KUALA LUMPUR – The high court was told today that the SRC International Sdn Bhd board of directors was frustrated when the RM3.6 billion loan obtained by the company from Retirement Fund Inc (KWAP) for investment activities was unable to be repatriated from abroad.
Former director of SRC International Datuk Che Abdullah @ Rashidi Che Omar, 75, revealed that the company’s former chief executive officer Nik Faisal Ariff Kamil informed the board that the fund can be withdrawn anytime and it would not be any issue in the future.
“Nik Faisal even presented the said investment and briefed the board on the return of the investment. He even told us that the money can be withdrawn anytime,” said Che Abdullah.
He said this when queried by Datuk Seri Najib Razak’s counsel Muhammad Farhan Muhammad Shafee at SRC International’s US$1.18 billion civil suit against the former prime minister and Nik Faisal, who was absconded from the country in 2018.
Previously, in SRC International’s criminal trial, KWAP’s former assistant vice-president (Fixed Income Department) Amirul Imran Ahmat testified that Najib approved the said loan application submitted by SRC International to KWAP for use as revolving capital and unlimited general investment.
For the record, SRC International took a loan of RM4 billion from KWAP between 2011 and 2012, out of which RM3.6 billion was transferred to a Swiss bank account that is currently frozen by the Swiss authorities.
To another question, Che Abdullah told the court that no due diligence was conducted on the first KWAP loan of RM1.8 billion before transferring it offshore for purported investment activities.
“My understanding is that the due diligence must be performed before you proceed with the investment.
“After the investment, you can only monitor. The money was already transferred out and what due diligence can be done?” he said.
Last month, another former director of SRC International, Datuk Shahrol Azral Ibrahim Halmi testified that no due diligence was carried out as the directors’ circular resolution was signed and approved by Najib, who was the prime minister, finance minister, sole shareholder of SRC International and advisor emeritus of the company at the material time.
SRC previously removed five of its directors from the lawsuit including Che Abdullah, retaining Najib as the sole defendant, however, the high court later granted Najib permission to issue third-party notices against them.
Under new management, SRC filed the suit in May 2021 claiming that Najib had committed a breach of trust and abuse of power personally benefited from the company’s funds and misappropriated the same.
It is seeking a court declaration that Najib is responsible for the company’s losses due to his breach of duties and trust and for him to compensate the RM42 million in losses they have incurred.
Najib, 70, has been serving a jail sentence at the Kajang Prison since Aug 23, 2022, after being convicted of misappropriating RM42 million in SRC International funds.
On September 2, 2022, he submitted a petition for a royal pardon, and on January 29 this year the Pardons Board decided to reduce Najib’s prison sentence from 12 to six years, along with reducing the fine from RM210 million to RM50 million.
The trial before judge Datuk Ahmad Fairuz Zainol Abidin continues on May 20. – May 9, 2024