Former 1MDB CEO wanted certain parts of audit report to be dropped

KUALA LUMPUR (BERNAMA) – Former Director of Audit in the National Audit Department Saadatul Nafisah Bashir Ahmad told the High Court yesterday that she was surprised that former Chief Executive Officer of 1Malaysia Development Berhad (1MDB) Arul Kanda Kandasamy asked for parts of the 1MDB final audit report to be dropped.

The seventh prosecution witness said Arul Kanda did that at a meeting in the office of former Chief Secretary to the government Tan Sri Dr Ali Hamsa on March 1, 2016 to discuss the 1MDB final audit report which was being updated.

Saadatul Nafisah said Arul Kanda wanted the opinion of the audit team to be dropped as he felt it was subjective and not supported by strong evidence.

“Mostly, it involved changing the words. At that time, the audit team was surprised with Arul Kanda as he had read and looked at every part of the report.

“Whereas the department had given the audit team a chance to voice their opinion or raise any issues at the exit conference on December 16, 2015,” she said when reading out the witness statement during examination-in-chief by Deputy Public Prosecutor Rozaliana Zakaria.

Former Prime Minister Datuk Seri Najib Tun Razak at the Kuala Lumpur High Court. PHOTO: BERNAMA

Saadatul Nafisah, who retired on May 16, 2016, was testifying on the seventh day of the trial of former Prime Minister Datuk Seri Najib Tun Razak and Arul Kanda on a charge of tampering with the 1MDB final audit report.

The witness said the exit conference was a dialogue session with the auditors after the auditing was done, where the auditors will question certain issues and ask the auditee to present supporting documents to explain the matter within a stipulated time.

Saadatul Nafisah said on the day of the exit conference, Arul Kanda brought up certain issues, including the solar project, the take-over of independent power producer companies, property, and the Segregated Portfolio Company (SPC).

“He had already given a statement and supporting documents then. But in the meeting on March 1, 2016, Arul Kanda was still instructing the auditors to take out and amend words in the 1MDB final audit report.

“However, the department did not agree with the request by Arul Kanda as after the exit conference, 1MDB had been given until the end of January 2016 for it to study and give its feedback as well as provide relevant documents, but Arul Kanda did not give any feedback until January 30, 2016,” she said.

The witness said during the time given by the department, one month after the exit conference (until January 30, 2016), 1MDB did not provide any document or information, and to the department, this meant that 1MDB agreed with the final audit report and the report which had been finalised.

Saadatul Nafisah said on February 26 and 27, 2016, Arul Kanda sent her an e-mail with several new suggestions to be included in the 1MDB final audit report, but the department ignored those suggestions.

She said among the suggestions was the 1MDB rationalisation plan which Arul Kanda had announced to the media in November 2015 which involved a joint venture between the Malaysian government and the International Petroleum Investment Company (IPIC), but he did not include any supporting documents.

“There was the issue of the top-up payment from 1MDB to IPIC but 1MDB could not confirm the actual amount that was paid and no documents were submitted to the department to support this,” she said.

Najib, 67, is charged with using his position to order amendments to the 1MDB Final Audit Report before it was tabled to the Public Accounts Committee (PAC) to prevent any action against him while Arul Kanda, 44, is charged with abetting with Najib in connection with the same offence.

They are charged with committing the offence at the Prime Minister’s Department Complex, Federal Government Administrative Centre, the Federal Territory of Putrajaya between February 22 and 26, 2016.

The charge is framed under Section 23(1) and Section 28(1) (c) which are read together with Section 23 (1) and 24(1) of the Malaysian Anti-Corruption Commission Act 2009, which provides for a prison sentence of up to 20 years and fine up to five times the amount of gratification or RM10,000, whichever is higher, upon conviction.

The trial before Judge Mohamed Zaini Mazlan continues today.