Malaysia's Ex-PM Najib Razak's biggest 1MDB trial begins
Najib faces 42 criminal charges of corruption and money laundering in connection with his misuse of the fundEuropost
Malaysian prosecutors claimed today that former Prime Minister Najib Razak abused his power to cover up the theft of hundreds of millions of dollars from the state fund 1MDB and used the fund for self-gratification.
Prosecutor Gopal Sri Ram said Najib used his position to evade justice, especially after news of the scandal broke in July 2015.
“He interfered with the course of investigation of the case which has come to be known as the 1MDB scandal,” Gopal told the Kuala Lumpur High Court in his opening statement during the biggest trial in the 1MDB financial scandal. “He took active steps to effect a cover-up of his criminal acts.”
The prosecution also argued that Najib had not acted alone, colluding on numerous occasions with fugitive financier Low Taek Jho, better known as Jho Low, to set up and carry out abnormal financial transactions “with undue haste”. According to Gopal, Najib and Low had colluded to raise more than $5bn to fund the acquisition of two energy companies, though part of the sum went to accounts linked to Low while Najib was paid more than 90m ringgit ($21.48m).
The funds raised include two $1.75-billion bond issuances arranged by Goldman Sachs, which netted the bank a total payout of $302.5m in arranger’s fees. Goldman earned another $279m as arranger of a $3-billion loan to fund a “sham” joint-venture project between 1MDB and Aabar Investments PJS to build the Tun Razak Exchange tower. Gopal said Najib ultimately received $681m from the deal.
As Europost reminds, Malaysian and US authorities have alleged that about $4.5bn was misappropriated from 1Malaysia Development Berhad (1MDB), co-founded by Najib in 2009. Najib was then voted out of power last year amid widespread public anger over the scandal, and has since been charged with 42 criminal offences linked to losses at 1MDB and other state entities. He has denied any wrongdoing and says the charges against him are politically motivated.
In his second trial on Wednesday, Najib faces 21 charges of money laundering and four charges of abuse of power for allegedly receiving illegal transfers of at least 2.3bn ringgit ($550.8m) between 2011 and 2014.
Wednesday’s proceedings began a day after the prosecution wrapped up its case in Najib’s first trial, where he is accused of illegally receiving $10m from SRC International, a former 1MDB unit. Lawyers are expected to submit closing arguments in that case in October, with the judge to rule by 11 November.