THE prosecution’s ninth witness, former 1Malaysia Development Berhad (1MDB) CEO Shahrol Azral Ibrahim Halmi, returns to the stand as former prime minister Najib Razak’s trial enters its 27th day today.

Lead defence counsel Muhammad Shafee Abdullah will cross-examine Shahrol during the trial at the Kuala Lumpur High Court.

Last Thursday, Shahrol testified that pressured by Najib, through intermediaries, he closed the 1MDB and PetroSaudi International deal in September 2009.

He said he was told to do so by fugitive businessman Low Taek Jho, commonly known as Jho Low, and 1MDB’s then executive director Casey Tang, despite issues such as a clause would result in a US$700 million (RM2.9 billion) debt for the entity.

“At the time, I was under a lot of pressure to get the deal signed. Low and Tang both assured me that it was okay, and Low reiterated that the boss (Najib) really wanted to get this done.

“So, I made the decision to go with what I perceived to be instructions from Najib, and signed the agreement. I trusted that it would work out because Low was working out the details with Tang, with Najib’s full knowledge.”

Najib, 66, is on trial for four counts of power abuse to enrich himself with RM2.3 billion from 1MDB and 21 counts of laundering the same amount.

He faces four charges of using his position to obtain bribes totalling RM2.3 billion from 1MDB and 21 charges of laundering the same amount.

Prosecutors have accused him of conspiring with the Penang-born Low to defraud the state investor.

Shahrol, 49, also told the court that 1MDB performed due diligence only as far as doing an internet search in 2009 to verify the assets of its joint venture partner PetroSaudi International.

It was Tang’s team that handled the verification of PetroSaudi’s alleged US$2.2 billion (RM9.2 billion) oil and gas properties in Argentina and Turkmenistan, he said.

Najib is represented by a dozen lawyers led by Muhammad Shafee Abdullah.

Former Federal Court judge Gopal Sri Ram leads the prosecution before judge Collin Lawrence Sequerah.

The Malaysian Insight brings you today’s proceedings live:

4.40pm: Shafee calls time on the cross examination for today as he wants to go into the misappropriation of the US$700 million tomorrow. Court is adjourned till tomorrow morning.

4.22pm: Shafee says Edward Morse, who conducted the first and only valuation, was in cahoots with PSI to give 1MDB a fictitious report. 

Shafee: I would like to question Edward Morse if he’s here one day.

4.10pm: Shahrol says the board did not trust PSI and asked for a second evaluation but was discouraged from doing so by PSI because they claimed that it would cost a lot of money.

Shahrol says he realised in hindsight that PSI did not want the second valuation because it would have uncovered the truth about their assets.

3.30pm: Sri Ram objects to Shafee’s line of questioning as the case does not deal with company law.

Shafee says he had to ask because he wanted to know how Shahrol made his decisions. Judge Sequerah allows it for the time being.

3.25pm: Shafee asks Shahrol if he had a fiduciary duty to Najib and to 1MDB through the former prime minister. 

Shahrol: Yes, I do.

Shafee: Can you show me any documentation that says that? 

Shahrol: No I can’t, but I was and top management were appointed by Najib.

Shafee: You are aware that your fiduciary duty is to the company and not to the shareholder by law?

Shahrol: Can I see it? (The law)

Shafee: I’ll show you later. Answer the question, are you aware that your fiduciary duty was to the company?

Shahrol: I didn’t know this.

Shafee: The finance minister is a shareholder of 1MDB, can you show me any document that says you owe fiduciary duty to the board of advisors or the chairman of the board of directors. You did not understand the basic principles of company law, you messed up your role. 

Shahrol: Perhaps I did not know the law and followed Najib.

Shafee: Did Najib ever say “listen to me and not to the board”? 

Shahrol: No, he did not.

3pm: Court resumes after a lunch break.

12.25pm: Shafee: You surely agree with me that Najib had nothing to do with this sham agreement? 

Shahrol: I can’t say what he knew.

Shafee: You agree with me that if you were duped, he (Low) may have duped najib? 

Shahrol: Yes, I agree.

Shafee: You agree with me that if the clock strikes 13, you have to check the clock? That Casey, Low and others were untruthful? 

Shahrol: It’s hard to say if they were entirely untruthful.

Shafee: If you could go back in time, would you trust them? 

Shahrol: If I could go back in time, I would have quit the job.

Shahrol also tells Shafee he believed that Najib wanted to do good with 1MDB and that’s why he served Najib.

12.18pm: The US$700 million was to be transferred to a bank account belonging to Good Star Ltd, this being RBS Coutts Bank AG (Zurich) with the bank account number 11116073. Shahrol says he didn’t know Good Star belonged to Low.

Shahrol says the deal was a sham as he had not heard of Good Star before.

12.10pm: Shafee suggests to Shahrol that, in retrospect, Low was a “total liar” and his credibility is in question. Shahrol agrees.

11.30am: Court resumes. Shahrol is verifying the account that the US$700 million was transferred to.

10.48am: Court takes a short break.

10.21am: Shahrol says he was satisfied that Casey Tang and Jho Low had contravened a board decision to split the Petro Saudi International funds of US$1 billion to US$700 million and US$300 million.

Shahrol says he felt that this should have been done. Tang then informed him to do it first and tell the board later. Shahrol says there was a need to get it done because he was rushed.

Shafee: How long would it take to call the board?

Shahrol: Not long, but Casey told me we will explain to the board later.

Shafee: So, Casey said never mind, the board made a decision but we will just make another.

Shahrol: It seemed that it was a good deal and it got the blessings of Najib and Jho Low.

9.57am: Shafee is going through the loan agreement from 1MDB to PSI to the tune of US$700 million. Shahrol agrees that Tarek Obaid was one of the signatories on the agreement.

9.54am: Court is in session, Shafee begins his cross-examination of Shahrol. – October 29, 2019.