THE SRC International Sdn Bhd trial today reaches the submissions stage, where lawyers will argue whether Najib Razak, who faces seven charges, will have to enter his defence for allegedly misappropriating RM42 million in public funds.

Kuala Lumpur High Court judge Mohd Nazlan Mohd Ghazali will hear arguments from both the defence and prosecution on whether there is a prima facie case against the former prime minister.

If that is established, Najib will be asked to enter his defence.

Nazlan will deliver his decision on November 11.

Najib’s ongoing 1Malaysia Development Bhd trial has been adjourned to allow lawyers to submit their arguments over the next few days.

Lead defence counsel Muhammad Shafee Abdullah has informed 1MDB trial presiding judge Collin Lawrence Sequerah that the defence’s written submissions may be 1,000 pages long.

The prosecution’s case in the SRC International trial saw 57 witnesses testifying on 57 hearing dates between April 3 and August 27.

Attorney-General Tommy Thomas, who leads the prosecution today, previously told the court that a list of 66 witnesses has been prepared should the defence be called later.

Nazlan has said the trial will continue from December 3 to 19 should Najib be ordered to enter his defence for all or some of the charges.

The charges in the SRC International case are linked to RM4 billion in loans issued to the entity in 2011 and 2012, for which Najib is accused of receiving RM42 million in his accounts in 2014 and 2015.

The 66-year-old has been slapped with three counts of criminal breach of trust, three counts of money-laundering and one count of abuse of power.

He faces a total of 42 charges, spread out over five criminal trials.

The 1MDB trial involves the biggest amount – RM2.282 billion that he allegedly received between 2011 and 2014.

For his yet-to-be-heard trials, Najib faces six counts of CBT involving RM6.6 billion in government money paid out to settle debts with Abu Dhabi sovereign wealth fund International Petroleum Investment Company, one count of abuse of power for tampering with the 1MDB audit report, and three counts of money-laundering involving RM27 million in SRC International funds.

The trials will proceed one at a time, as Najib’s right as an accused requires that he be present for all trial hearings, as well as those on interlocutory matters, to ensure fair proceedings.

The burden of proof is on prosecutors, who must prove that Najib is guilty beyond reasonable doubt. Till then, he is presumed innocent.

The Malaysian Insight brings you today’s proceedings live:

4.18pm: The prosecution asks Nazlan to adjourn and resume tomorrow at 9am. Nazlan agrees.

3.56pm: Thomas says Najib has to explain about the cheques he had issued – there were about 100 cheques from these two accounts.

He says it’s significant that not a single cheque had bounced, even though he earned less than RM1 million a year.

He says Najib never contacted his bank, never sued his bank or even notified them, therefore the defence must be called to let Najib answer these questions.

3.54pm: Thomas says the defence must be called as there is a need for Najib to explain why he admitted to receiving the money in his affidavit when he initiated legal action against Ling Liong Sik.

He says Najib should have gone back to the bank to say the funds had been wrongly credited into his accounts.

3.30pm: Thomas goes into Najib’s three money-laundering charges.

He is going through cases where Amla was used to prosecute offenders.

3.16pm: There is no ambiguity or doubt that the accused received the money and spent it, says Thomas.

3.08pm: Thomas says Najib had a very important role to play at every step of the transactions from KWAP to SRC International.

When SRC International was unable to repay its loans, Najib personally approved two short-term loans of RM250 million and RM300 million, totalling RM550 million, without getting government approval, for the entity to pay back KWAP, the court hears.

2.59pm: Thomas says the government guarantee for the first loan of RM2 billion by KWAP was given after the amount had entered SRC International’s accounts.

It was a record for the Malaysian government to disburse the RM2 billion to SRC International in just 12 days, he says.

2.55pm: Najib was made the “emperor” of SRC International, says Thomas, as the MNA states that he has the ultimate power to hire and fire.

“It was made absolutely clear that his word was the law.”

After the entity was formed, he says, it required a loan capital, meaning there was a need to borrow.

He says SRC International borrowed to the tune of RM2 billion, adding that nobody in the private sector would have taken such a big risk to give the entity that large of a sum.

2.54pm: Thomas also points to an instance in 2015, when Najib fired the then deputy prime minister and attorney-general.

He says Najib was very much involved in the setting up of SRC International. He says the memorandum and articles of association (MNA) for SRC International had the former prime minister’s name in it. He says this was unusual, “even Petronas didn’t have that”.

2.50pm: Thomas says Najib should have declared his personal interest and recused himself from cabinet meetings where SRC International was on the agenda, as he was adviser emeritus to the entity.

However, Najib did not do so, he says.

2.39pm: Court is in session.

Thomas addresses Nazlan on Najib’s charge under Section 23 of the MACC Act for abusing his power to gain gratification amounting to RM42 million for himself.

12.57pm: Court breaks for lunch.

12.56pm: Thomas says he will submit on the single MACC Act charge and the three Amla charges. He asks to begin after lunch.

12.55pm: Sithambaram says there is overwhelming evidence that Najib had committed CBT.

“Looking at all the evidence, (the matter) has been dealt with adequately.”

He submits that on the CBT charges, the defence should be called.

12.49pm: Sithambaram says the “Arab donations” had nothing to do with the RM42 million in Najib’s accounts, as previously claimed by the former prime minister.

