Malaysia

Shafee’s RM9.5 mil merely loan to cover criminal act: prosecution

Why did lawyer not report such income to Inland Revenue Board, DPP questions

Updated 4 years ago · Published on 15 Sep 2022 8:35PM

Shafee’s RM9.5 mil merely loan to cover criminal act: prosecution
On September 13, 2018, Tan Sri Muhammad Shafee Abdullah (pic) pleaded not guilty to receiving proceeds from unlawful activity via cheques issued by Datuk Seri Najib Razak, which were remitted into Shafee’s CIMB Bank Bhd account. – The Vibes file pic, September 15, 2022

KUALA LUMPUR – Lawyer Tan Sri Muhammad Shafee Abdullah’s claim that the RM9.5 million he received from Datuk Seri Najib Razak was a loan is merely to cover his criminal act and to protect the source of the money. 

Deputy public prosecutor Afzainizam Abdul Aziz, in his closing submission, said Shafee on the other hand wanted to avoid paying taxes for the money he received and used it to purchase a bungalow worth RM9.3 million. 

Afzainizam said the lawyer had used the money for personal interest and questioned why the RM9.5 million income he had received was not reported to the Inland Revenue Board (IRB). 

“Why did this happen…it’s because he (Shafee) was mainly thinking about his personal gains by purchasing the bungalow. 

“As a lawyer, he should know that income must be reported, and lawyers are reminded by the Bar Council for income to be declared. However, he used 97% from the RM9.5 million to purchase an asset when in fact income tax should have been paid,” he said.

According to Afzainizam, Malaysian Anti-Corruption Commission (MACC) investigations also found that two cheques received from the former prime minister were money from illegal activities which were then deposited into the lawyer’s personal account.

He said Shafee had told the MACC that the RM9.5 million was a loan from Najib and therefore did not have to declare it to the IRB or pay taxes, as it was not income in the first place. 

Meanwhile, Harvinderjit Singh, representing Shafee, said the RM9.5 million received by his client from Najib was not from illegal activities. 

“The money was obtained legally after Shafee provided legal services to Najib regarding the Umno and Barisan Nasional (BN) election petitions,” he said, adding that Najib should be called to testify in court to prove that the money given was legal fees. 

At the end of the submissions, Judge Datuk Muhammad Jamil Hussin set October 28 as to whether Shafee will be acquitted or has to enter his defence against the four charges he is facing. 

On May 12, the prosecution closed its case, calling eight witnesses at the trial, which began on May 21, 2021.

On September 13, 2018, Shafee pleaded not guilty to receiving proceeds from unlawful activity via cheques issued by Najib, which were remitted into Shafee’s CIMB Bank Bhd account.

He allegedly received a cheque for RM4.3 million on September 13, 2013, and another for RM5.2 million on Feb 17, 2014.

The offences were allegedly committed at CIMB Bank Bhd, Taman Tunku, Bukit Tunku here.

The charges, under Section 4(1)(a) of the Anti-Money Laundering and Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001, carry a fine not exceeding RM5 million or up to five years’ jail or both upon conviction.

Shafee is also charged with two counts of engaging in transactions resulting from illegal activities, namely submitting incorrect tax returns, which is in violation of paragraph 113(1)(a) of the Income Tax Act 1967 for the financial years ending December 31, 2013, and December 31, 2014.

He allegedly committed the offences at IRB's Jalan Duta branch at Kompleks Pejabat Kerajaan, Jalan Tuanku Abdul Halim here on March 3, 2015 and June 29, 2015.

For this, Shafee is liable to be jailed for a maximum of 15 years and fined not less than five times the amount of proceeds from the unlawful activity, if convicted. – Bernama, September 15, 2022

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