Najib never said 'okay' to KPMG signing-off 2013 1MDB financial statement, says witness

KUALA LUMPUR - The High Court was told today that Datuk Seri Najib Razak had never given the "okay” to KPMG Malaysia to sign off the 2013 1Malaysia Development Berhad (1MDB) financial statement after a meeting between the audit firm and 1MDB at the former premier’s residence in Langgak Duta on Dec 15, 2013.

Former 1MDB chief financial officer (CFO) Azmi Tahir, 48, in reply to a question posed by Najib’s counsel Wan Aizuddin Wan Mohammed, said that the word "okay” never came from Najib.

Azmi explained that the meeting was held upon the request of KPMG as the audit firm was adamant on meeting Najib, as it was unhappy with information and documentation provided by 1MDB’s management for the purpose of auditing the Malaysian sovereign wealth fund’s US$2.3 billion overseas investment.

The witness said that he had received a phone call from KPMG partner Ahmad Nasri Abdul Wahab where the request was made after the auditors were dissatisfied with the information that the company had provided then.

The 12th prosecution witness said this during cross-examination by Wan Aizuddin in Najib’s trial over the misappropriation of RM2.3 billion in funds from 1MDB.

Wan Aizuddin: What was your reaction when you heard KPMG’s request?

Azmi: I was surprised. I asked why they wanted to meet the prime minister. They say they wanted to hear from the shareholder that everything is okay. They said if Najib said okay, then they would sign off (on 1MDB financial statement).

Wan Aizuddin: You said they (KPMG) said, ‘If PM said okay, they will sign off’. So, you would agree that after the meeting with Najib, he never said, "okay you can sign off” to which Azmi answered: "Those words did not come from him”.

Azmi also said that he had conveyed KPMG’s request to fugitive businessman Low Taek Jho, or Jho Low, after his conversation with Ahmad Nasri.

Azmi: Jho Low was saying, why, why meet PM? So I said, they (KPMG) said if they met and were satisfied and PM knows and it’s okay, they will sign off. I was pressured by Jho Low (who asked) ‘Sure ah, sure ah, they will sign off?’.

The counsel then queried why Jho Low was the first person that Azmi had contacted regarding KPMG's request to meet Najib, to which the witness said that none of them dealt directly with the PMO (Prime Minister’s Office) and that in that sense, they believed he was the (PM’s) representative.

When asked why the witness chose Jho Low instead of Datuk Azlin Alias, Najib’s principal private secretary then, the witness said that although he consulted Azlin at times, Jho Low was playing the major role because he (Jho Low) was handling audit and 1MDB matters.

The court also heard that even after the Dec 15 meeting, there was no final audit report produced by KPMG.

To another question, the witness said Najib did not call and asked him to replace KPMG with Deloitte.

It was reported that after a meeting with Najib, KPMG was dropped as auditors of 1MDB and Deloitte was then brought on board to audit the fund’s 2013 financial statement.

Previously, former 1MDB chief executive officer Mohd Hazem Abd Rahman testified that KPMG was removed as 1MDB auditor following pressure from Najib.

Najib, 68, is facing four charges of using his position to obtain bribes totalling RM2.3 billion from 1MDB funds and 21 charges of money laundering involving the same amount.

The trial before judge Datuk Collin Lawrence Sequerah continues tomorrow. - Bernama