KUALA LUMPUR (July 27): Former BSI Singapore banker Kevin Swampillai said he was solely responsible for providing “misstatements” to 1Malaysia Development Bhd’s (1MDB) auditor KPMG about the true nature of assets kept in an account that has been invested in a fund managed by Bridge Partners.
Testifying at the 1MDB-Tanore trial as the 44th prosecution witness, Kevin said he had given KPMG inaccurate information about the underlying Bridge Partners fund upon questioning from lead defence lawyer Tan Sri Muhammad Shafee Abdullah.
“Well actually Tan Sri, I have to categorically state that I was solely responsible for providing the misstatements to KPMG, the inaccuracies about the underlying fund, that was all on me. I am responsible for that,” he said.
Previously, Kevin, 58, who was the former head of wealth management services at BSI Singapore, had testified that Terence Geh Cho Heng of 1MDB did not want KPMG to know the nature of the underlying assets in the Bridge Partners funds (Bridge Funds) in 2012 when the auditor came to query BSI.
“The December 2012 meeting was intended to give KPMG an understanding of the Bridge Funds invested by Brazen Sky. The meeting was requested by Terence Geh, who also instructed me not to give any information to KPMG about the true nature of the actual underlying investments of the Bridge Funds,” he said.
“BSI Bank had no obligation to disclose any information to the client’s auditors unless expressly authorised by the client. In the case of Brazen Sky, I was directed by Terence Geh not to disclose any information about the underlying assets in the Bridge Funds,” he added.
“Terence Geh did not want his auditors to know the nature of the underlying assets in the Bridge Funds. I received these instructions from Terence Geh during a phone conversation on this matter, and consequently BSI did not disclose such information to KPMG,” he said before High Court judge Datuk Collin Lawrence Sequerah in March.
On March 16, 2022, the BSI banker had also testified in the New York trial of ex-Goldman Sachs banker Roger Ng.
In that trial, Kevin said that Geh told him KPMG would be asking about the account that was supposed to hold liquid assets valued at US$2.3 billion. Geh, who was 1MDB’s executive director of finance, told him not to reveal to the auditor that the only assets were two illiquid drilling ships.
The US$2.3 billion that was parked in a Cayman-registered fund was a point of contention that 1MDB had with its auditor, and when KPMG refused to sign the FY2013 accounts unless it was provided with more proof of the nature and value of the Cayman fund plus a few others, it was sacked as 1MDB's auditor on the instruction of then prime minister Datuk Seri Najib Razak and replaced by Deloitte.
In the trial on Thursday (July 27), Kevin also testified that Geh had insisted that he did not want KPMG to know that the underlying investments which were being asked about were the two drill ships.
“He wanted KPMG to walk away thinking that the investments were made up of stocks, and other investments instead of the drill ships,” he said.
The witness added that Geh was also fixated on making KPMG think that the investments 1MDB were involved in were worth specifically US$2.318 billion.
Shafee: Terence wanted this scam not to be revealed. In other words, he wanted BSI to mislead KPMG.
Kevin: Yes, that’s correct.
Najib is on trial for four counts of abuse of power and 21 counts of money laundering involving RM2.28 billion of 1MDB funds.
The Edge is covering the trial live here.
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