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SRC ran like government dept, Najib had full control, says Suboh

19 Jun 2024, 18:14 PM SGT

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KUALA LUMPUR (June 19): Despite being a private company, SRC International Sdn Bhd was run akin to any government department under former prime minister Datuk Seri Najib Razak, the High Court heard on Wednesday.

Former company director Datuk Suboh Md Yassin said that Najib had "full and absolute control" over all aspects of running the company, so much so that Suboh, who retired from the civil service in 2009 after 35 years of service, felt that his experience as a non-executive board member in SRC was no different from that of a government employee.

"One must understand that even though SRC is a private limited company (Sdn Bhd), the way SRC was run — its corporate governance, setup, [objectives], and operation — were in effect and in reality, an extension of governmental activities of the Ministry of Finance (MOF).

"The running of SRC felt just like any other government department under the direction of [Najib], the Prime Minister and Minister of Finance at that material time. [Najib] had full and absolute control over all aspects of the running of SRC, to the exclusion of the board," the 73-year-old testified.

Datuk Seri Najib Razak appearing at the High Court for the SRC International Sdn Bhd trial on Wednesday. (Photo by Zahid Izzani/The Edge)

He added that as civil servants, they were used to and were expected to follow directions from "the top".   

"If the top required us to do something, we were not in any position to object to or to override any decision that we were instructed to implement, and [we were expected] to take all necessary steps to give effect to the underlying transactions of these instructions," he said.

Suboh added that this was further compounded by the fact that Najib had the power to "hire and fire" any SRC director as stated in the company Memorandum and Articles of Association.

However, during cross-examination by defence counsel Farhan Shafee, Suboh said that then SRC chief executive officer Nik Faisal Ariff Kamil was the contact person between the board and Najib, and as such, it could be "entirely possible" that the fear that Najib could "hire and fire" board members was propagated by Nik Faisal. 

"In running the company, the contact point for us is Nik Faisal. He is the one who [is our connection] with Najib. None of us know anything, we were denied any information," Suboh testified. 

'SRC had a peculiar set-up'

Suboh, who appeared physically frail and walked with the assistance of a cane, also testified that the SRC had a peculiar set-up where aspects of running the company went through Najib.

"SRC had a peculiar set-up. What I experienced as a director of SRC was completely something else. All aspects of the running of SRC were controlled by [Najib], either directly by himself, or through his proxy and representative, Nik Faisal," Suboh said.

He added that all major investments and strategic decisions involving the company were referred to Najib, in his capacity as the Advisor Emeritus, for his approval.

This set-up compelled the board to follow Najib's directions, often communicated through various shareholder minutes as the sole shareholder (of SRC), through MOF Inc, or through Nik Faisal's directions, "said to be expressed on behalf" of the PM.

Suboh is testifying in the on-going civil action by SRC against Najib and Nik Faisal. The court had previously delivered a judgement in default against Nik Faisal, who is currently at large. Suboh is testifying as a third party and also SRC's witness. 

'Boss nak lah'

Suboh also testified that Nik Faisal would only approach him whenever the CEO needed Suboh's signature on documents.

Suboh testified that initially, he would query what were the purpose of the documents he was to sign, but these questions would be brushed aside by Nik Faisal as something that had to be done on Najib's behest, saying “boss nak lah” or “diminta pihak atas” [requested by superiors].

Eventually, Nik Faisal relegated these duties to a runner, where Suboh would sign these documents on the spot.

"Most of the time, the document to be signed by me would already have been signed by Nik Faisal. I was required merely to countersign. This 'rubber-stamping' process went on throughout my tenure in SRC," he said.

Suboh was in SRC from August 2011 until March 2019.

During cross-examination, Suboh also agreed with Farhan that he was appointed to the board through merit and his experience.

The defence counsel is set to continue his cross-examination when the trial resumes on Thursday. 

This civil case revolves around a RM4 billion KWAP loan which was given in two tranches in the second half of 2011 and first half of 2012 to SRC. This is separate from the SRC criminal case for which Najib is imprisoned.

SRC filed the RM4 billion suit against Najib and Nik Faisal in May 2021. Initially, the suit also named former company board members Tan Sri Ismee Ismail, Datuk Mohammed Azhar Osman Khairuddin, Datuk Shahrol Azral Ibrahim Halmi, Suboh, and Datuk Che Abdullah @ Rashidi Che Omar as defendants.

They were dropped later, only for Najib to bring them back again as third parties. A defendant can initiate this against a third party who is not part of the main suit, in order to claim contribution, indemnity, or any remedy which is claimed by the plaintiff.  

SRC claims that out of the total KWAP loan of RM4 billion, a sum of RM3.6 billion was immediately transferred out when the funds came into SRC, of which a sum of US$120 million had eventually ended up in Najib’s bank account.

Edited ByAniza Damis

Source: https://theedgemalaysia.com