Najib Must Answer For Rm24b Settlement With Ipic

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QUESTION TIME | Attorney-general Tommy Thomas’ statement on Tuesday on the efforts to recoup US$5.78 billion, or a massive RM24 billion at current exchange rates, paid or to be paid by failed 1MDB to an Abu Dhabi state investment company raises many questions
If the former finance minister and former prime minister Najib Abdul Razak, who signed the settlement agreements together with former Treasury secretary-general Irwan Serigar, wants to shed some real light on the issue, then he has to address some serious questions
But first, let’s look at what Thomas is doing here. There is a settlement agreement between International Petroleum Investment Company (IPIC - wholly owned by the Abu Dhabi government), IPIC subsidiary Aabar PJS, 1MDB and Minister of Finance Inc
The Malaysian government will apply to the English Courts to set aside the May 9, 2017 agreement via arbitration in London
Under the settlement, Malaysia is obliged to pay US$5.78 billion to IPIC and the bond trustee over a five-year period. So far, US$1.46 billion has been paid, leaving a balance of US$4.32 billion, with the next interest payment of US$50 million due on Nov 11 this year
“The basis of Malaysia’s legal challenge in the High Court in London is that the consent award was procured by fraud or in a manner contrary to public policy,” Thomas (photo) said
“The court application relates to the knowledge of IPIC and Aabar of the serious allegations made by the United States Department of Justice (DOJ) against former Prime Minister and Finance Minister Najib Razak, who was also the moving spirit and ultimate decision maker in 1MDB
“Such knowledge on their part was acquired, ‘inter alia’, no later than the time when the DOJ’s Press Conference was held by the Attorney General of the United States, Loretta Lynch, in July 2016 when she announced the filing by DOJ of several civil suits for the freezing of assets purchased by fraudsters from stolen proceeds, and popularly described as the greatest kleptocracy in modern history
“…Malaysia takes the position that IPIC and Aabar were aware of the fraud of Najib Razak. He was principally responsible for 1MDB and Minister of Finance Inc consenting to the award
“Every system of law would hold that he could not possibly have acted in the best interests of his country and his company. Indeed, he did not. Fraud is an established ground to challenge the consent award for public policy reasons
“We are pleased to report that the application will be filed today (Tuesday) in the High Court in London. Malaysia will claim that as a result of the fraud, we are relieved from any obligation to pay the balance of the US$4.32 billion to IPIC or Aabar under the consent award, and additionally have a right to recover the US$1.46 billion already paid,” Thomas said
That’s as clear as it can be. Najib has publicly stated that the full settlement agreement needs to be made public and he acted according to the interests of the country - but is that really the case? So far, details of the settlement have been rather sketchy
Based on IPIC’s filings to the London Stock Exchange, on which some of its bonds are listed, this is what IPIC said about the settlement:“Under the terms of the Settlement, IPIC will receive an amount of US$602,725,000 by 31 July 2017 and a further amount of US$602,725,000 by 31 December 2017
“Separately, 1MDB and MoF Inc, undertake to IPIC to assume responsibility for all future interest and principal payments under the two bonds issued by 1MDB Group companies that are guaranteed by 1MDB and IPIC; (i) US$1,750,000,000 fixed rate 5.75 percent notes due 2022 issued by 1MDB Energy (Langat) Limited and (ii) US$1,750,000,000 fixed rate 5.99 percent notes due 2022 issued by 1MDB Energy Limited
“The parties have provided suitable undertakings and indemnities in respect of the performance of obligations under the Settlement. The parties have also agreed to enter into good faith discussions in relation to payments made by 1MDB Group to certain entities.”It looks like the total sum of RM5.78 billion involves repayment of two bonds totalling US$3.5 billion and all interest payments involved up to when the notes are due in 2022
Transactions detailed in DOJ reportsAccording to the DOJ reports, US$1.367 billion were stolen from the US$3.5 billion in bonds, of which US$238 million went to Najib’s stepson Riza Aziz, and US$30 million to Najib himself
Also, two key Aabar PJS officials received substantial amounts
They were Khadam Abdullah al-Qubaisi (photo), the then managing director of IPIC and chairperson of Aabar PJS, who received US$473 million; and the then CEO of Aabar PJS Mohamed Ahmed Badawy, who got US$66.6 million
This was done by a transfer to a dummy company incorporated in the British Virgin Islands which had the same “Aabar PJS” name and whose directors were Qubaisi and Husseiny, implying complicity by these top-ranking officials of both IPIC and Aabar PJS in the robbery. (Details of these and other transactions are in my book 1MDB The Scandal that Brought Down a Government.)Najib needs to explain at least the following:Why did he make such a lopsided arrangement with IPIC and Aabar PJS when their own officials were so complicit in the crime?Did he inform the cabinet and get approval for this?Did he get advice from the attorney-general, and what was it? Did he provide written advice? If he did not, why not? Is Najib an expert on legal matters?Who advised him to agree to this settlement? Was there a panel of lawyers, accountants and financial experts? If not, why not, especially when it involved RM24 billion?Did he take advice from other government officials such as the auditor-general and the accountant-general? If not, why not?Najib has said that this was in the interest of the country. How so?Is it an attempt to cover the misdeeds at 1MDB because it certainly seems to be so? Otherwise, how do you explain such sloppiness?For all his bravado, Najib has little solid explanation for the allegations and charges that have been made against him with respect to 1MDB
His reply at the recent Al Jazeera interview that he thought that the US$680 million donation was from Saudi Arabia rings terribly hollow and trite as any reasonable person will immediately ascertain where exactly such a huge amount of money came from
READ MORE: 'Stolen' 1MDB funds: DOJ lawsuit revisitedP GUNASEGARAM says false pride and arrogance always goeth before a fall. Email: [email protected]. -Mkini

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