SRC board left in the dark on KWAP funds

Ismee affirms on the stand that the board was not aware of the existence of another account ending with 736 already registered with AmIslamic


SRC International Sdn Bhd’s board of directors (BoDs) were unaware of a separate company account that was alleged to have received RM2 billion in Retirement Fund Inc (KWAP) funds, ex-chairman Tan Sri Ismee Ismail (picture) said.

Defence counsel Harvinderjit Singh brought up statements from the company’s AmIslamic Bank Bhd account during the cross-examination with Ismee at the Kuala Lumpur High Court yesterday.

The account was active from Jan 28, 2011, to Aug 31, 2015.

The account, ending with number 736, showed RM2 billion being credited on Aug 29, 2011, to the former 1Malaysia Development Bhd (1MDB)-subsidiary which was then debited out on the same day.

This was done shortly after SRC International CEO and MD at the material time, Nik Faisal Ariff Kamil, wrote to KWAP earlier that month requesting to draw down the RM2 billion loan from the
pension fund, Harvinderjit pointed out.

“At the point the board signed the resolution to open up an account at AmIslamic (on Aug 23 that same year), the board was not aware of the existence of another account ending with 736 already registered with the same bank?” he asked.

Ismee, who is also former CEO for Lembaga Tabung Haji, replied in the affirmative.

“If the existence of this account wasn’t in the know- ledge of the board, it would not have been in the control of the board?” Harvinderjit asked the witness to which the latter also replied in the affirmative.

The lawyer also noted that the sum of RM15 million was credited into the account in question before it was debi-
ted out a day after. The source of the fund was claimed to come from the government’s RM20 million launching grant.

Ismee was appointed as SRC International chair in August 2011 and sat on the BoDs alongside ex-1MDB CEO Datuk Shahrol Azral Ibrahim Halmi, Datuk Che Abdullah Rashidi Che Omar, Datuk Suboh Mohd Yassin and Nik Faisal.

Based on the minutes of a board meeting dated Aug 23, 2011, the directors resolved to open a company account at AmIslamic, with Ismee and Che Abdullah among the signatories, which only became active on Nov 10 that same year.

However, court documents yesterday revealed a resolution passed on Jan 18, 2011, — 11 days after SRC International was incorporated — by the company’s directors at the time, namely Nik Faisal and Vincent Koh Beng Huat, to open an account at the same bank.

This account is the same to have allegedly received the RM2 billion KWAP loan and bore the names of Nik Faisal, Shahrol Azral and Geh Choh Heng (a former 1MDB and SRC International director) as signatories.

The role of Nik Faisal in SRC International came under further scrutiny when Ismee testified that the former was the main liaison to former Prime Minister Mohd Najib Razak for all company- related dealings.

Nik Faisal was said to have misrepresented to SRC International’s BoDs that the first RM2 billion financing agreement by KWAP hinged on the company entering into a joint venture (JV) with Aabar Investments PJS.

Harvinderjit said Nik Faisal makes no mention of a potential JV between SRC International and the Abu Dhabi’s sovereign wealth fund in his letter dated June 3, 2011, addressed to Najib when applying for the KWAP loan.

This was in spite of Nik Faisal conveying to SRC International’s BoDs that the approval of the loan was
contingent on the JV going through during a board meeting dated Aug 23 that year.

Ismee confirmed this to be the case when cross-examined by lawyer Harvinderjit. The latter also showed emails sent by Nik Faisal to KWAP officials which makes no mention of an SRC International- Aabar partnership.

The correspondence only shows Nik Faisal writing about investments in real estate projects and potential investments in six Indonesian companies.