SRC: Suit served on all defendants, except ex-CEO Nik Faisal

SRC International, under its new management, on May 7, has filed a lawsuit against former prime minister, Datuk Seri Najib Tun Razak, and six others, for alleged breach of trust and breach of statutory duty in relation to the RM4 billion Kumpulan Wang Persaraan Diperbadankan (KWAP) loan to SRC.

According to a counsel from the Rosli Dahlan Saravana Partnership, representing SRC, the writ of summons had been served on Najib and five former SRC directors, namely, Datuk Suboh Md Yassin, Datuk Mohammed Azhar Osman Khairuddin, Shahrol Azral Ibrahim Halmi, Tan Sri Ismee Ismail and Datuk Che Abdullah@Rashidi Che Omar.

"The writs were served on all defendants except the third defendant (Nik Faisal) as he is no longer in Malaysia," said the counsel after a case management today, which was conducted online before High Court Judge, Datuk Ahmad Fairuz Zainol Abidin.

The counsel also said that the writ of summons will be served to Nik Faisal by way of substituted service, and the court fixed Aug 3 for the next case management for the plaintiff (SRC), to update the court on the substituted service.

COURT-SRC 2 (LAST) KUALA LUMPUR

Under Order 62, Rule 5 of the Rules of Court 2012, substituted service is an indirect method available to serve cause papers on an individual who is allegedly evading service, or if it is impractical to serve the papers on the person.

SRC, which is a subsidiary of 1Malaysia Development Berhad (1MDB), as the plaintiff, in the writ of summons, alleged that all the defendants conspired and committed a breach of trust besides claiming that the former prime minister had abused his power and obtained personal benefits from SRC funds as well as misappropriated the funds.

Najib was the Advisor Emeritus of SRC from May 1, 2012, to March 4, 2019.

SRC, which is now wholly owned by the Ministry of Finance Incorporated (MoF Inc) is seeking a declaration that all the defendants are liable to pay the loss of investment funds as a result of the use of the loan amount in addition to claiming general damages, exemplary, additional and interest, costs and other appropriate relief provided by the court.

SRC, in its writ of summons, said that in January 2019, the company was placed under the care of officials from the Ministry of Finance (new management) and, after scrutinising and reviewing SRC records, found that SRC's previous directors had not taken any reasonable steps to ensure KWAP's loans amounting to RM4 billion to SRC in 2011 and 2012 were used properly to finance the company's general investment activities and general working capital requirements.

The company claimed that the previous directors did not monitor the disposal of RM3.6 billion to SRC BVI (proposed investment fund) allegedly for SRC to undertake investment activities in the energy resource sector overseas and failed to monitor the Malaysian government's exposure to guarantees given to SRC as well as failed to inquire about the misappropriation of SRC funds.

"The new management also found that a large number of withdrawals, transfers and use of KWAP loans were fraudulent or wrong," the company said in its writ of summons.