1MDB trial: Najib’s cash transfers from own account originated from illegal funds, cop confirms to court

KUALA LUMPUR, Oct 18 — Former prime minister Datuk Seri Najib Razak’s cash transfers from his personal AmIslamic bank account in 2013 came from unlawful funds, based on money laundering investigations on 1Malaysia Development Berhad’s (1MDB) funds, an investigating officer told the High Court today.

Assistant Commissioner of Police Foo Wei Min said this while testifying as the 48th prosecution witness in Najib’s trial over the misappropriation of RM2.28 billion of 1MDB funds.

The RM2.28 billion were alleged to have entered the former finance minister’s two AmIslamic bank accounts (code named “AmPrivate Banking-MR” and “AmPrivate Banking-1MY”).

Foo, the assistant director of the police’s Commercial Crime Investigation Department’s money laundering investigation division, was in charge of investigating the alleged flow of funds from 1MDB through Tanore Finance Corp — a company owned by Low Taek Jho’s associate Eric Tan Kim Loong — to Najib’s AmBank accounts.

Today, deputy public prosecutor Kamal Baharin Omar asked: “Now, based on your whole investigation on money laundering, can you show actually the money that Datuk Seri Najib Razak transferred out actually originated from proceeds of unlawful activities?”

Foo replied: “Yes, My Lord.”

Previously, Foo had testified that Tanore had transferred RM2.081 billion (equivalent to US$681 million then) into Najib’s “AmPrivate Banking-MR” in nine transactions between March 22 to April 10, 2013, saying that these funds originated from a 1MDB subsidiary and were the proceeds of unlawful activities.

Foo had testified that Najib had then used the money that entered his “AmPrivate Banking-MR” account, by signing and issuing five cheques worth RM22.649 million from August 1 to August 7, 2013; “returning” RM2.034 billion (equivalent to US$620 million) to Tanore between August 2 to August 30, 2013; and by transferring funds totalling RM162.4 million to Najib’s new account “AmPrivate Banking-1MY” on August 27 and August 30, 2013.

By transferring the RM162.4 million out, Najib had cleared out the “AmPrivate Banking-MR” account as it had zero funds left and had closed this account on August 30, 2013 itself.

If the usage of the Tanore-originated funds into Najib’s “AmPrivate Banking-MR” is totalled up (based on the RM22.649 million cheques, the RM2.034 billion “return”, the RM162.4 million transfer to his other account), it would come up to a total of RM2.219 billion.

Investigating Officer Foo Wei Min is pictured at the Kuala Lumpur Court Complex, October 18, 2023. — Picture by Firdaus Latif

Foo however also explained today that calculations based on the “First In First Out” (FIFO) method would show that the actual sum of illegal funds in the “AmPrivate Banking-MR” account that Najib used would be a lower amount.

Using the FIFO method, it would involve the RM22.649 million cheques; a “return” of RM1.897 billion and transfer of RM161 million, which would come up to a total sum of over RM2.081 billion.

This is based on the FIFO method which would give the “benefit of doubt” to a person whose bank accounts are being investigated for money laundering, where money in the account that is being used would be assumed to have come from the existing legal sources first, until the legal funds are used up. Once the legal funds are used up, the next usage of funds would be assumed to have originated from illegal sources.

“In FIFO, when clean money enters the account, it will be used when there is usage of funds. When illegal money enters, the calculations will fully use up the clean money first. First in clean money, first out clean money.

“When all the clean money has been used, then the next usage would be illegal money, therefore we can differentiate and separate the usage of clean money and illegal money, and therefore benefit of doubt has been given to the person being investigated,” he said.

Foo said the FIFO method enables the distinguishing between illegal and legal sources of funds in a bank account, and whether money that was spent came from the legal or illegal sources.

Foo said the money laundering charges against Najib in the 1MDB trial had used the same figures from banking documents, instead of the lower figures of illegal money being used and derived from FIFO analysis, to avoid confusing the court.

Foo has investigated over 50 investigation papers linked to money laundering crimes in his 18 years at the police’s money laundering investigation division.

Najib’s wife Datin Seri Rosmah Mansor was seen in the courtroom today.

Najib’s 1MDB trial before judge Datuk Collin Lawrence Sequerah resumes next Tuesday.