Jasmine Loo Admits That 1MDB-PSI Joint Venture Was A Fraud

After much prodding from defence counsel Tan Sri Shafee Abdullah, former 1MDB general counsel Jasmine Loo admitted that the joint-venture agreement between 1MDB and PSI was purely a scam

KUALA LUMPUR – The High Court was told today that the purported multi-billion joint venture agreement between 1Malaysia Development Berhad (1MDB) and PetroSaudi International Ltd (PSI) was purely a scam, giving rise to the question of why the witness, Jasmine Loo Ai Swan, who was also general-counsel for 1MDB then, did not do a thorough due diligence on PSI.

Loo also reluctantly agreed with the contention of defence counsel, Tan Sri Shafee Abdullah, that it was not the duty of former prime minister, Datuk Seri Najib Razak to ascertain that PSI was an authentic company registered in Saudi Arabia.

Testifying in Najib’s trial for allegedly misappropriating millions of 1MDB funds before presiding judge Datuk Collin Lawrence Sequerah, Loo said that former 1MDB chief executive, Datuk Shahrol Azral Ibrahim Halmi, admitted that he relied heavily on representations made by PSI itself before entering into a joint venture agreement (JVA with its holding company called PetroSaudi Holdings (Cayman) to form 1MDB PetroSaudi Ltd.

Jasmine Loo said that former 1MDB CEO, Datuk Shahrol Azral had admitted that he relied heavily on representations made by PSI itself before entering into the JV agreement - NMH filepic
Jasmine Loo said that former 1MDB CEO, Datuk Shahrol Azral had admitted that he relied heavily on representations made by PSI itself before entering into the JV agreement – NMH filepic

Under the JVA, which was signed on 28 Sept 2009, 1MDB ended up pumping in US$1 billion for a 40 per cent stake in the company while PetroSaudi Holdings (Cayman) injected its so-called assets worth US$2.7 billion for a 60 per cent stake.

Jasmine Loo: 1MDB Bosses Should Have Done Due Diligence

Loo also agreed with Shafee’s suggestion that 1MDB’s top brass should have conducted due diligence on PSI before pumping its fund into the JVA.

This is contrary to the Prosecution’s allegation that a fraudulent JVA between 1MDB and PSI, known as the Aria project, was established by the accused (Najib), with 1MDB purportedly borrowing US$1 billion to invest in 1MDB PetroSaudi Ltd.

She added that her knowledge regarding PSI at that time was solely based on documents provided, such as letters from the bank and information from Shahrol Azral.

In questioning the witness, Shafee pointed out that PSI was incorporated in the Seychelles, East Africa. He said there was no documentation to show that PSI existed in Saudi Arabia.

Shafee: Is it the duty of the prime minister to ascertain whether PSI actually exists n Saudi Arabia?

Loo: No.

Shafee: Is it the duty of 1MDB’s management or Wong & Partners (consulting company)?

Loo: Yes, One of them.

Shafee: Including you, because you were paid a lot.

Loo: Yes.

Con Job

Shafee: I put it to you PSI was a total con job, and you should have checked because a massive amount of money was channelled into it.

Loo: In hindsight, yes.

In 2019, Shahrol testified that the joint venture deal between 1MDB and PSI in 2009 was a failure.

Steal Money

On Nov 1, 2018, former PetroSaudi executive officer Xavier Andre Justo claimed that the JVA was purposefully done to steal money.

“The company was created by Tarek Obaid, one of my very best friends in 2005. This company has only one good asset … the name. It sounds like a Saudi government company.

“But from 2006 until the 1MDB money went into the PetroSaudi account, it was almost a non-existence company.

“In Geneva, they were hiring a part-time employee. I know that because he was stationed in my office.

“In Saudi Arabia, which was supposed to be the center of the business, there was only one guy picking up the phone while in London, three oilmen were paid part-time.

“So, the company almost did not exist until September 2009 when they did this famous joint venture with 1MDB,” he added. – NMH

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