KUALA LUMPUR: Datuk Seri Najib Razak returned to court today to defend himself in another civil proceeding, just weeks after being found guilty of misappropriating RM2.3 billion in 1Malaysia Development Bhd (1MDB) funds.
The former prime minister took the witness stand as a defendant in SRC International Bhd’s RM42 million civil suit, filed in 2021, which alleges that Najib breached trust, abused his power and personally benefited from the company’s funds.
While testifying, Najib denied exercising control over SRC International or acting as a “shadow director”, telling Judge Datuk Raja Ahmad Mohzanuddin Shah Raja Mohzan that the company’s board and management were solely responsible for its operations and use of funds.
The former Pekan MP said the plaintiffs had wrongly personalised institutional and shareholder-level decisions, collapsing them into alleged day-to-day corporate control.
Najib said he never attended board meetings or managed the company’s operations, adding that any approvals or consents given by him were at shareholder level through the Ministry of Finance Incorporated.
“I did not occupy the position of director, de jure or de facto; I did not act as a shadow director; and I did not cause the board to be ‘accustomed’ to act on my instructions. My involvement was confined to the public-interest responsibilities of my offices and the limited shareholder functions that the law requires — nothing more. Ultimately, I am advised that the legal test requires a course of conduct showing the board was accustomed to act on my instructions. There is no such pattern,” he said.
Najib added that SRC International was conceived as part of the national energy-security policy under the 10th Malaysia Plan, following a proposal by 1MDB in 2010.
The Economic Planning Unit (EPU), he said, conducted a feasibility study, rejected a proposed RM3 billion government grant, approved only a RM20 million launch grant, and recommended that SRC International seek commercial financing instead.
He said the company subsequently secured RM4 billion in loans from Kumpulan Wang Persaraan (Diperbadankan) (KWAP) in two tranches, backed by government guarantees, with approval obtained through institutional processes involving the KWAP Investment Panel and the cabinet.
Najib also denied involvement in SRC’s incorporation, the drafting of its memorandum and articles of association, or the early appointment of Nik Faisal Ariff Kamil and Vincent Koh as initial directors and shareholders.
He said provisions in SRC International’s constitution requiring prime ministerial approval for certain matters were standard shareholder safeguards found in other government-linked companies and did not confer absolute control or unilateral power to appoint or remove directors.
He further rejected claims that Nik Faisal acted as a conduit for his instructions, saying any representation that decisions came from him would have been unauthorised and contrary to proper corporate governance.
Regarding the alleged misappropriation of funds, Najib said he had no knowledge of, nor gave instructions for, SRC International money to be channelled to Ihsan Perdana Sdn Bhd or for any funds to be routed to him.
He maintained that he believed monies credited into his personal accounts were donations, as had occurred previously, and that he did not personally manage those accounts or receive monthly bank statements.
Najib added that he was unaware at the time that any funds were allegedly traceable to SRC International and would have rejected or returned them immediately had he been informed.
The hearing continues.
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