Witness: SRC did not use part of RM4 bln KWAP loan as planned
KUALA LUMPUR: An offshore assets recovery specialist told the High Court here yesterday that portions of the RM4 billion loan obtained by SRC International Sdn Bhd from the Retirement Fund Incorporated (KWAP) was not invested in activities related to energy and resources sector, as was its intended purpose.
Quantuma International Managing Director Angela Barkhouse said when Bank Negara Malaysia (BNM) authorised the loan from KWAP to SRC, the bank also set out First Permission that RM1.8 billion from the first KWAP loan to be used to acquire two companies in Indonesia – PT ABM Investama and Bumi Resources TBk PT – and two companies in Mongolia namely Gobi Coal and Energy Limited and Erdens-Tavan Tolgoi.
Barkhouse, who testified as the second witness in the SRC International civil suit trial, said the central bank’s Second Permission stated that the second KWAP loan of RM2 billion should be used for investments in energy and natural resources industries, excluding oil and gas.
“Some funds were invested in PT ABM Investama and
Gobi Coal and Energy Limited, however, the majority of the KWAP loans was neither to acquire the four entities listed in the BNM’s First Permission nor invested in energy and natural resources, as set out in the Second Permission,” she said.
Barkhouse was testifying online from British Virgin Island during SRC International Sdn Bhd’s US$1.18 billion lawsuit against Datuk Seri Najib Tun Razak which is being heard before judge Datuk Ahmad Fairuz Zainol Abidin.
The witness said in order for SRC International to make foreign currency loans to nonresidents, BNM needed to grant the company such permissions and to agree to the purpose among other features.
“Only through these permissions is SRC International authorised to make the necessary foreign currency loans to SRC BVI,” she said.
Subsequently, Barkhouse said the funds that were funnelled from SRC International into the SRC BVI account were transferred to five companies namely Cistenique Investment Fund B.V, Enterprise Emerging
Market Funds B.V, Muraset Limited, Gobi Resources Coal Ltd and Pacific Rim Global Growth Ltd.
“Both Cistenique and Enterprise Emerging were established as investment funds, however, based on my investigations, these two companies have shown that they were not legitimate investments and were in fact ‘pass-through’ entities used for the purpose of concealing the misappropriation of assets and facilitating the onward movement of funds.
“My investigations regarding the funds paid to Pacific Rim indicate that these funds were transmitted onwards shortly after being received, which supports the United States Department of Justice’s suggestion that it was acting not as a legitimate fund but for the purpose of concealing the misappropriation of assets, in a similar manner to Cistenique and Enterprise Emerging,” she said.
Barkhouse added that there seemed little commercial sense in the transfers to Muraset or to Gobi Resources, a company linked to fugitive businessman Low Taek Jho.