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'Soft-spoken' Arul Kanda did not pressure auditor-general to alter 1MDB audit report, says Ali Hamsa

KUALA LUMPUR (June 16): Former chief secretary to the government Tan Sri Ali Hamsa said then 1Malaysia Development Bhd (1MDB) president and CEO Arul Kanda Kandasamy did not pressure then auditor-general Tan Sri Ambrin Buang into altering the troubled fund's audit report during a meeting in February 2016.

Ali, who was testifying at the High Court today in the audit tampering trial of former premier Datuk Seri Najib Razak and Arul, said this when asked about his use of the word “mendesak” (to urge) in his witness statement.

Ali had used the word to describe the way Arul put forward his suggestion that certain matters be omitted from the audit report, which led to Najib’s lawyer Tan Sri Muhammad Shafee Abdullah questioning the witness over what he meant by the word he used.

Shafee: What did you mean by “Arul Kanda mendesak”?

Ali: What I meant was that Arul Kanda had his opinions of the report and said that certain matters need not be included in the report. Tan Sri Ambrin agreed with the suggestion that he raised.

Shafee: We will get to that later, but what did you mean with the choice of the word mendesak?

Ali: Mendesak can be interpreted in such a way that it could either be “mendesak secara baik” (to politely request) or to put pressure. In this case, knowing his character — he talks very softly. So, it is “mendesak secara baik”.

Ali agreed with Shafee's suggestion that Arul is known for being soft-spoken and polite, and that Arul had put forward a strong case for the amendment of the audit report.

During cross-examination, Ali said then-prime minister Najib had expressed unhappiness at the draft of the National Audit Department's report on 1MDB, and said that it was requested for the department to omit that there were two differing financial statements for 1MDB for the same year.

However, Ali made it clear that there was no pressure or intimidation involved in getting the department to drop the matter from the report, as the department was given assurance that there would be a police investigation into the matter.

"There was no pressure or intimidation. It was all up to the auditor," testified Ali.

There were other matters dropped from the audit report as well, including the presence of now-fugitive businessman Jho Low at a board meeting, as well as the agreement between Country Group Securities Thailand and Acme Time Ltd, a company linked to Low.

The witness said neither himself, Arul nor anyone from the Prime Minister's Office had threatened Ambrin to amend the audit report, adding that he did not feel as though the then auditor-general was under any pressure.

Najib is charged with abusing his position to order amendments to the 1MDB final audit report to avoid any action being taken against him while Arul is charged with abetting Najib in making the amendments to the report.

Both of them were charged under Section 23(1) of the Malaysian Anti-Corruption Commission Act 2009, which provides a jail term of up to 20 years and a fine of no less than five times the amount of gratification or RM10,000, whichever is higher, upon conviction.

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