Tengku Rahimah Sultan Mahmood said she attended a dinner at Istana Terengganu on Jalan Kia Peng in Kuala Lumpur towards the end of 2008, with Najib also present.
Others who attended the dinner included former menteri besar Ahmad Said and Tengku Rahimah’s husband, Abdul Aziz Akhir.
She said her elder brother, the sultan, started a conversation about setting up the Terengganu Investment Authority (TIA), and that Najib had expanded on the topic.
“Yes, (Najib) could explain it on a macro level,” Tengku Rahimah said when asked by the prosecution about what had happened during the dinner.
Sultan Mizan was the Yang di-Pertuan Agong at the material time.
Tengku Rahimah also told the court that she assumed the position as TIA director in 2009, but resigned after two weeks.
Before her resignation, she said Sultan Mizan asked her to sign a resolution to suspend the issuance of the Islamic medium-term notes used to secure TIA’s RM5 billion loan.
“We were equally surprised and taken aback,” she added, referring to the other directors who were also present.
The court previously heard testimonies from former 1MDB director Ismee Ismail and then CEO Shahrol Azral Ibrahim Halmi about Sultan Mizan asking them to sign the suspension.
Shahrol said Sultan Mizan had looked angry that day.
‘Taib Mahmud’s son-in-law introduced Jho Low to me’
Tengku Rahimah also told the court that she met fugitive businessman Low Taek Jho in 2008 through the late Abdul Taib Mahmud’s son-in-law, Syed Ahmad Alwee Alsree.
She said she was impressed by Low’s personality, adding that he had mentioned his education background and business ventures.
Deputy public prosecutor Ahmad Akram Gharib then asked Tengku Rahimah whether Low mentioned to her that he had good ties with Najib.
Tengku Rahimah said Low did say so.
The hearing continues before Justice Collin Lawrence Sequerah.
Earlier today, the judge dismissed the defence’s bid to obtain statements recorded from witnesses in the 1MDB case.
Najib is standing trial on 25 charges of abuse of power and money laundering over funds amounting to RM2.28 billion which were deposited into his AmBank accounts between February 2011 and December 2014.