Malaysia’s former prime minister charged in corruption case

Najib Razak pleads not guilty to criminal breach of trust and abuse of power

Malaysia’s former prime minister Najib Razak greets his supporters as he leaves a court in Kuala Lumpur on Wednesday. Photograph: Lai Seng Sin/Reuters

Najib Razak, the former prime minister of Malaysia, was charged with criminal breach of trust and abuse of power on Wednesday, and pleaded not guilty in the most high-profile corruption trial in the country's history.

The charges – for which a guilty verdict could result in 20 years in jail as well as fines and caning – were linked to SRC International, a former subsidiary of 1MDB, the state investment fund from which $4.5 billion (€3.9 billion) has allegedly gone missing. Mr Najib might be exempt from caning because he is over the age of 50.

Mr Najib was granted bail for RM1m ($247,000) and must surrender his passports to authorities.

Wednesday’s court proceedings were the most significant milestone yet in an escalating probe into 1MDB launched by prime minister Mahathir Mohamad immediately after ousting his former protege Mr Najib in elections in May.

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The events at the high court in Kuala Lumpur heightened emotions for supporters and critics of Mr Najib. Jumilah Abdul Malek, a 55-year-old construction surveyor, was jubilant. "This is history," she said.

Meanwhile, supporters of Mr Najib swarmed the lobby of the courthouse after the bail hearing, chanting "Malaysia!" as Tommy Thomas, attorney general, tried and failed to give a press conference.

The charges allege that in December 2014 Mr Najib, then prime minister and finance minister, was given the authority to manage RM4bn of funds at AmIslamic Bank belonging to SRC, and that he went on to commit three breaches of trust involving a total of RM42m (€8.9 million) of that money.

Mr Najib was also charged with abuse of office to gain personal gratification in the form of the RM42 million, after agreeing to a government guarantee on RM4 billion of loans from pension fund Kumpulan Wang Persaraan to SRC between August 2011 and February 2012.

Quiet plea

The former prime minister’s plea was barely audible at the bail hearing, where several of his relatives, including his daughter and two of his sons, looked on. Rosmah Mansor, his wife who is also embroiled in the 1MDB investigation, did not attend.

A date for the trial will be set on August 8th, and it is expected to take place between mid-February and mid-March next year.

Judge Mohd Sofian Abd Razak agreed to a temporary gagging order requested by Muhammad Shafee Abdullah, Mr Najib's lawyer, that banned media from commenting on the merits of the case until August 8th.

“The gag order is very vague . . . I did not expect the judge to accept it,” said Mark Ho, a solicitor who was observing the bail hearing.

SRC was established in 2011 by Mr Najib to generate investment in the energy sector, but was linked to the 1MDB investigation in 2015 when it emerged that RM42 million was allegedly transferred from the company to Mr Najib’s personal accounts.

Mr Najib was arrested at his personal residence in Kuala Lumpur on Tuesday and spent the night at the anti-graft commission headquarters.

Later that night a video was posted on Mr Najib’s Twitter account featuring melancholic music, an apology to the country and a statement that not all allegations against him were true.

Mohamed Apandi Ali, the country's previous attorney general, had cleared Mr Najib of wrongdoing with regards to the RM42 million. – Copyright The Financial Times Limited 2018