HOBART: On Monday (Nov 11), a Malaysian court ordered former prime minister Najib Razak to present his defence against seven counts of criminal breach of trust, money laundering and abuse of power in a case linked to SRC International.
Many in Malaysia expressed happiness with this verdict and think that Najib will finally be found guilty in a court of law over the 1Malaysia Development Berhad (1MDB) scandal. Unfortunately, the reality is slightly different.
A STRONG DOSE OF REALITY
First, the verdict delivered yesterday was not a ruling on Najib’s culpability. It was simply a court procedure forcing Najib’s legal team to present a legal defence to charges relating to about RM42 million (US$10 million) that ended up in his personal account.
The money came from a RM4 billion loan taken by SRC International from a government-backed civil servant pension fund, KWAP.
At the time the loan was taken, SRC International was a separate legal entity from 1MDB though it had started off as a subsidiary of 1MDB.
Second, the ruling simply allowed the trial to go ahead to hear Najib’s defence, which is likely the position that the RM42 million was a donation from a friendly Arab source, and nothing to do with SRC International.
Third, most legal observers already expected this ruling. When the prosecution proves a prima facie case, the accused will have to enter his or her defence before a verdict is granted.
In simple terms, what happened yesterday was that the judge decided there is enough evidence to proceed to the full trial - nothing more.
According to Najib’s defence team, their defence will be completed just before Christmas so don’t expect a verdict until at least after Christmas.
MEANWHILE, ON THE “REAL” 1MDB TRIAL
But the more serious 1MDB trial that we should be paying attention to is running concurrently with the SRC International case.
READ: Ex-Goldman banker in 1MDB case to face Malaysia trial next year
This one deals with the actual money from 1MDB and is still ongoing.
In this trial, Najib faces 25 charges in total - four for abuse of power that allegedly brought him financial benefit to the tune of RM2.3 billion, a quarter of the 1MDB fund, and 21 for money laundering involving the same amount of money.
This one is far more interesting than the SRC International case. Thus far, a key witness, Shahrol Azral Ibrahim Halmi, former 1MDB chief executive officer, has told the court, among other facts, the following.
First, he had no financial experience but he was appointed by Jho Low anyway.
Second, he had signed off minutes of a meeting that took place between him and the chairman of 1MDB’s board of advisors, even though there was no such meeting.
Third, he described Jho Low as an "orchestra conductor” manipulating different parts and had deemed whatever Jho Low told him to do as coming from Najib himself.
Fourth, he was paid RM99,000 a month and received an 18-month bonus totalling RM1.44 million from Najib for his outstanding performance.
Fifth, the 1MDB board members did not give consent to decisions that involved splitting a US$1 billion funding. Decisions had to be approved by Najib.
Sixth, 1MDB had spent USD$17,000 on Starbucks. In a separate incident, some US$1.3 billion was wired to an account, Gold Star, and Shahrol did not check if the money was wired to its intended beneficiaries.
Seventh, Jho Low’s code name for Najib Razak was Optimus Prime while Low’s code name was fei lou, or “fat boy” in Cantonese.
This trial will take some time, again don’t expect any verdict until next year at the earliest. But we can expect more revelations.
APA MALU BOSSKU
Yet, despite the two concurrent trials, Najib appears to have lost none of his political stardom.
He has reinvented himself as a social media influencer with the tagline “Malu apa bossku” (what is there to be ashamed?). His social media postings are widely read. He has more than 4 million followers on Twitter alone. Najib even appeared in a music video rap version of Bossku.
He has been invited to many key political events organised by the opposition and is always seated at the front row of any UMNO event. This is despite the fact that it was under his leadership that UMNO lost power after holding power since independence.
In any normal political system, Najib would have been isolated and his party UMNO will try to hold him at a distance.
But this is Malaysia where facts often do not matter. In a social media age, star power and the ability to shape political messages are far more important.
Najib’s political star is so bright that he is among those who have hogged the media spotlight when campaigning for the Barisan Nasional in the Tanjung Piai by-election. He has even asked the court to be excused this coming Friday because he is campaigning.
If Barisan Nasional wins Tanjung Piai this coming Saturday, Najib’s political star will rise as well.
THE BIG PICTURE
Might Najib have a strategy to all these? The short answer is yes.
Najib and his team know that if he is found guilty, which at the earliest will be next year, he could appeal.
In other words, there is a very slight chance that Najib will be around and can run as a candidate when the next general elections is held in 2023.
But if Najib is found guilty of even one of the many charges, he will automatically lose his status as a Member of Parliament once the appeals are exhausted. Again, the process will drag on for years.
Even then, in this scenario, this does not mean the end of Najib’s political career. If the UMNO/PAS pact captures the government in 2023, there is a chance that they could look favourably upon Najib.
A new government could grant Najib a pardon, just as Anwar Ibrahim was granted a pardon the moment the Pakatan Harapan (PH) coalition won the last general elections.
Najib may be also betting that the PH administration will not hold or last the distance. There are rumours that the PH alliance will fall apart at the seams as the tensions over the power transfer from Mahathir Mohamad to Anwar intensifies, and a new governing coalition will emerge with new member parties in the PH coalition.
If the new coalition includes the UMNO/PAS combo, then there will little political incentive for the ruling party to go after Najib.
The key to all this of course relies on Najib maintaining a high political profile.
If he can show UMNO and the rest of Malaysia that he can still deliver votes and attract a significant following, the corruption trials may have little impact on Najib’s standing in the future.
Thus, no matter how his legal trials are proceeding, expect Najib to maintain a high political profile and act as if everything is normal.
Professor James Chin is director of the Asia Institute Tasmania at the University of Tasmania and senior fellow at the Jeffrey Cheah Institute on Southeast Asia.