Zeti: BNM recommended RM23mil penalty against 1MDB

KUALA LUMPUR: Bank Negara had recommended a penalty of RM23mil against 1Malaysia Development Bhd (1MDB), but the then Attorney General (AG) reduced the fine to RM15mil, says the central bank’s former governor Tan Sri Dr Zeti Akhtar Aziz .

The 76-year-old witness told the High Court here that, in order to impose a penalty, Bank Negara needed the consent or permission of the AG.

“The AG refused the amount recommended by us. We recommended RM23mil. However, the AG reduced it to RM15mil,” she said here yesterday, reported Bernama.

The 46th prosecution witness said this when asked by Datuk Seri Najib Razak’s lead counsel Tan Sri Muhammad Shafee Abdullah at the former prime minister’s trial involving alleged misappropriation of RM2.3bil of 1MDB funds.

Tan Sri Mohamed Apandi Ali was the AG at that time.

In her witness statement, Zeti said the inability of 1MDB to bring the monies back and to provide evidence on the status of the funds, resulted in a compound being imposed on the sovereign wealth fund.

1MDB paid the compound on May 25, 2016.

Muhammad Shafee had asked: “Were there any attempts by the then finance minister (Najib) to waive this fine imposed on 1MDB?”

Zeti answered: “I have no knowledge.”

Apart from that, Zeti also said that AmBank did inform her that Najib would be opening an account with the bank, but said the bank’s managing director Cheah Tek Kuang did not tell her that there were expected incoming donations.

Once again, she maintained that the central bank does not conduct due diligence on individual accounts, and that this was the duty of the financial institution involved.

Zeti’s testimony contradicts Cheah’s previous testimony as the 39th prosecution witness in the same 1MDB trial, where the latter said he had told Zeti about the purported incoming “donation”.

Cheah had on Oct 4, 2022, told the High Court that he followed the AmBank chairman’s instructions and went to Najib’s house in early 2011 to help the latter with documents for opening the bank account, where Najib claimed that there would be a US$100mil donation coming in from the Saudi Arabian government for him for Islamic activities.

Najib, 70, faces four charges of using his position to obtain bribes amounting to RM2.3bil belonging to 1MDB and 21 charges of money laundering involving the same amount.

The trial before Justice Datuk Collin Lawrence Sequerah continues today.