Thursday, September 2, 2021

1MDB paid Bloomberg to list one of its funds, witness tells court

Former 1MDB CEO says this was to improve the poor public perception of the investment portfolio.

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Former 1MDB CEO Mohd Hazem Abdul Rahman told the High Court in Kuala Lumpur today that the company had paid international news agency Bloomberg to list one of its funds to improve the poor public perception of the investment portfolio.

Hazem, 49, said this during cross-examination by Najib Razak’s counsel Tania Scivetti at the former prime minister’s trial on the misappropriation of RM2.3 billion from 1MDB funds.

The 10th prosecution witness agreed with the suggestion by the lawyer that listing the Bridge Global Absolute Return Fund (BGARF) on Bloomberg would improve issues of legitimacy with the portfolio.

It was reported in 2016 that 1MDB had selected Bridge Partners Investment Management (Cayman) Ltd to manage US$2.3 billion (RM7.67 billion) of its cash. The money was invested in BGARF, a Cayman Islands-registered segregated portfolio company (SPC).

Hazem was referring to the minutes of a board meeting where the 1MDB chairman had commented on the poor perception of the fund.

The witness agreed that he had comforted the chairman in the meeting and said that the perception would improve once BGARF was listed on Bloomberg.

Scivetti: Bloomberg is a big name and has a platform to put financial data of a company, that’s why it is important to be listed on Bloomberg.

Hazem: Yes.

Scivetti: If you are listed on Bloomberg, it would give legitimacy to funds and would resolve issues of legitimacy.

Hazem: Yes.

Scivetti: I know, it is not difficult to list. All you have to do is pay a small subscription fee, which is not pricey at all. It is as simple as that. Bloomberg doesn’t verify what the company is saying about themselves to get listed. You pay them, they put it on.

Hazem: I don’t know. I cannot answer on behalf of Bloomberg.

Scivetti then suggested that being listed on Bloomberg did not guarantee any value in the said company, to which Hazem answered: “Yes, to a certain extent.”

Najib, 68, is facing four charges of using his position to obtain bribes totalling RM2.3 billion from 1MDB funds and 21 charges of money laundering involving the same amount.

The trial before judge Collin Lawrence Sequerah continues on Monday.

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