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1MDB board of directors didn't know of US$700m loan agreement, court told

KUALA LUMPUR (Oct 21): The High Court here today was told that the 1Malaysia Development Bhd (1MDB) board of directors (BoD) did not know about the US$700 million loan agreement signed by the 1MDB-PetroSaudi International Ltd joint ventur (JV) company in 2009, prior to the actual joint venture agreement between both sovereign wealth funds.

Former 1MDB chief executive officer Datuk Shahrol Azral Ibrahim Halmi, 49, who disclosed the matter, however, said he was not involved in the discussions of the particular loan agreement deal.

He was cross-examined by Datuk Seri Najib Abdul Razak’s lawyer Tan Sri Muhammad Shafee Abdullah, on the 25th day of the former premier's 1MDB trial.

Muhammad Shafee: The board never knew of this agreement entered into on Sept 29, 2009, prior to the JV agreement?

Shahrol Azral: Correct.

Muhammad Shafee: If this loan agreement had been presented to the board, they would not have agreed to the terms?

Shahorl Azral replied, "I would agree with that".

When asked why he did not check the matter with Najib, the ninth prosecution witness said the whole thing was managed by 1MDB executive director Casey Tang and he assumed Tang, with his superior experience, would ensure everything was in order.

To another question, the witness agreed that he has never actually seen the loan agreement during his tenure at 1MDB from 2009 until 2016.

"I was shown this document (agreement) during the investigation, I can’t remember whether I saw it in 2009," he added.

Najib, 66, faces four charges for using his position to obtain bribes totalling RM2.3 billion from 1MDB funds and 21 charges of money laundering involving the same amount.

Hearing before Judge Collin Lawrence Sequerah continues on Thursday.

The Edge is reporting the proceedings of the 1MDB-Tanore trial live.

Users of The Edge Markets app may tap here to access the live report.

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