KUALA LUMPUR (Sept 29): Former 1Malaysia Development Bhd (1MDB) chief financial officer (CFO) Azmi Tahir admitted in court that he didn’t inform new board members in August 2016 that two BSI Bank officers linked to 1MDB’s unit, Brazen Sky Ltd, had been charged in Singapore. Tan Sri Irwan Serigar was appointed chairman of the 1MDB board, with Datuk Kamal Mohd Ali and Datuk Seri Norazman Ayub as new directors then.
The BSI Bank officers, Yeo Jiawei and Yak Yew Chee, were convicted in April 2016 for money laundering and failing to report suspicious transactions. BSI Bank, which worked with 1MDB since 2012, was shut down in May 2016 by Singapore’s Monetary Authority for serious anti-money laundering violations.
Irwan brought in Azmi, Kamal and Norazaman as third parties in 1MDB’s US$6.59 billion lawsuit against him and ex-president and CEO Arul Kanda Kandasamy.
During cross-examination, Azmi admitted he followed instructions from Jho Low and Datuk Shahrol Azral, even though Jho Low had no official role in 1MDB. He also took instructions from Datuk Azlin Alias, Najib Razak’s principal private secretary, and believed both Azlin and Jho Low were acting on Najib’s behalf.
Azmi also said most information about the Brazen Sky investment came from 1MDB’s former legal advisers Jasmine Loo and Terrence Geh — whom he acknowledged were linked to fugitive Jho Low when asked by Irwan’s counsel, Lavinia Kumaraendran.
The former CFO added that the board was not told about the change in Brazen Sky’s fund manager from Vistra to Avestra. He relied on information from Geh based on BSI Bank documents that Brazen Sky was worth US$940 million.
Brazen Sky was formed in the British Virgin Islands in July 2012. It was created to hold assets originating from 1MDB’s earlier joint venture with PetroSaudi International. That 2009 joint venture was first converted into Murabaha notes and later — following a restructuring — into promissory notes valued at US$2.318 billion.
During cross-examination on Monday, Azmi admitted he relied only on verbal communication about 1MDB’s investment in Brazen Sky, where he was also a director. He also said he didn’t have Amicorp’s address when it took over managing the BSI account.
The issue came up when the new 1MDB board asked him to recover the investments in Brazen Sky, which were held in the BSI account, now managed by Amicorp.
Azmi also admitted that when the 2016 US Justice Department report named several 1MDB staff, including Shahrol, Jasmine, Geh and Jho Low, he did not inform the board. He said he didn’t share this because the company was already under investigation by the authorities.
Azmi says Loo and Geh were taking instructions from Jho Low
Azmi told lawyer Razlan Hadri Zulkifli, who represented Kamal and Norazman, that Geh and Loo were nominees of Jho Low and acted in Jho Low’s favour.
He understood that Azlin, as Najib’s private secretary, was representing Najib, just like Jho Low, and that Najib was the chairman of 1MDB’s board of advisers.
Razlan: You are telling me the chairman of the board of advisers of 1MDB (Najib) acted through two persons, Azlin and Jho Low, as proxies.
Azmi: Yes, the criminal case says so.
Azmi explained that the formation of Brazen Sky was to restructure 1MDB’s investment from PetroSaudi.
He agreed with Razlan that besides himself and former 1MDB investment chief Vincent Koh, others in 1MDB didn’t have finance qualifications. He found it strange that their opinions weren’t considered when 1MDB decided to issue RM3 billion in bonds for the purchase of two power plants.
During the trial, Razlan revealed that Azmi’s pay was RM800,000 in 2012, RM1 million in 2013 and RM1.2 million in 2014. Azmi agreed this was fair. Before 1MDB, he worked at Deloitte with a lower salary and said he did his best while at 1MDB.
“I have done my best (as CFO) at 1MDB,” he said.
The trial before Judge Datuk Raja Ahmad Mohzanuddin Raja Mohzan continues on Wednesday.