KUALA LUMPUR – The high court here today ordered Datuk Seri Najib Razak and four other defendants to respond to a suit filed by SRC International Sdn Bhd for alleged breach of trust and breach of statutory duty in relation to the RM4 billion Retirement Fund Inc (KWAP) loan to SRC by August 30.
The four were SRC’s former directors, Datuk Suboh Md Yassin, Nik Faisal Ariff Kamil, Datuk Mohammed Azhar Osman, and Datuk Che Abdullah @ Rashidi Che Omar.
Lawyer Muhammad Farhan Muhammad Shafee, who appeared for the former prime minister, said the court has ordered the defendants to file their statements of defence by the end of the month.
“The court also ordered the plaintiff (SRC) to file its reply to their defence by September 30.
“October 4 was set for next case management,” he told reporters after case management today, which was conducted online before judge Datuk Ahmad Fairuz Zainol Abidin.
He said that in the meantime, SRC was preparing a substituted service application to serve the writ of summons against Nik Faisal, since he is unreachable and out of jurisdiction (out of the country).
On May 7, SRC under its new management had filed legal action against Najib and its former directors Suboh, Azhar, Nik Faisal, Datuk Shahrol Azral Ibrahim Halmi, Tan Sri Ismee Ismail. and Che Abdullah.
However, on July 22, it removed Ismee’s and Shahrol’s names from the suit and retained the others as defendants.
SRC, a subsidiary of 1Malaysia Development Bhd in the writ of summons, alleged that all the defendants conspired and committed a breach of trust, and claimed that the former prime minister had abused his power and obtained personal benefits from SRC funds as well as misappropriated funds.
Najib was the adviser emeritus of SRC from May 1, 2012, to March 4, 2019.
SRC, which is now wholly owned by the Ministry of Finance Incorporated (MoF Inc) is seeking a declaration that all the defendants are liable to pay the loss of investment funds as a result of the use of the loan amount in addition to claiming general damages, exemplary, additional and interest, costs, and other appropriate relief provided by the court.
SRC, in its writ of summons, said that in January 2019, the company was placed under the care of officials from the Finance Ministry (new management) and, after scrutinising and reviewing SRC records, found that SRC’s previous directors had not taken any reasonable steps to ensure KWAP's loans amounting to RM4 billion to SRC in 2011 and 2012 were used properly to finance the company's general investment activities and general working capital requirements.
The company claimed that the previous directors did not monitor the disposal of RM3.6 billion to proposed investment fund SRC BVI, allegedly for SRC to undertake investment activities in the energy resource sector overseas; failed to monitor the Malaysian government’s exposure to guarantees given to SRC, and failed to inquire about the misappropriation of SRC funds.
“The new management also found that a large number of withdrawals, transfers, and use of KWAP loans were fraudulent or wrong,” the company said in its writ of summons. – Bernama, August 3, 2021
