SRC BOD never informed about application for government guarantee

KUALA LUMPUR: The Board of Directors (BOD) of SRC International Sdn Bhd has never been informed of the company’s application for government guarantee for a RM3.95 billion loan from the Retirement Fund (Incorporated) (KWAP) in 2011, the High Court was told.

The application was disclosed via a letter signed by Nik Faisal Ariff Kamil as the Managing Director and Chief Executive Officer of SRC addressed to the Ministry of Finance.

Ismee Ismail

The letter was shown to Tan Sri Ismee Ismail, 54, former board member of SRC by lawyer Harvinderjit Singh who represented former prime minister Datuk Seri Najib Tun Razak on the 23rd day of his trial.

Harvinderjit: You were never told about this letter?
Ismee: Yes.
Harvinderjit: This was a material fact that was hidden by Nik Faisal from the board?
Ismee: Supposedly like that.
Harvinderjit: This letter gives the impression that Nik Faisal acted on behalf of 1Malaysia Development Berhad (1MDB)?
Ismee: Yes.
To another question, the 39th prosecution witness agreed that the company’s BOD was uncertain about the veracity of a proposed joint venture involving Abu Dhabi-based company, Aabar Investments PJS.

Harvinderjit was referring to the minutes in which Nik Faisal told the company’s board in 2011 about the proposed joint venture following a high-level meeting between representatives of Malaysia and Abu Dhabi, which led to the initial application by SRC for an RM3.95 billion loan from KWAP.

Harvinderjit: There was a meeting in June 2011 where both parties had a discussion, Malaysia and Abu Dhabi, on strategic resources. This referred to Najib?
Ismee:
Yes.
Harvinderjit: Since then, there was rapid implementation and disbursement of the launching grant (to SRC International). It goes on to show how Nik Faisal told the board about a high-level discussion between Malaysia and Abu Dhabi representatives, then this company (Aabar-BVI) was incorporated. (This involved) a proposed joint venture arrangement. The launching grant and process (of loan from) KWAP hinged on this potential deal with Aabar Investment?
Ismee:
Yes.
Ismee also concurred with Harvinderjit’s assertion that the BOD was not shown any other documents by Nik Faisal as proof of this proposed joint venture.
Harvinderjit: The board had the impression of this (joint venture) being government-to-government. That put a stop to further inquiries about the deal?
Ismee:
Yes.
Harvinderjit: Whether that was true or not, or whether there was any (government) department working on the Aabar deal, you did not know?
Ismee nodded his head.
Harvinderjit: He (Nik Faisal) gave the impression he knew more?
Ismee:
Yes.

Najib, 66, is charged with three counts of criminal breach of trust, one count of abusing his position and three counts of money laundering involving SRC International Sdn Bhd funds amounting to RM42 million.

Hearing before High Court Judge Mohd Nazlan Mohd Ghazali continues. – Bernama