Najib Had Faith In SRC Board, No Inquiry Over Additional RM2 Bln Loan Request, Court Heard

KUALA LUMPUR, Oct 17 (Bernama) -- Former Prime Minister Datuk Seri Najib Tun Razak told the High Court here today that he did not enquire about the RM2 billion additional loan request from SRC International Sdn Bhd (SRC) because he had faith in its board of directors (BOD) to play their role in making responsible decisions in the best interest of the company.

The company had applied for additional funding, despite a lack of concrete developments from its first Retirement Fund Inc (KWAP) RM2 billion loan, which was government-guaranteed.

Najib, 71, said that he had discussed with SRC’s management about the "imminent investments" in the energy field, and it was the responsibility of (then) SRC chief executive officer Nik Faisal Ariff Kamil to deal with the board.

Under cross-examination by SRC's counsel P. Gananathan, Najib said he was aware there would be a formal process before the second loan application could be approved by KWAP, and it was Nik Faisal’s responsibility to liaise with the BOD on the issue.

Gananathan: All you did was agree with Nik Faisal's proposal for additional funding and forward it to the Economic Planning Unit (EPU)? You asked no questions as Finance Minister, you asked no additional questions?

Najib : It is for Nik Faisal to deal with the BOD. I had faith in the BOD all along. 

Gananathan : The BOD that you did not revert to?

Najib : It's not for me to deal with the BOD,  that is the management's duty. 

Najib was testifying as the first defendant witness in SRC International’s USD1.18 billion civil suit against him and Nik Faisal, who is still at large. 

Gananathan further questioned Najib's testimony, implying that the board of directors still needed Najib's approval in the form of his signatures to move forward with their investment plans.

Gananathan: Regardless of whatever it is said to you by the BOD or by the management, the utilisation of these funds would not have been carried out without your signature and approval.

Najib: I disagree.

In May 2021, under the new management, SRC filed the lawsuit, accusing Najib of breach of trust, abuse of power, personally benefiting from the company’s funds and misappropriating the said funds.

SRC International previously removed five of its directors from the lawsuit, retaining Najib as the sole defendant. However, the High Court permitted Najib to issue third-party notices against them.

The company is seeking a court declaration holding Najib accountable for the company's losses due to his alleged breach of duties and trust and for him to compensate the RM42 million in losses they have incurred. 

The trial before Judge Datuk Ahmad Fairuz Zainol Abidin continues tomorrow.

-- BERNAMA