Tuesday, December 10

Najib did not declare conflict of interest — 40th witness


Mazidah Abdul Majid

KUALA LUMPUR: There was no declaration of conflict of interest by Datuk Seri Najib Tun Razak when he chaired a Cabinet meeting related to SRC International Sdn Bhd in February 2012, according to the 40th prosecution witness in the former premier’s trial yesterday.

Cabinet former deputy secretary-general (Constitution and Communication) Tan Sri Mazidah Abdul Majid based her testimony on the minutes of a Cabinet meeting to discuss a memorandum on the government’s guarantee of up to RM2 billion for a loan applied by SRC International.

She also said none of the ministers requested the prime minister to leave during or prior to the discussion on the memorandum.

Mazidah said the cabinet meeting (minutes) was dated Feb 8, 2012.

Najib was then Adviser Emeritus of SRC.

She recalled that Najib did leave the meeting on Nov 23, 2012 when the cabinet proceeded to discuss a memorandum regarding CIMB Bank Berhad.

At the time, the accused’s brother Datuk Seri Nazir was CIMB Group Holdings Bhd chairman.

The witness said it was the practice of ministers to declare conflict of interest and leave the meeting if they had some involvement in any matter discussed by the cabinet.

“This would be recorded in the minutes. The time when the minister rejoins the meeting is also recorded in the minutes,” Mazidah said, reading out her witness statement on the 27th day of the trial.

To a question from deputy public prosecutor Muhammad Izzat Fauzan whether the practice by cabinet members to declare conflict of interest was provided for in the Code of Ethics for Members of Administration and Members of Parliament, she replied, “ yes”.

“In 1997 or 1998 the Cabinet approved the Code of Ethics for administration members and in the code of ethics it is requested that when you have conflict of interest in the matter that was being discussed, you have to leave the meeting and it must be recorded in the minutes of meeting,” Mazidah added.

According to the witness, the SRC memorandum which was received from the Finance ministry was deliberated in two cabinet meetings chaired by Najib on Aug 17, 2011 and Feb 8, 2012.

She said the memorandum was recommended to the cabinet for government consideration and approval of a guarantee to SRC International Sdn Bhd for a RM2 billion loan from a domestic financial institution.

SRC was a subsidiary of 1Malaysia Development Berhad, a wholly owned company of Minister of Finance Incorporated.

Mazidah said the loan, with a repayment period of up to 10 years was to fund investment activities in natural resources.

The guarantee was consistent with the Loan Guarantee (Bodies Corporate) Act 1965.

“The guarantee covers repayment of the loan plus interest so that SRC would be given tax and stamp duty exemption as provided for under Section 10 of the Loan Guarantee (Bodied Corporate) 1965,” she said.

She said the guarantee would also give the finance minister authority to dictate the terms and conditions on the loan.

Najib, 66, is facing three criminal breach of trust charges, one power abuse charge and three money laundering charges involving SRC International’s funds totalling RM42 million. — Bernama