New Aabar shell company emerges
Second firm with similar name set up in Seychelles, 1MDB trial defence team says
A second fake shell company bearing the name Aabar Investments PJS Ltd has emerged in the 1Malaysia Development Bhd (1MDB) trial at the High Court.
The defence, representing Datuk Seri Najib Razak who is accused of misappropriating RM2.28bil of 1MDB funds, revealed that there was another Aabar Investments PJS Ltd, with the company incorporated in Seychelles.
The first Aabar Investments PJS Ltd was set up in the British Virgin Islands (BVI).
The matter was raised when counsel Wan Aizuddin Wan Mohamed questioned 1MDB CEO Shahrol Azral Ibrahim Halmi on the remittance of US$223mil from 1MDB Energy Ltd to Aabar Investments PJS Ltd (BVI).
Wan Aizuddin: Was the board of directors of 1MDB briefed about this remittance of US$223mil to Aabar BVI?
Shahrol: No, we were not. The court previously heard testimonies that Aabar Investments PJS Ltd (Aabar BVI) was not the same as Aabar Investment PJS, which is the actual subsidiary of International PetroIeum Investment Company (IPIC).
Aabar BVI was set up by fugitive businessman Low Taek Jho and his associates in the BVI and the company was used to misrepresent Aabar Investment PJS.
Wan Aizuddin: As of right now, are you aware that there are two Aabar Investments PJS Ltd entities, one is in the British Virgin Islands and another in Seychelles?
Shahrol: I may have been shown documents during the investigation.
Wan Aizuddin: You agree that it has nothing to do with the real Aabar?
Shahrol: I cannot comment on that.
The court was also told that 1MDB had taken a US$975mil loan from Deutsche Bank but it was never utilised to pay back the “Aabar Options”.
(In 2014, 1MDB had proposed to list 1MDB Energy Group in Bursa Malaysia through the buy back option of Aabar Options.)
Wan Aizuddin then suggested that the proceeds of the loan was never paid to Aabar.
But Mohd Hazem Abdul Rahman, the CEO after Shahrol, had represented to the board of directors that the funds were used to pay back the
Aabar Options.
Wan Aizuddin: The proceeds of the loan were never paid to Aabar?
Shahrol: As represented by Hazem, yes.
Wan Aizuddin: The money was in fact transferred in two tranches to Aabar Seychelles.
Shahrol: Yes.
The witness was also questioned on 1MDB’s decision to take up the loans, with Shahrol saying the refinancing direction was discussed by the shareholder and “we went along with that”.
“In 2014 and 2015, a lot of the decisions along the Aabar Options and the IPIC guarantee was done at the Prime Minister’s Office level already,” said Shahrol.
Wan Aizuddin: Would you agree with me that surely, the shareholder and the chairman of the board of advisers (referring to Najib) would have only agreed to what had been proposed by the management?
Shahrol: I cannot comment as I have no knowledge of discussions between the management and chairman of the board of advisers.
Wan Aizuddin: Would you agree with me that as a prudent businessman, rather than taking that loan, liquidating the asset was the better option?
Shahrol: Yes, it would make a lot more sense to liquidate and pay the Aabar Options.
Najib, 67, is facing four charges of abusing his position to obtain gratification totalling RM2.28bil in 1MDB funds and 21 counts of money laundering involving the same money.
The hearing before Justice Collin Lawrence Sequerah continues today.