12.46pm: Sithambaram argues that Najib cannot claim that he had no knowledge of the funds in his accounts because he was ready to issue cheques “at any time”, thus, he would know the amount in his accounts, “unless the accused believes that money grows on trees”.

12.37pm: The prosecution submits that Najib’s shocked reaction to the RM42 million in his accounts was merely an act.

Sithambaram says a normal person would have lodged a police report about the money, adding that the accused could have sued the bank for allowing unauthorised funds to enter his accounts.

“The accused could have hounded police to investigate. None of this was done.”

12.25pm: MACC chief Latheefa Koya is seated in the public gallery. She came unaccompanied and has been in court since 8.30am.

12.21pm: Sithambaram says there has never been any wrongful debit or credit transactions out of SRC International based on cut-and-paste e-signatures, which the defence argues were forged.

He says Najib had knowledge that millions were going out of SRC International and e-signatures are commonplace in banks.

12.18pm: Sithambaram says the money that came into SRC International was unidirectional, meaning the funds came into the entity and went out into Najib’s accounts.

He says they can only prove that RM42 million made its way into Najib’s accounts, and that other funds may be in other places.

12.15pm: Sithambaram argues that the then prime minister’s conduct was consistent with CBT.

12.07pm: On the three charges under the Anti-Money Laundering Act (Amla), Sithambaram says Najib, in his capacity as prime minister, finance minister and SRC International adviser, had dominion over the entity and committed CBT in relation to the RM42 million.

12.04pm: The prosecution begins its reply to the defence. Sithambaram says RM3.6 billion is in a bank account in Switzerland and cannot be brought back to Malaysia.

He says Najib was entrusted with control over SRC International, and abused his power by misappropriating funds.

11.53am: Court is in session. The defence has finished one part of its submissions with regard to the charge under Section 23 of the MACC Act.

Harvinderjit continues with submissions for the other charges.

11.20am: The defence is done with its submissions. Court takes a short recess.

11.17am: Harvinderjit says the amount stated on the cheques written by Najib does not tally with the funds in his personal Ambank accounts.

11.09am: Harvinderjit says the RM4 billion that came into SRC International was disbursed the same day, and that nobody can give an account of what happened to the money.

“Ultimately, the board of directors didn’t know anything with regard to the flow of the money.”

If the board did not know anything, he says, then “shadow director” Najib, too, would not have known anything about the funds, as he would have needed the board’s approval to get the money.

10.54am: Harvinderjit says the prosecution’s argument that Najib had planned to siphon off the RM42 million does not make sense as SRC International had a board of directors and went through the proper processes.

It would have been improbable for Najib to have such a plan in mind when setting up the entity, he says.

10.48am: Citing case law, Harvinderjit establishes Najib’s role as adviser to the SRC International board.

10.08am: Harvinderjit asks what exactly Najib could have disclosed. He calls the prosecution’s submissions “wishy-washy”.

He says the bottom line is that Najib had acted in national interests with the best of intentions. He says the said interests carried through in KWAP’s approval of loans, as well as in cabinet meetings.

9.59am: Farhan tells the judge that Najib would not have the intention of attending cabinet meetings with the goal of obtaining the RM42 million, pointing out that Najib received the money only two to three years later.

He says the chats between wanted financier Low Taek Jho, better known as Jho Low, and former Ambank relationship manager Joanna Yu also showed that Najib had no knowledge of the matter.

9.50am: Farhan tells the judge that they are analysing only the form of gratification received, and not the character of gratification.

9.49am: The defence submits that the RM42 million referred to in the charge under Section 23 of the MACC Act must necessarily refer to the following transactions:

(a) On December 26, 2014, RM27 million was deposited into Najib’s account ending with 880 from Ihsan Perdana Sdn Bhd (IPSB);

(b) On December 26, 2014, RM5 million was deposited into Najib’s account ending with 906 from IPSB; and,

(c) On February 10, 2015, RM10 million was deposited into Najib’s account ending with 880 from IPSB.

9.47am: Farhan talks about one charge Najib faces, under Section 23 of the Malaysian Anti-Corruption Commission Act.

He says under the charge, it must be proved that Najib is a public servant; had used his position by taking part or otherwise involving himself in cabinet meetings on August 17, 2011 and February 8, 2012, during which the cabinet resolved to grant government guarantees in respect of SRC International’s borrowings from Retirement Fund Inc (KWAP); and, corruptly intending to obtain RM42 million in gratification for himself.

9.34am: Farhan begins the defence’s submissions.

9.27am: Thomas requests that the submissions be done in two days, as agreed upon previously.

Nazlan is confident that they can be done in a day, as he has read the submissions from both sides. He expects the submissions to be done by tomorrow.

“As a general guide, 45 minutes for each side to focus on each offence,” says the judge, adding that he will pose questions along the way.

Harvinderjit and Sithambaram, who will assist in the submissions, agree.

9.26am: The SRC International trial is in session before judge Mohd Nazlan Mohd Ghazali. Former prime minister Najib Razak is seated in the dock. Present are his lawyers Muhammad Shafee Abdullah, Farhan Read and Harvinderjit Singh.

Attorney-General Tommy Thomas and ad hoc prosecutor V. Sithambaram represent the prosecution. – October 22, 2019.