1MDB admitted no money, no investments after RM15 million fine, Zeti says

Former Bank Negara Malaysia (BNM) governor Zeti Akhtar Aziz told the Kuala Lumpur High Court yesterday that 1MDB had admitted that there was no money and no investments after the central bank imposed a fine of RM15 million against it.

Zeti, 76, said the inability of 1MDB to bring the money back and to provide evidence on the status of the funds resulted in a compound being imposed on the sovereign wealth fund.

According to the 46th prosecution witness, 1MDB paid the compound on May 25, 2016.

Zeti said this when questioned by Najib Razak’s lead counsel Muhammad Shafee Abdullah at the former prime minister's trial on the misappropriation of RM2.3 billion in 1MDB funds.

Shafee: Did 1MDB repatriate any funds?
 
Zeti: None. They (1MDB) informed us that the money was placed overseas to pay debt, and we (BNM) said we can accept it, if they provide sufficient documents as well as where the funds were placed. But 1MDB was unable to provide the details as there were none. 1MDB admitted no money and no investments.

Zeti also told the court that 1MDB had in 2014 filed an application to BNM, seeking permission to borrow funds from offshore sources of around RM4.9 billion. 

"We rejected this application because of their high level of debt. They (1MDB) were not happy and filed an appeal. However, that appeal was also rejected," she said.

When Shafee asked if 1MDB attempted to raise an appeal with the finance ministry helmed by Najib at the time regarding the RM4.9 billion loan, Zeti said she was not aware.

Shafee: Did Najib contact BNM and ask it to review this decision (rejection)?

Zeti: No

Najib, 70, faces four charges of using his position to obtain bribes amounting to RM2.3 billion belonging to 1MDB and 21 charges of money laundering involving the same amount.

The trial before judge Collin Lawrence Sequerah continues today.