The High Court in Kuala Lumpur today was told that only after nearly seven years, Bank Negara Malaysia (BNM) found that US$700 million belonging to 1MDB went into the wrong entity, namely Good Star Ltd, a company owned by fugitive businessman Low Taek Jho, or Jho Low.

Former BNM governor Zeti Akhtar Aziz, 76, also admitted that it took a long time to discover the matter as it was a lengthy process to follow the money trail.

The 46th prosecution witness said this when asked by Najib Razak's lead counsel Muhammad Shafee Abdullah at the former prime minister's trial involving the misappropriation of RM2.3 billion of 1MDB funds.

The court had been told earlier that the US$700 million transaction occurred in 2009, and the authorities discovered it in 2015.

Shafee: Tan Sri, only after nearly seven years did all authorities realise that the money went into Jho Low’s entity?

Zeti: Correct.

Shafee: Was it not a long period to discover that the money went to the wrong entity?

Zeti: It is very common. I was told by financial authorities all over the world that it takes many years to uncover and detect such wrongdoings.

Zeti: Yes, the transaction occurred in 2009, and we found out in 2015, but that doesn't mean that BNM didn't do any follow-up. We have sent several letters and emails to 1MDB. We asked about the status of the US$1 billion investment.

Zeti: But none was forthcoming, and that was why, in 2014, when 1MDB applied for more money, BNM rejected its application because the indebtedness kept on increasing; therefore, the central bank rejected its application.

She added that the central bank had to undertake a multi-year investigation after 1MDB officials failed to provide satisfactory answers on what happened to the funds sent overseas in 2009.

Shafee: Tan Sri, could BNM have determined the owner of the account before the approval of the transaction?

Zeti: No, it is another jurisdiction, and it takes time to find out who the owner is.

She also pointed out that it was not the BNM's role to conduct due diligence on the transaction and that it was clearly the function of the financial institution.

Najib, 70, faces four charges of using his position to obtain bribes amounting to RM2.3 billion belonging to 1MDB and 21 charges of money laundering involving the same amount.

The trial before judge Collin Lawrence Sequerah continues.