In a significant court appearance today, Datuk Seri Najib Razak testified that he was unaware of the RM3.6 billion funds distributed by SRC International Sdn Bhd, asserting that he had no fiduciary responsibilities regarding their management. This testimony took place during the ongoing civil suit against him in the Commercial High Court, where SRC International is seeking US$1.18 billion (approximately RM5.58 billion) in damages.
Najib, who is currently the first defendant in this high-profile case, explained that the RM3.6 billion was part of a larger RM4 billion loan from the Retirement Fund Incorporated (KWAP), which is responsible for managing the pensions of Malaysia’s civil servants. This loan was distributed in two separate tranches of RM1.8 billion each.
During his testimony, Najib emphasized that he lacked any authority within the corporate governance structure of SRC International to manage or verify the utilization of the funds. "As I have mentioned previously, I do not control the movement and use of SRC funds, aside from ratifying decisions made by the board, who are expected to conduct due diligence," he stated.
Under cross-examination by lawyer Datuk Lim Chee Wee, Najib acknowledged that Cabinet members indeed have fiduciary duties to act in the public interest. He noted that at the time, he held significant positions as both Prime Minister and Finance Minister, making him the sole shareholder of SRC International through the Minister of Finance (Incorporated).
Najib’s lack of fiduciary responsibility became a focal point during the questioning, as he confirmed that public officials must ensure that their actions do not create conflicts between their public duties and personal interests.
The case against Najib has its roots in allegations of misappropriation of funds. SRC International, under new management, filed the lawsuit in May 2021, initially including several former directors as defendants but ultimately retaining only Najib as the primary defendant. He has since added these former directors as third-party respondents.
The plaintiff, SRC International, claims that Najib abused his power and derived personal benefits from the company’s funds, which includes a controversial US$120 million that allegedly ended up in his bank account. The court proceedings are expected to continue, with SRC seeking a declaration that Najib is liable for the company’s financial losses and demanding compensation for the alleged breaches of trust.
Since August 2022, Najib has been serving a 12-year prison sentence along with a RM210 million fine for his conviction related to the misappropriation of RM42 million from SRC International. However, his sentence was recently adjusted to six years in prison and a RM50 million fine by the Pardons Board.
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