KUALA LUMPUR: The board of directors at SRC International Sdn Bhd was appointed to execute the wishes of the company’s shareholder, Datuk Seri Najib Razak, the High Court was told.
SRC International’s former director Tan Sri Ismee Ismail, 59, testified that it is typical for a newly established company’s board of directors (BOD) to be given a “blank slate” for them to run their operations, which would allow them to use their expertise and opinions to decide the company’s direction and determine which government-to-government endeavours to pursue.
However, according to the witness, this was not the case with SRC International’s BOD.
“The point I’m trying to say here is when we were appointed to this newly incorporated entity called SRC, we didn’t get a piece of blank paper saying ‘Board members, you tell us what to do with this company.’ That was not the scenario.
“In SRC, once you are appointed as a board member, you are told that these are the directions or wishes of the shareholder for the management to execute with support from the BOD,” Ismee said here yesterday.
Najib, who was the prime minister and the finance minister at the material time, was also SRC International’s sole shareholder by way of Minister of Finance (Incorporated).
Ismee, a third-party respondent, was under cross-examination by Najib’s lawyer Muhammad Farhan Muhammad Shafee in a US$1.18bil lawsuit the company filed against Najib and SRC’s former CEO Nik Faisal Ariff Kamil.
To another question, Ismee recalled an incident where he became upset at Nik Faisal, who remains at large, when he discovered the company did not file and submit SRC International’s accounts for the financial year 2013 ended March 31 to the Companies Commission of Malaysia (SSM), which was due in September 2012.
According to Ismee, a news article was published in The Edge, dated May 5, 2014, titled “SRC yet to file accounts or seek extension”.
“When I learnt of the article, I told Nik Faisal he should write a nasty (reply) to The Edge to rebut its article.
“However, Nik Faisal told me it was true that SRC had yet to file (the account). At this point, I shouted at him and this was when I made an effort to ensure the account was closed,” he recalled.
Nik Faisal, he added, had falsely assured “everything was good”.
“Kita tak sangka Nik Faisal penipu (We didn’t expect Nik Faisal to be a cheat),” said Ismee.
Under a new management, SRC filed the legal action in May 2021, alleging that Najib had committed breach of trust, abuse of power, misappropriated company funds and gained personal benefits.
It named Najib along with its former directors Datuk Suboh Md Yassin, Datuk Mohammed Azhar Osman Khairuddin, Datuk Che Abdullah @ Rashidi Che Omar, Datuk Shahrol Azral Ibrahim Halmi, Nik Faisal and Ismee.
However, later, it removed six names, including Ismee, from the suit and retained Najib and Nik Faisal as the first and second defendants.
Additionally, Najib has brought the formerly named SRC International directors as third-party respondents in the suit.
The company is seeking damages, interests, costs and a court declaration that Najib is responsible for the company’s losses due to his breach of duties and trust, and is demanding that Najib pay back the US$1.18bil in losses that it has incurred.
It is also seeking US$120mil and US$2mil from Najib and Nik Faisal respectively, on account of fraudulent breach of fiduciary duties and breach of trust.
The hearing before Justice Ahmad Fairuz Zainol Abidin continues on June 10.
