A FORMER treasury official told the High Court that a letter of support (LOS) issued by the government to enable 1MDB Global Investment Ltd to secure a US$3 billion bond was done in haste.

Former finance ministry deputy secretary general Siti Zauyah Mohd Desa said that in her 25 years’ experience with the ministry the LOS was an abnormal transaction. 

“It was the first of its kind, everything needed to be done speedily on the same day (preparing the LOS),” she said.

Zauyah was being cross examined by ad hoc prosecutor Gopal Sri Ram on the LOS. 

Sri Ram then asked her, if as her result of the speed (to prepare the letter) was the usual cautionary steps taken. 

Zauyah said no proper action was taken. 

“There was no due diligence done on the project cash flow and its impact for us to assess if it could churn out sufficient returns to service the loan.”

“On the same day we had to prepare a (proposal) paper to be presented to the cabinet. There was no thorough assessment done on the investment.”

1MDB Global Investment Ltd, a subsidiary of 1MDB, wanted to obtain a US$3billion (RM12.5 billion) bond in 2013 but the principal banker, Goldman Sachs, had suggested to the company that they obtain a LOS from the Finance Ministry.

This money was needed to develop the Tun Razak Exchange (TRX) project on a joint venture basis with Aabar Investment PJS.

The support letter was issued after 1MDB directors had agreed in writing to raise US$3 billion (RM12.5 billion) in funds through a bond issuance.

Zayuah who is the 26th prosecution witness said that the information given (to prepare paper) was not enough to work with.

Sri Ram then asked why she did not approach the then prime minister on these matters. 

Zauyah said that she approached the then former finance minister Ahmad Husni Hanadzlah but he did not want to get involved.

“I can’t bypass my bosses to go to the PM. It is not the practice for an officer to go directly to the PM.”

“I don’t have direct access to the PM.”

Sri Ram asked Zauyah if Irwan Serigar Abdullah was the treasury secretary-general at the time of this transaction to which she agreed. 

When asked if it was an option for her to defy Irwan’s instructions, she said that she could only advise him.

“It would be up to him to accept the advice. He did tell me this is urgent. It is from the PM you have to do it,” she said. 

Sri Ram then asked how she felt about the issue (Irwan’s instruction).

“It was an instruction,” she says. – September 27, 2022.