1MDB trial: I would have been shocked about the diverted money, says Ahmad Husni

KUALA LUMPUR: Former prime minister Datuk Seri Najib Razak did not respond when he was informed about a US$1bil (RM4.4bil) that was transferred by 1Malaysia Development Bhd (1MDB) to two overseas accounts, including a US$700mil (RM3.08bil) that was diverted to a different account, the High Court heard.

Former second finance minister Datuk Seri Ahmad Husni Hanadzlah, who was testifying in the RM2.28bil 1MDB trial involving Najib, was referring to the US$1bil (RM4.4bil) transaction that was split into two accounts.

"If I were the top leader, I would have been shocked and I would have taken action. But he was just 'relaxed',” said Ahmad Husni here on Wednesday (June 22).

A sum of USD$300mil (RM1.32bil) was transferred into a J.P. Morgan SA account for 1MDB Petrosaudi Ltd (1MDB-Petrosaudi), while USD$700mil (RM3.08bil) was into a RBS Coutts Bank Ltd account, meant for PetroSaudi International (PSI) Ltd, but the account was later revealed to belong to Good Star Ltd.

The court had heard previously that Good Star was initially represented as a PSI subsidiary but later revealed to be controlled by fugitive businessman Low Taek Jho or Jho Low.

"What I know is that the funds were to pay the joint venture (JV) company 1MDB-PSI. What I understand is the money had gone to Good Star.

"Although Najib once told me not to interfere, I did meet up with him several times and asked about 1MDB.

"When I asked him why pay to Good Star, Najib said 'because I have to pay PSI' (sic)," Ahmad Husni said.

He added the diversion of funds would have caused concern for anybody as it involved government bonds but Najib did not respond to it.

Najib's lawyer Tan Sri Muhammad Shafee Abdullah, who conducted the cross-examination, said it wasn't Najib's job to take action on the matter, but rather 1MDB's board of directors.

Ahmad Husni: But Najib was never concerned about it. I met him (Najib) a few times but there was still no action.

Muhammad Shafee: How did you know he did not take action?

Ahmad Husni: If he did, why wait until 2016 to fire (former 1MDB CEO) Datuk Shahrol Azral Ibrahim Halmi and appoint Arul Kanda Kandasamy (Shahrol's successor)?

Muhammad Shafee said Najib could not make the decision himself although he was the chairman of 1MDB's board of advisors and needed to go through the company.

"If the board of directors did not take action, the prime minister has the power to appoint or fire any of the management.

"1MDB had borrowed money from bonds guaranteed by the government. If anything happens, the government had to pay for the loan and this would affect the budget," Ahmad Husni replied.

Najib is on trial for 25 charges in total - four for abuse of power that allegedly brought him financial benefit to the tune of RM2.28bil; and 21 for money laundering involving the same amount of money.

The hearing continues before Justice Collin Lawrence Sequerah on Thursday (June 23).