TRIAL judge Mohd Nazlan Mohd Ghazali today questioned former KWAP chief executive Azian Mohd Noh on a gap in her testimony over how its loan recommendation for RM1 billion to SRC International in 2011 ended up becoming RM2 billion.

SRC International, a government entity at the centre of Najib Razak’s criminal trial, received its first loan of RM2 billion in four tranches of RM500 million each on August 29, 2011. 

Kuala Lumpur High Court judge Nazlan addressed the witness directly – an uncommon occurrence – on the chronological gap in her witness statement.

Nazlan said the statement, which has 56 paragraphs, was mostly in chronological order with exception to paragraphs 23 and 24.

In her statement, Azian said she accompanied KWAP chairman Wan Abdul Aziz Wan Abdullah to meet Najib, who was then prime minister, at his office in Putrajaya sometime in July or August, 2011.

The meeting was to inform Najib that the KWAP investment panel had decided that it would only approve a loan of RM1 billion despite a request by SRC International for RM3.95 billion. 

However, in the following paragraph, Azian said KWAP’s fixed income department assistant vice-president Amirul Imran Ahmat prepared the investment paper for a RM2 billion loan to SRC International.

“Why is there a jump from RM1 billion to RM2 billion?” Nazlan asked Azian.

“Yang Arif, I am afraid I cannot remember the sequence of events,” Azian said. 

“I have stated earlier that at the subsequent meeting of the investment panel, Tan Sri Wan communicated to me, requesting me to inform the investment panel that the prime minister has communicated to him for KWAP to expedite the loan and that the amount of RM2 billion would suffice.”

Azian testified yesterday that KWAP’s loan application came in the form of a three-page letter handed to her personally by Azlin Alias, a senior aide of Najib’s, at a hotel lobby.

She said the first loan of RM2 billion to SRC International in 2011 was approved before a formal government guarantee was secured.

Examined by deputy public prosecutor Ishak Mohd Yusoff, Azian was asked if she had ever encountered another similar situation where a loan was granted prior to obtaining supporting documents, such as a government guarantee letter.

Ishak: Under your tenure as the CEO of KWAP, was it normal for you to disburse the loan amount first before getting the guarantee letter?

Azian: It has never happened except for in this scenario.

She said it would have been ideal if KWAP got the guarantee document before it approved any loan.

Ishak: Has something like that happened before.

Azian: Not in my career in KWAP.

Azian was then pressed on whether it was deemed a serious issue that KWAP did not obtain an official government guarantee before it disbursed the loan.

She responded by saying that while a government guarantee did not materialise at the moment of approval, a “letter of comfort” or awareness from the Finance Ministry indicating a guarantee was forthcoming would be sufficient.

While cross-examined by defence counsel Yusof Zainal Abiden, Azian said KWAP agreed to disburse the loan based on the comfort letter from the ministry, which said that the cabinet has approved the government guarantee.

Azian also told defence counsel Harvinderjit Singh that during her tenure at KWAP, the RM4 billion loaned to SRC International was the largest loan sum ever approved by the retirement fund.

Najib’s charges in this trial are related to the RM4 billion loan to SRC International made out in 2011 and 2012, for which he is accused of receiving RM42 million in his accounts in 2014 and 2015.

He faces three counts of criminal breach of trust, three counts of money-laundering and one count of abuse of power. If convicted, he faces up to 20 years’ jail.

Najib is represented by a dozen lawyers led by Muhammad Shafee Abdullah. Attorney-General Tommy Thomas leads the prosecution. – May 29, 2019.