informed by Azlin that they had found a candidate for the post of assistant CEO.
Hazem said he was asked to hold the CEO post until the listing of Edra Energy (1MDB’s subsidiary) on Bursa Malaysia in mid 2015.
“On Jan 5,2015, Arul Kanda Kandasamy came to report as 1MDB president, which meant that as the CEO, I should report to him. At that time, I thought that it was the appropriate time to resign as the post of president is similar to a CEO, ” he added.
Najib, 67, is facing four charges of abusing his position to obtain gratification totalling RM2.28bil in 1MDB funds and 21 counts of money laundering involving the same money.
The hearing before Justice Collin Lawrence Sequerah continues on Oct 5.
Did you find this article insightful?
94% readers found this article insightful