Judge Blasts Najib as 'National Embarrassment' With 1MDB Guilty Verdict Upheld
Malaysia Court Upholds Najib’s Guilty Verdict in 1MDB Appeal
(Bloomberg) -- A Malaysia court upheld former leader Najib Razak’s guilty verdict from the first of a series of trials linked to troubled state fund 1MDB, with a judge referring to his actions as a “national embarrassment.”
Najib failed to overturn his 12-year prison sentence after the Court of Appeal Wednesday affirmed he was guilty of all seven charges in the case involving 42 million ringgit ($10 million) of funds belonging to SRC International, a former unit of 1MDB. The court allowed his application for a stay of execution that would keep him out of jail while he appeals to Malaysia’s highest court.
Najib’s interest in SRC went beyond his public office, Judge Abdul Karim Abdul Jalil said in reading a 200-page judgement. “We are in full agreement that Najib knew that funds entering his personal accounts are proceeds from unlawful activities,” he said, rejecting the former prime minister’s claims his actions were taken in the national interest.
“This is not something that can be said to have been done in national interest, instead national embarrassment,” Abdul Karim added.
The outcome is a setback for Najib, 68, who has spent the years since the 2018 shock election defeat rehabilitating his image and maintaining his innocence. Still, the appeals process could take years, possibly allowing him to participate in a federal election that must be held by 2023.
“Politically, if he’s locked away, he cannot stand for elections,” said Serina Rahman, a visiting fellow at ISEAS-Yusof Ishak Institute in Singapore. “He may still remain popular. He will milk the sympathy card, and people who have been his fans will likely remain his fans. They will believe that it is a political charge.”
Even so, the court upholding the verdict indicates that the “law fraternity is not swayed by political maneuvering. Malaysian citizens and the world, will be hugely relieved that the judges kept to the verdict,” she said.
‘Concoction’
Najib, who attended the hearing via Zoom, was seen taking notes throughout the judge’s reading of the decision, his face impassive.
“I would like to say, reiterate and to say once again that I didn’t know, nor did I ask for it, neither did I direct anyone for the 42 million ringgit to be transferred to my account,” Najib said at a virtual briefing after the verdict. Najib said he was disappointed by the court describing his actions in SRC as a “national embarrassment.”
“My career has been focused on how to promote national interest. During my tenure as prime minister, the total assets of the country grew from 800 million ringgit to 2 trillion ringgit. I created a lot of wealth for the country. That’s just one example.”
Najib was convicted of money laundering, corruption and criminal breach of trust in July last year. He was fined 210 million ringgit on top of the jail term, and faces more trials on dozens of other 1MDB-related charges.
The money from SRC ended up in Najib’s personal account and was spent by him, claiming it was a no-strings-attached donations from Saudi Arabia’s King Abdullah Al-Saud who passed away in 2015. This “Arab donation story is a concoction. The money is from SRC and it has been fully established,” the judge said.
Investor Perception
For better or worse, Najib’s fate is directly tied to Malaysia’s standing in the world. The 1MDB probe spanned the globe, with investigators from the U.S., Switzerland and Singapore all working to recoup billions of dollars belonging to Malaysian tax payers. Any appearance of political interference in Najib’s cases risks damaging perceptions of the Southeast Asian nation among investors.
The Court of Appeal on Tuesday dismissed Najib’s application to add new evidence in the to quash his conviction. The hearing was held virtually despite a request by Najib’s legal team for a delay after one of his lawyers tested positive for Covid.
“The international markets and international community will be very pleased with today’s result,” said James Chin, a political analyst from the University of Tasmania. “Politically, the best way to see it is that Najib’s star was on the way up yesterday. Today, his star has been stopped dead in the tracks, but this doesn’t mean he can’t make a comeback. It means that he is not flying as fast as yesterday.”
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