SINGAPORE (Dec 3): Najib Razak, in an interview with Sinar Harian two weeks ago, conceded that based on information available today, Jho Low had cheated Malaysia of billions of dollars through transactions done by 1Malaysia Development Bhd (1MDB).
He claimed, however, that he was unaware that anything was wrong because he was not told about it. He put the blame solely on Goldman Sachs and 1MDB’s lawyers and auditors for allowing wrongdoings to take place.
“They should have informed me if something was not right,” Najib said. “They clearly failed in carrying out their responsibilities.”
Najib obviously still refuses to take any responsibility over 1MDB and is blaming everyone else and pleading ignorance. A few months ago, he put the blame on 1MDB’s board of directors.
Over the past four years since The Edge Malaysia, which I own, had its run-in with Najib’s government over our exposés of wrongdoings at 1MDB, I have refrained from making any public comment on what happened back in 2014/15.
I have also not said anything in public about how the matter was handled by Najib, whom I have known for more than 25 years. I felt it was best left to investigators to do their work.
But I think it is now time that some things be told because Najib’s act of innocence over 1MDB and Jho Low should no longer be tolerated.
1MDB was started by Najib in 2009 and the first deal it did was a US$1 billion joint venture with PetroSaudi International (PSI), which eventually rose to US$1.8 billion in 2011.
Not much information was revealed about the progress of that joint venture between 2009 to 2013, by which time 1MDB had accumulated debts of over RM38 billion, including raising three bonds totalling US$6.5 billion with the help of Goldman Sachs to buy two power plants and to develop the Tun Razak Exchange (TRX).
Starting from December 2013, The Edge Malaysia began to scrutinise all these transactions. We questioned why 1MDB had overpaid for the power plants, the land in Penang and the huge fees of over US$600 million to Goldman Sachs. The Edge Malaysia also asked why 1MDB had three auditors in five years and cast doubt on how it could pay its mountain of debts, given that it has not much cash flow.
The Edge Malaysia’s reporting from December 2013 to December 2014 led to concerted personal attacks on me. I was accused by certain unnamed bloggers of getting The Edge Malaysia to publish fake negative news, as I had taken short positions in the ringgit.
We traced one source of these attacks to a person using the blogging handle Ahrily90. We discovered that the same Ahrily90 had also made vicious attacks against Dr Mahathir Mohamad and Nazir Razak who, by then, had also openly criticised what was happening at 1MDB.
Even more significant was that Ahrily90 was also behind two social media sites that promoted Jho Low as a successful and charitable businessman!
This confirmed our suspicion that not all was well at 1MDB, as the then government had insisted, and that Jho Low certainly had a lot of interest to make sure 1MDB did not get any negative reporting.
But how could we support our suspicion with facts and proof?
The chance came when we were told that Sarawak Report editor Clare Rewcastle Brown knew of a whistleblower who had evidence of wrongdoing to share.
On Feb 10, 2015, The Edge Malaysia publisher Ho Kay Tat and I met Clare in Singapore and we were introduced to Andre Xavier Justo, who had worked at PSI as a senior director. The documents and emails that we received from Justo were the proof we needed.
It took us a few weeks to go through the documents to piece together how much of the US$1.8 billion that 1MDB invested in the JV with PSI were siphoned out by Jho Low and PSI founders Tarek Obaid, Patrick Mahony and Prince Turki.
On March 6, 2015, at 10.45pm, I met Najib at his Jalan Duta house at the request of Abdul Azeez Abdul Rahim, the then MP for Baling, chairman of Tabung Haji (the Malaysian hajj pilgrims fund) and a close confidant of Najib.
By that time, the continuous reporting on the problems at 1MDB by The Edge Malaysia in the past year had made many in Umno uncomfortable. I guess Azeez probably hoped that I could be convinced that all was well and that we stop reporting on 1MDB. Azeez did not know what we knew from the documents from Justo when he arranged that meeting.
I met Najib in the living room. It was just us.
He started by telling me The Edge Malaysia was wrong and that the problems of 1MDB were its business model of carrying too much debt. There was no theft of money.
I told him otherwise. I shared with him information that I believed was proof that it was all a scam, with Jho Low at the centre of it. I explained how the accounts were made up to report a profit and why I believed the cash was all gone.
After about half an hour, he relented and told me he would shut down 1MDB. He didn’t say what he was going to do about the debts.
I then proceeded to tell Najib that Jho Low must be held accountable and be prosecuted. This upset him. He immediately stood up, walked to the door and asked me to leave.
I was taken aback that he was so sensitive about Jho Low.
The meeting late into Friday night with Najib did not end well, but The Edge Malaysia had already decided to publish its first exposé based on the documents we received from Justo.
The cover story, titled “Shahrol, Please explain Good Star, the money 1MDB paid the company and why you took instructions from Jho Low”, hit the newsstands the following day, on March 7, 2015.
In the weeks after, The Edge Malaysia intensified its exposés.
Paul Stadlen, Najib’s media adviser who is now wanted by investigators, met me on about half a dozen occasions, initially to persuade but later to threaten me about The Edge Malaysia’s reporting on 1MDB.
While The Edge Malaysia’s reporting was focused on 1MDB and Jho Low, Stadlen made it very clear that any attack on Jho Low was an attack on Najib, and that he was conveying this message from his boss.
The pressure on us was growing but The Edge Malaysia did not back off.
I discussed the situation with Najib’s brother Nazir, who had been working closely with me since 2014 to find ways to uncover the shenanigans at 1MDB so that action could be taken. Nazir was also under a lot of pressure to back off.
We agreed that we needed to seek help from Dr Mahathir and flew to London in April, where he was at the time, to brief him. We felt only Dr Mahathir could do something.
Aside from Dr Mahathir, Nazir and I also met a few other government leaders. I met Muhyiddin Yassin, who was deputy prime minister. All of them wanted to know more about what had happened at 1MDB.
Muhyiddin subsequently spoke up and paid the price, as Najib dismissed him as DPM and sacked him from Umno.
On July 24, 2015, the Home Ministry suspended The Edge Malaysia and The Edge Financial Daily after the latter published a Page 1 story titled “How Jho Low and PetroSaudi cheated Malaysia of US$1.83 billion cash”.
It was obvious that our front page allegation that Jho Low stole US$1.83 billion, supported by a money trail showing cash transfers into bank accounts, spooked Najib into suspending us. Kay Tat and I were investigated by the police for economic sabotage and I was barred from leaving the country.
Najib knew what Jho Low did. We provided the evidence and he shut us down to shut us up.
Tong Kooi Ong is chairman of The Edge Media Group