KUALA LUMPUR: Datuk Seri Najib Tun Razak told the High Court here today that he did not order the removal of KPMG as 1Malaysia Development Berhad’s (1MDB) auditor, asserting instead that the decision to replace the firm was made by the 1MDB Board of Directors.
Testifying as the first defence witness in his trial for allegedly misappropriating RM2.3 billion in 1MDB funds, Najib said he disagreed with the prosecution’s contention regarding the removal of KPMG, as he had given clear direction to both 1MDB and KPMG to take the necessary steps to finalise the accounts by Dec 31, 2013.
Najib said the meeting with KPMG was held on Dec 12, 2013 at his residence in Langgak Duta, and KPMG was represented by its managing partner Datuk Johan Idris, with the attendance of 1MDB Board of Directors chairman Tan Sri Lodin Wok Kamaruddin, Mohd Hazem Abd Rahman (former 1MDB chief executive officer) and Azmi Tahir (former 1MDB chief financial officer).
“To the 1MDB management, I had instructed them to assist and speak to Bridge Global Partners to obtain the necessary information and documents for KPMG to enable the company’s auditors to complete the audit.
“For KPMG, I even went to the extent of requesting KPMG to fly to Hong Kong to get the necessary comfort to complete the audit. I remember distinctly reminding all parties, 1MDB and KPMG alike, during the meeting to exercise good governance in their conduct in the matter,“ he said when reading the second volume of his 525-page witness statement.
Najib said he did not have any record of what had been said in the meeting but he believed that during the course of this trial, Johan, who was the 14th prosecution witness, did refer to minutes of the same meeting which he prepared.
The former prime minister also denied the prosecution’s assertion that he pressured the 1MDB Board of Directors to remove KPMG as the company’s auditors, stating that he recalled being presented with a letter outlining the reasons for KPMG’s removal, along with the Special Notice under Section 153 and Section 172(4) of the Companies Act 1965.
“However, I could not have prepared the Special Notice according to the provisions of the Companies Act 1965 on my own. The prepared draft would have to come from 1MDB.
“That allegation is preposterous because there was a letter by 1MDB explaining the justification for the removal of KPMG and the appointment of Deloitte KassimChan to replace KPMG as the company’s auditor,“ he said.
Najib said he also recalled during this trial that the 1MDB Board of Directors had passed a Director Circular’s Resolution (DCR) for the removal of KPMG and the same DCR also explicitly stated that the appointment of another auditing firm, Deloitte KassimChan, was recommended by the Audit & Risk Management Committee of the Board.
Today marks the eighth day the former Pekan MP has taken the stand to defend himself against four charges of using his position to obtain RM2.3 billion of 1MDB funds in bribes and 21 charges of money laundering involving the same amount.
On Oct 30, Justice Datuk Collin Lawrence Sequerah ordered Najib to enter his defence on all 25 charges, ruling that the prosecution had established a prima facie case against him at the end of its case.
The trial resumes on Thursday (Dec 12).
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