Did Najib abuse his position by approving RM4 billion loan guarantees for SRC?

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Najib Abused His Position by Approving RM4 Billion Loan Guarantees for SRC International

Datuk Seri Najib Razak abused his position by participating in Cabinet meetings that approved RM4 billion in government guarantees for loans to SRC International Sdn Bhd. As Prime Minister and Finance Minister at the time, Najib's involvement in the Cabinet meetings on August 17, 2011, and February 8, 2012, which sanctioned these guarantees from the Retirement Fund Incorporated (KWAP), constituted an abuse of power. The prosecution argued that the offense under Section 23 of the Malaysian Anti-Corruption Commission Act is complete upon the use of one's position to obtain gratification, irrespective of whether gratification was actually received.
Najib's Undisclosed Interest and Participation in Cabinet Deliberations

Evidence presented indicated that Najib neither declared his personal interest in SRC International nor recused himself from discussions concerning the KWAP loans during the relevant Cabinet meetings. Tan Sri Mazidah Abdul Majid, the former deputy chief secretary to the government, testified that Najib remained present and involved in these deliberations. This presence, it was argued, precluded other Cabinet members from independently assessing the loan guarantees, given Najib's superior position and his presiding role in the meetings.
Absolute Control Over SRC International Through its Articles of Association

Najib held significant control over SRC International, stemming from Articles 67 and 116 of the company's Memorandum and Articles of Association. These articles granted him absolute authority, including the final say on director appointments and removals, as well as amendments to the company's governing documents. This structure, coupled with his appointment as Advisor Emeritus of SRC International, provided him with substantial power over the company's operations and direction.
Instruction for Additional RM2 Billion Loan Through Najib's Influence

Further evidence showed that Najib directly instructed SRC International to seek an additional RM2 billion loan from KWAP in February 2012, as documented in a Directors' Circular Resolution. At this time, SRC International was fully owned by the Ministry of Finance Incorporated (MOF Inc), placing it under Najib's ultimate control as the finance minister. The KWAP Investment Panel proceeded based on the information that the finance minister had approved this additional loan, indicating Najib's directive influenced the panel's decision.
SRC International's Establishment and Initial Loan Acquisition

SRC International was initially established with Najib's support in August 2010, following a request from 1MDB for a RM3 billion federal grant directly to Najib for the company's formation. Despite initial reservations from the Economic Planning Unit (EPU), which suggested commercial bank financing, SRC International ultimately secured a loan from KWAP, facilitated by Najib's intervention. This intervention bypassed the EPU's recommendation and provided SRC International with a government-backed loan, a privilege that was contested as unfair competition.

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Did Najib abuse his position by approving RM4 billion loan guarantees for SRC?

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