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A former director of SRC International Sdn Bhd testified in the High Court today, stating that Datuk Seri Najib Tun Razak exerted complete control over the company's operations, either directly or through his proxy, former CEO Nik Faisal Ariff Kamil. Datuk Suboh Md Yassin, 73, explained that all major investment and strategic decisions required Najib's approval, significantly diminishing the powers and roles of other SRC directors.
Suboh revealed that Najib's influence was formalized through various shareholder minutes issued in his capacity as Ministry of Finance Incorporated or conveyed by Nik Faisal on Najib's behalf. "SRC is unlike any other private limited company where directors typically have the authority to make decisions independently. SRC's setup was peculiar," Suboh stated during his testimony, led by SRC's counsel Abraham Au.
As a third-party respondent in SRC International's US$1.18 billion civil suit against Najib and Nik Faisal, Suboh elaborated on the unique governance of SRC. Despite being a private limited company, SRC operated more like an extension of the Ministry of Finance, with Najib holding absolute control, akin to a civil servant following top-down directives.
Suboh described the unusual practice of implementing decisions through "shareholder instructions" conveyed via shareholder minutes. Critical matters like financing, bank account management, CEO appointments, and joint ventures were directed by Najib's shareholder minutes, often issued before any formal board resolution.
Suboh emphasized that the company directors felt compelled to follow Najib's instructions due to their fiduciary and statutory duties. Nik Faisal served as the primary liaison between the board and Najib, often bypassing direct communication with Suboh, who was frequently asked to sign documents without full disclosure of their purposes. Statements like "boss nak lah" (the boss wants it) were used to indicate Najib's directives.
During cross-examination by Najib's counsel, Muhammad Farhan Muhammad Shafee, Suboh clarified that Nik Faisal was the sole contact between the board and Najib, perpetuating the fear of Najib's power to "hire and fire" board members. "In running the company, our contact point was Nik Faisal. We were denied information," Suboh testified.
The trial, presided over by Judge Datuk Ahmad Fairuz Zainol Abidin, continues tomorrow. SRC, under new management, filed the suit in May 2021, accusing Najib of breach of trust, power abuse, personal gain from company funds, and misappropriation. The company seeks a court declaration holding Najib responsible for SRC's losses and demands that he repay RM42 million.
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