KUALA LUMPUR (Sept 19): Former prime minister Datuk Seri Najib Razak received approximately US$30 million in his AmBank private account in 2012, which was purportedly 1Malaysia Development Bhd (1MDB) funds, the High Court here was told.
Testifying as the prosecution's 47th witness in Najib’s 1MDB-Tanore trial, Bank Negara Malaysia (BNM) analyst Adam Ariff Mohd Roslan said that Najib received the money into his account (AmPrivate Banking, account number ending 694) from Blackstone Asia Real Estate Partners, which was set up by fugitive businessman Low Taek Jho or Jho Low.
Adam, who was referring to Najib’s bank statement records, said that US$5 million was credited into Najib’s account on Oct 30, 2012, followed by a further US$25 million on Nov 19 that year.
In Tuesday's proceedings, Adam spent the whole morning chronicling how the money from 1MDB, through financial manoeuvring by Jho Low, ended up in Najib’s coffers, among others.
Known as the “Aabar BVI” phase of the 1MDB scandal, this involved the issuance of two separate bonds by 1MDB through its wholly owned subsidiaries 1MDB Energy Ltd (1MEL) and 1MDB Energy (Langat) Ltd (1MELL) in 2012.
The issuance of the bonds was arranged and underwritten by Goldman Sachs International in order to raise additional capital for the purpose of acquiring energy assets.
The witness said that on May 22, 2012, 1MEL received US$907,500,000, and on the same day transferred US$576,943,490 to Aabar BVI, a joint-venture company.
As for 1MELL, he testified that it received US$1,640,000,000 on Oct 19, 2012 from Goldman Sachs. He later added that before this transfer, the 1MELL account did not have any money in it.
On the same day, 1MELL transferred US$790,354,855 to Aabar BVI in round figures as a security deposit for Aabar's holding company, International Petroleum Investment Company or IPIC, for allegedly guaranteeing the repayment.
Adam testified that for Aabar BVI (the fake Aabar, Aabar Investments PJS Ltd), its account's beneficial owners were Khadem Abdulla Al-Qubaisi and Mohamed Ahmed Badawy Al-Husseiny.
It was previously revealed in the trial that Jho Low incorporated Aabar BVI in the British Virgin Islands to mirror the subsidiary of IPIC. The real subsidiary of IPIC is Aabar Investments PJS, without "Ltd".
The remaining proceeds from 1MELL’s account were transferred to Blackstone via the Cistenique Investment Fund and Enterprise Emerging Markets Fund (EEMF).
The witness detailed that in October 2012, Aabar BVI gave an instruction to BSI Bank Ltd, Singapore, in relation to its account with BSI SA, Lugano, to invest into Cistenique. However, the transaction was reversed.
Aabar BVI subsequently booked the transaction again through Citco Bank Nederland. The nominal value of subscription to Cistenique was US$285 million.
Adam testified that Blackstone’s bank statement and records showed that Cistenique then sent it US$285 million on or around Oct 24, 2012, a day after Aabar BVI subscribed to US$285 million in Cistenique.
Adam testified that in November 2012, Aabar BVI made an additional instruction to invest into EEMF. The investment amount was US$96,938,776. The nominal value of subscription to EEMF was US$95 million.
The witness said that Blackstone’s bank statement and records showed that EEMF then sent it US$95 million on or around Nov 8, 2012, a day after Aabar BVI subscribed to US$95 million in EEMF. It was from here that US$30 million was transferred into Najib’s account.
In the opening statement of the prosecution at the beginning of the trial in 2019, the then lead prosecutor, the late Datuk Sri Gopal Sri Ram, said that the Aabar BVI phase or, as he called it, the second phase of the 1MDB scandal had to do with the acquisition of assets of dubious value by 1MDB.
He said that Najib, acting through Jho Low, took positive steps and caused 1MDB to enter into two transactions, as a result of which Najib obtained a sum of RM90,899,927.28 (the aforementioned US$30 million) as gratification.
These two transactions concerned the acquisition of two independent power producers, namely Tanjong Energy Holdings Sdn Bhd and Mastika Lagenda Sdn Bhd. Mastika owned 75% shares in Genting Sanyen Sdn Bhd.
To make the transactions, 1MDB acted through 1MEL, 1MELL and 1MDB Energy Holdings Ltd.
A local bridging loan of RM6.17 billion was raised for the acquisition of Tanjong Energy. An additional sum of US$1.75 billion was raised through the issue of 10-year structured loan notes. Goldman Sachs was appointed as the lead arranger for the issuance of these notes.
Of the US$1.75 billion, US$786 million went to Tanjong Energy. Of the balance, a sum of US$907 million was paid into the account of 1MEL with Falcon Bank in Hong Kong. Of this sum, approximately US$577 million in round figures went to Aabar BVI. This payment was purportedly as a security deposit for Aabar's holding company IPIC issuing a guarantee guaranteeing the notes. In addition to the security deposit, Aabar was also given an option to take up 49% shares owned by 1MEL in 1MDB Energy Sdn Bhd.
On May 22, 2012, US$295 million was paid by Aabar to Blackstone, controlled by Jho Low through his associate Tan Kim Loong, also known as Eric Tan, who is also a fugitive from justice. Additionally, on July 25, 2012, a further sum of US$133 million was transferred by Aabar to Blackstone. These monies remained with Blackstone until October 2012. Goldman Sachs was paid US$192.5 million as arranger's fees for this bond issuance.
For the Mastika acquisition, the alleged purchase price was RM2.75 billion. The money for this came from two sources. First, another 10-year structured loan notes of US$1.75 billion. For this, 1MDB paid Goldman Sachs US$110 million as arranger's fees. So, 1MDB got a net sum of US$1.64 billion. This sum was paid into 1MELL's account with Falcon Bank, Hong Kong. The second was a local loan of RM700 million. The total loan raised from these two sources was about RM6.16 billion. There was therefore an excess of RM3 billion.
This excess was almost wiped out by a payment on Oct 23, 2012 to Aabar BVI of a sum of approximately US$790 million in round figures as a security deposit for Aabar's holding company IPIC for allegedly guaranteeing the repayment of the notes. As additional security, Aabar was given an option to take up 49% shares owned by 1MELL in 1MDB Energy (Langat) Sdn Bhd. For the Mastika acquisition, Genting Power was paid US$710 million. The loan raised through the notes for the Mastika purchase came into 1MELL's account on Oct 19, 2012.
On Oct 23, 2012, Aabar paid a sum of approximately US$291 million in round figures to Cistenique. On the same day, it paid US$76 million to EEMF, and US$75 million to Blackstone. This was part of the US$790 million paid to Aabar. Later on Nov 5, 2012, Aabar paid a further sum of US$96 million to EEMF. Soon after Cistenique and EEMF received the monies in question, they paid it over to Blackstone. These monies were then channelled by Blackstone to Najib’s account to the tune of US$30 million.
Najib is on trial on four counts of abuse of power and 21 counts of money laundering involving RM2.28 billion of 1MDB funds.
The trial before judge Datuk Collin Lawrence Sequerah continues.
The Edge is covering the trial live here.
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