He said there were many senior-level figures who managed and were directly responsible for the company’s various operational, administrative, financial, reporting, legal, and other matters.
“These individuals had been carrying out their roles and working on various transactions well before I joined the company and continued to do so after I joined. Again, at that time, I had no reason to suspect these individuals of any wrongdoing.
“Hence, I was justified in asking them for information and relying on information they shared with me as well as explanations they provided to me on various matters under their scope of responsibility,” Arul Kanda said, Bernama reported.
He was replying to a question from his lawyer, Sanjay Mohan, during the trial of 1MDB’s US$6.59 billion lawsuit against him and its former chairman Irwan Serigar Abdullah.
When asked by 1MDB’s counsel Lim Chee Wee whether he was aware of the US$700 million transferred to Good Star Ltd as the company’s president and director, Arul Kanda said he became aware of it in 2016, but not before that.
He also said he only found out that fugitive financier Low Taek Jho, or Jho Low, was the beneficiary owner of Good Star through an auditor-general report that was released in 2009.
The US$700 million transaction occurred in 2009, six years before Arul Kanda was appointed CEO.
Lim: Have you, with your knowledge, instructed lawyers to pursue the recovery of the US$700 million?
Arul Kanda: It’s a bit speculative, but yes, I agree, if I had done that at that time, yes, it may be possible that we would have recovered this money.
In May 2021, 1MDB filed a lawsuit accusing Arul Kanda and Irwan of breach of trust and conspiracy, which led to losses of US$1.83 billion, linked to the company’s investment in 1MDB-Petrosaudi Ltd, which was subsequently converted into the Brazen Sky Ltd investment, purportedly recoverable from the Bridge Global Fund.
1MDB also alleged that the pair committed breach of trust and conspiracy by misappropriating US$3.5 billion in company funds paid to Aabar Investments and US$1.265 billion paid to the International Petroleum Investment Company on May 9, 2017.
1MDB further alleged that Irwan conspired with Arul Kanda to extend his employment agreement, resulting in a payment of RM2,905,200 to the latter, all the while disregarding the company’s interests, which ultimately led to financial losses and damages.
The company is seeking US$6.59 billion in damages from both defendants and an additional RM2.9 million from Irwan related to the extension of the employment agreement.
The hearing before Justice Raja Ahmad Mohzanuddin Shah Raja Mohzan resumes tomorrow.