Board of Directors SRC disappointed failed to bring back investment loan from abroad – Witness

Board of Directors SRC disappointed failed to bring back investment loan from abroad – Witness

KUALA LUMPUR: The Board of Directors (BOD) of SRC International Sdn Bhd is disappointed when a RM3.6 billion loan from the Retirement Fund (Incorporated) (KWAP) by the company for investment activities cannot be brought in from abroad, the High Court was told here today.

Former director of SRC International Datuk Che Abdullah @ Rashidi Che Omar, 75, revealed that the former chief executive officer of the company, Nik Faisal Ariff Kamil, informed the BOD that the funds could be withdrawn at any time and there would be no issues in the future.

“Nik Faisal even presented the investment and briefed the board of directors on the returns of the investment. He even told us that the money could be withdrawn at any time,” said Che Abdullah.

He said so when questioned by lawyer Datuk Seri Najib Razak, Muhammad Farhan Muhammad Shafee, in the civil suit of AS$1.18 billion SRC International against the former prime minister and Nik Faisal, who fled the country in 2018. Previously, in the criminal trial of SRC International, former Deputy Vice President of KWAP, Fixed Income Division, Amirul Imran Ahmat, testified that Najib approved the loan application submitted by SRC International to KWAP for use as working capital and general investment without limit.

For the record, SRC International made a loan of RM4 billion from KWAP between 2011 and 2012, and the majority of it, RM3.6 billion, was transferred to a bank account in Switzerland and frozen by the authorities there.

In response to another question, Che Abdullah also told the court that no proper effort was made on the first RM1.8 billion loan from KWAP before transferring it to offshore accounts, allegedly for investment activities.

“My understanding is that reasonable efforts must be made before any investment activity is continued. After the investment, you can only monitor. The money has been transferred, so what more reasonable efforts can be made?” he said.

Last month, former SRC director Datuk Shahrol Azral Ibrahim Halmi, who was also named as a third party, similarly stated when telling the court that the company failed to exercise due diligence on the involved RM1.8 billion loan.

Shahrol Azral said no proper effort was made because the resolution of the board of directors (DCR) had been signed and approved by Najib, who was also the prime minister and finance minister at the time.

Previously, SRC had dropped five former directors, including Che Abdullah, from the lawsuit and only retained Najib as the sole defendant. However, the High Court allowed Najib’s application to issue third-party notices against them in the lawsuit filed by SRC International against him.

Under its new management, SRC filed the lawsuit in May 2021, alleging Najib committed breaches of trust and abuse of power, personally benefited from the company’s funds, and misused those funds.

It also sought a court declaration that Najib is responsible for the company’s losses due to breach of his duties and trust and that Najib repay the RM42 million losses they suffered.

Najib, 70, has been serving a prison sentence at Kajang Prison since August 23, 2022, after being found guilty of misappropriating RM42 million from SRC International.

He later filed a petition for royal pardon on September 2, 2022.

Following the decision on the pardon, Najib’s prison sentence has been reduced from 12 years to six years, while the fine has been reduced from RM210 million to RM50 million.

The trial before Judge Datuk Ahmad Fairuz Zainol Abidin continues on May 20.

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