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PetroSaudi co-founder received US$85m from 1MDB JV deal, High Court told

KUALA LUMPUR (Oct 30): PetroSaudi International Ltd (PSI) chief executive and co-founder Tarek Obaid received an US$85 million (about RM356 million) commission as a result of the company's joint venture (JV) deal with 1Malaysia Development Bhd (1MDB).

This was revealed at the High Court here today during former 1MDB chief executive officer Datuk Shahrol Azral Ibrahim Halmi's cross-examination.

Shahrol (pictured) is the prosecution's ninth witness for the 1MDB-Tanore trial involving former prime minister Datuk Seri Najib Razak.

Najib faces power abuse and money laundering charges involving 1MDB funds. Najib's lawyer Tan Sri Muhammad Shafee Abdullah cross-examined Shahrol before Justice Collin Lawrence Sequerah.

During the cross-examination, Shafee went through various bank statements which showed that Good Star Ltd, a company linked to Low Taek Jho, had made the US$85 million payment to Tarek. Low is popularly known as Jho Low.

It was revealed that 1MDB had been duped into thinking that Good Star is a subsidiary of PSI.

Shafee: Remember US$700 million went out to Good Star. Here US$85 million is credited into this account. Were you aware that Obaid received this US$85 million?

Shahrol: I wasn't aware.

Shafee brought to Shahrol's attention the bank statement which included comments on the US$85 million transaction. "Expected inflow for new client — commission received by client for JV deal".

Shafee: That's interesting, isn't it? Now that you know this. Do you know what sort of commission one can make in a JV deal? Can this be a bona fide commission? Or is this outright stealing?

Shahrol: I don't have enough information to determine.

Later, Shafee revealed other payment transactions, which include one that indicated a total of US$33 million from the US$85 million was paid to PSI executive Patrick Mahoney.

Shafee also revealed a payment to law firm White & Case LLP, which represented the 1MDB-PetroSaudi JV company. Referring to the receipt, the lawyer said Tarek paid about £127,015 to White & Case.

Shafee: Isn't it strange that the payment was made by Tarek?

Shahrol: Yes, the payment should have come from the company — either PSI or PetroSaudi Cayman (subsidiary).

Shafee: But the fact that it came from Tarek, does that tell you something?

Shahrol: Without more info, I can't ascertain.

Shafee: But now, is it possible to say Tarek paid White & Case for the legal services because he had a personal interest.

Shahrol: It is possible.

The hearing continues tomorrow afternoon.

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