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Malaysia: Najib Attorney Charged with Money Laundering

Hadi Azmi and Ali Nufael
Kuala Lumpur
2018-09-13
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Malaysia Anti-Corruption Commission officers escort lawyer Shafee Abdullah (center), into a Kuala Lumpur court where he was charged with money laundering and tax fraud, Sept. 13, 2018.
S. Mahfuz/BenarNews

A lawyer for former Prime Minister Najib Razak was arrested and accused Thursday of laundering more than $2 million but he claimed that the charges were politically motivated to remove him from the embattled politician’s defense team.

A court in Kuala Lumpur charged attorney Shafee Abdullah with two counts of money laundering and two counts of tax fraud for a pair of transactions totaling 9.5 million ringgit (U.S. $2.3 million) between September 2013 and February 2014. He could face up to 40 years in prison and fines up to $20 million ringgit ($4.8 million) if convicted of all charges.

Anwar Ibrahim, leader of the People’s Justice Party (PKR), alleged that Najib had paid Shafee the sum to prosecute him on a sodomy charge.

“This is sheer bully tactics that they are doing right now,” Shafee told reporters after posting the first half of his 1 million ringgit ($241,000) bail. The second half is to be paid by Sept. 18.

Najib faces charges related to allegations that 2.6 billion ringgit ($681 million) from SRC International, a subsidiary of 1Malaysia Development Berhad (1MDB) – a financially troubled state fund – ended up in two of his personal bank accounts.

In a Facebook posting Thursday, Najib said he had received 2.6 billion ringgit as a gift from Saudi Arabia in March 2013 and later returned the money.

The government charged Najib, who has pleaded not guilty to all eight counts against him, with money laundering, abuse of power and criminal breach of trust.

In charge sheets, prosecutors allege that Shafee received funds from accounts held by Najib at AmIslamic Bank.

Shafee, who was taken into custody by Malaysia Anti-Corruption Commission (MACC) officers, arrived at the court complex at 11 a.m., five hours after he was arrested at a Kuala Lumpur airport as he prepared to board a plane to Penang to attend a trial.

The lawyer called the charges baseless and political.

“If you look into their political manifesto, Pakatan Harapan (PH) said that they will charge everyone related to 1MDB. The best they can do so far with Najib is to charge him for SRC International,” Shafee said, adding that prosecutors were struggling to build a case around 1MDB.

Staff members with the Attorney General’s Chamber, he also said, were worried about the strength of Najib’s defense team and trying to undermine it by removing him. He pointed out that the indictment would not prevent him from representing Najib because he has not been convicted of any crime.

The U.S. Justice Department described 1MDB as the “worst kleptocracy scandal in recent times.” Prosecutors allege that at least $4.5 billion was stolen and diverted through acquisitions of real estate, artwork and luxury properties by Najib and his associates.

Allegations tied to payments

Last year, a court ruled against Anwar’s lawsuit to have a sodomy conviction overturned. Anwar claimed Najib went against the government’s normal practice of appointing lawyers from the attorney-general’s office by appointing and paying Shafee, a private lawyer.

Shafee, who was in court on Nov. 8, 2017, to hear the ruling, described Anwar’s allegation as nonsense.

“I was never paid 9.5 million ringgit to prosecute Anwar,” he said at the time.

 

On Sept. 6, Anwar challenged the statement, releasing an affidavit from an attorney general staffer who claimed Shafee was paid by Najib to prosecute Anwar “and therefore did not act independently but instead had a financial interest in prosecuting the appeals.” Anwar and the court were not aware of the payments at the time of the ruling, the affidavit stated.

“I maintain that Shafee should never have been allowed to prosecute the appeal in the first place,” Anwar said last week. “Appointing an outside prosecutor is not an ordinary practice by the attorney general, and is even more irregular in this case when the individual appointed is a known close confidante of Najib, who is himself materially involved in the case.”

Anwar, who helped lead the Pakatan Harapan (PH) coalition’s upset of Najib’s Barisan Nasional in May, has since received a royal pardon on two sodomy convictions and is in line to succeed Mahathir Mohamad as prime minister when the 93-year-old steps aside.

Facebook

In recent days, Najib has taken to Facebook, posting letters, bank statements and his own statements to explain that he received millions of dollars from a Saudi prince who was impressed with his efforts to govern Malaysia using Islamic principles.

On Monday, he posted a February 2011 letter where the prince promised a “gift” of $100 million (415 million ringgit). Another letter sent in March 2013 granted Najib a gift of up to $800 million (3.3 billion ringgit).

“This is merely a personal token of appreciation and I am hoping that the gift would encourage you to continue with your good work to promote Islam around the world,” the 2013 letter ends.

In another posting, Najib said he received $681 million (2.6 billion ringgit) promised as part of the second gift through two deposits in March 2013. He said he planned to use the money to aid BN campaigns in that year’s general election, but when he realized the money was not needed, he returned it.

Regarding the charges against Shafee, Najib called them an effort by the new government to intimidate his lawyers and deny a fair trial. He said the payments of 9.5 million ringgit were for services that Shafee’s firm rendered over the years, including election petition cases for two general elections.

“Charging Tan Sri Shafee for receiving payments for legal services rendered sets a very danger legal precedent for all lawyers, professionals and businesses,” Najib posted. “No one will be safe if the government chooses to victimize or to politically persecute you.”

1MDB update

Meanwhile, Deputy Police Inspector-General Noor Rashid Ibrahim on Thursday told reporters that 2.9 billion ringgit ($972 million using the exchange rate at the time) was transferred into Najib’s bank account between 2011 and 2013.

“Up to this point, 132 transactions involving proceeds from unlawful activities have been identified and further investigations are being carried out,” Rashid said.

Since the new government resumed investigating 1MDB following the May election upset, police have recorded statements from 64 people.

“There are several people close to Najib that we have also interviewed … and his family members. We expect to question more people in a week,” Rashid said. “We hope to get documented evidence from these people.”

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