KUALA LUMPUR: The former chief executive of 1Malaysia Development Bhd (1MDB) today gave further insights on how the sovereign wealth fund was run, including his mindset of doing things in Team Najib while managing affairs.
Datuk Shahrol Azral Ibrahim Halmi revealed how fugitive businessman Low Taek Jho @ Jho Low had constantly impressed on him the importance of "keeping the Arabs happy" whenever he was asked to rush things at 1MDB.
The 49-year old also admitted that because of this he never bothered to check some very important details or do something which could have prevented the sovereign wealth fund from drowning itself in debt.
This included the fact that 1MDB would be taking on a US$700 million debt immediately upon signing a joint venture agreement (JVA) with PetroSaudi Holdings (PSI) (Cayman) Ltd in 2009.
Shahrol acknowledged that he never bothered to inform the 1MDB board of directors of the debt before the joint venture agreement was inked.
All this was revealed when he was cross-examined by lawyer Tan Sri Muhammad Shafee Abdullah, who is the lead counsel in Datuk Seri Najib Razak's defence team.
Shahrol, who is the ninth prosecution witness, started off by answering questions on how 1MDB was established from its original existence as the Terengganu Investment Authority (TIA).
He said almost immediately after that 1MDB signed the JVA, even though he knew that PSI had entered into a loan agreement with its Cayman-based holding company to the tune of US$700 million.
Shahrol said he had flown to London with the then 1MDB executive director (business development) Casey Tang - a Jho Low appointee in1MDB - to visit the law firm which had handled the loan agreement.
Shafee: Did you see the agreement? To say that this is a loan agreement is a misnomer. It is actually an agreement for PSI to buy a US$1 company in the Caymans for US$700 million
Shahrol: I cannot remember whether I saw the agreement. However I may have been shown the agreement during one of the Public Account Committee (PAC) hearings in 2010 and 2016
Shafee: This is not something one can easily forget. It involves putting 1MDB US$700 million in debt immediately after it signs the JVA
Shahrol: Correct...but I was briefed by Jho Low that this was because of the value of assets which were injected by PSI into the JVA.
Shafee: Obviously the 1MDB board never knew of this agreement before entering into the JVA. Otherwise they would never have agreed to it
Shahrol: I agree
Shahrol then went on to explain that he left it to Casey Tang to handle the issue due to the latter's superior experience.
He said that he never asked for further details as "I was led to believe this is a government to government transaction involving trustworthy partners.
"So my framing at that point was more towards executing the deal to ensure we meet the deadlines.
"For the lack of a better phrase, it was to keep our partners happy, This whole thing was based on friendship and political considerations," he said.
Asked if he had ever checked with Najib on the veracity of Jho Low's claims that Najib wanted it done, Shahrol acknowledged that he never did so.
He said this was because at that time he recognised that working in Team Najib` involved working in silos where he need not worry about the details as it was managed by Jho Low.
However, Shahrol said he always felt discouraged to find out more about what was going on throughout his tenure as 1MDB CEO from 2009 to 2013.
Shafee: Did Najib ever tell you not to ask questions?
Shahrol: I had the opportunity to stand next to him during a corporate social responsibility (CSR) programme once. I asked him if there was anything that could be done to get our money back. However, he just answered that I should talk to Jho Low. From then on I felt discouraged to find out anything beyond my silo.
Shafee: But no one stopped you from finding out
Shahrol: Nobody stopped me
Shafee: So you chose not to.
Shahrol: I was discouraged from finding out further.
Najib, 66, is facing 25 counts of misappropriating 1MDB funds, money laundering and abuse of power.
The trial before High Court judge Collin Lawrence Sequerah continues on Thursday.