In Najib trial, ex-1MDB CEO Hazem says quit because Jho Low controlled funds; adds even subordinates didn’t want job

Ex-1MDB CEO Mohd Hazem Abd Rahman arrives at the Kuala Lumpur High Court September 15, 2020. — Picture by Yusof Mat Isa
Ex-1MDB CEO Mohd Hazem Abd Rahman arrives at the Kuala Lumpur High Court September 15, 2020. — Picture by Yusof Mat Isa

KUALA LUMPUR, Sept 17 — Mohd Hazem Abd Rahman who was CEO of government-owned 1Malaysia Development Berhad (1MDB) for less than two years told the High Court today that he wanted to resign from the position many times because he did not have control or even information over the status of the heavily-indebted company’s overseas funds estimated at billions of ringgit.

He was testifying as the 10th prosecution witness in former prime minister Datuk Seri Najib Razak’s power abuse and money laundering trial over more than RM2 billion of 1MDB funds.

Mohd Hazem said that it was Low Taek Jho — whom he had described as Najib’s trusted right-hand man, advisor, proxy and middle man for 1MDB affairs allegedly delivering instructions agreed by Najib — who had control over 1MDB’s funds purportedly in existence abroad.

Mohd Hazem had throughout his testimony spoke of how 1MDB board of directors and senior management considered Low’s instructions to have originated from Najib and of how Najib had signed his approval to 1MDB’s financial decisions even before such matters were presented to the board of directors or to Mohd Hazem himself.

Mohd Hazem, who was CEO of 1MDB from March 2013 to early January 2015, highlighted that he had in fact as early as September 2013 told his colleague — 1MDB chief financial officer Azmi Tahir — in an email that he wanted to leave 1MDB as he felt then the company had fallen into the “biggest trap” in corporate history and that Low’s plans for 1MDB were unrealistic. 

Mohd Hazem said he had frequently met with Najib’s principal private secretary Datuk Azlin Alias to voice his worries over 1MDB’s excessively heavy debts and how the company’s funds were being managed, as well as his desire to step down.

“I also voiced my intention to the late Datuk Azlin to resign and be replaced with someone who is capable of heading 1MDB in a situation of heavy debts,” he told the court today.

Mohd Hazem said Azlin had advised him to wait and resign only after 1MDB lists its energy unit 1MDB Energy on Bursa Malaysia, but noted that he had in October 2014 after his return from a Muslim pilgrimage trip seriously expressed to Low and Azlin of his intention to resign from the 1MDB CEO post.

“I did ask Datuk Azlin to tell Jho Low to find a candidate to replace me as all the officers that were working below me did not want to replace me as all the officers working under me do not want to replace me, as this position of CEO was very much exposed to political elements,” he added.

Mohd Hazem had previously spoken of the political influence that was imposed over his role as 1MDB CEO, claiming that his attempts to resist some of Low’s orders on seemingly dubious 1MDB investment decisions resulted in Azlin telling him to unquestioningly comply with Low’s instructions as they were equivalent to Najib’s instructions.

Upon his return to Malaysia on January 3, 2015 from a holiday trip, Mohd Hazem said Azlin had told him that there was a candidate for the post of Assistant CEO and requested that he stay on as 1MDB CEO until Edra Energy or all of 1MDB’s subsidiaries in the independent power plant business become successfully listed on Bursa Malaysia in mid-2015.

Mohd Hazem then said that Arul Kanda Kandasamy reported to work on the first working day of January 5, 2015 as the 1MDB president, which meant that he as CEO would report to Arul Kanda.

“At this time, I made the decision that this is the appropriate time to resign as CEO as the portfolio of the president position is the same as CEO,” Mohd Hazem said when describing his move to finally quit as 1MDB CEO.

Najib’s trial before High Court judge Collin Lawrence Sequerah on October 5, with Najib’s lawyer Tan Sri Muhammad Shafee Abdullah expected to cross-examine Mohd Hazem.

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