Malaysia’s PAS Backs out of Libel Suit, Pays Off

Malaysia’s fundamentalist-based Parti Islam se-Malaysia, or PAS, has quietly paid RM1.423 million (US$350,000) in expenses to get out of a libel suit it filed against the crusading Sarawak Report and its editor Clare Rewcastle Brown.

The confidential out-of-court settlement was signed on Jan. 24, agreeing that Sarawak Report’s legal bills in a London court would be paid to allow Abdul Hadi Awang, the PAS leader, to withdraw from the case without facing cross-examination by Brown’s lawyers.

Rewcastle Brown and Sarawak Report played a pivotal role with scores of articles over a three-year period that exposed the details of the government-backed investment fund 1Malaysia Development Bhd scandal, in which billions of US dollars disappeared overseas into US real estate, paintings, airplanes, gambling debts and other assets controlled by now-disgraced former Prime Minister Najib Razak, his wife and his allies. Najib has since been arrested along with his wife and top officials of the United Malays National Organization in the wake of the May 9, 2018 election that brought the Pakatan Harapan coalition headed by now-Prime Minister Mahathir Mohamad to power.

Hadi filed the defamation suit in a London court in April of 2017 over a report that he had received money from UMNO in exchange for an agreement with Najib to align with the government in the coming election, which Pakatan Harapan coalition won in a landslide. Disgust over corruption in UMNO that was publicized by Sarawak Report were instrumental in the election defeat.

Rewcastle Brown refused a demand from Hadi’s lawyers to withdraw the article alleging the payment, leading to the defamation suit. The payment by PAS and the agreement on the part of Hadi to withdraw from the case constitutes a major embarrassment for PAS because it appears to be an admission that the story was true.

The Sarawak Report said it was approached with an offer for an out-of-court settlement by a PAS intermediary late last year. Extensive negotiations with the intermediary followed. Eventually, Hadi and his advisors in PAS agreed on terms that included the payment, at which point the intermediary, a lawyer and another PAS supporter visited SR’s KL lawyer on January 24th to finalize the terms. The PAS representatives offered to make the payment in cash, which Rewcastle Brown’s representatives wisely refused.

Sarawak Report said it had agreed to a request by Hadi’s lawyers that the payment would remain confidential. According to a statement by Rewcastle Brown’s lawyers, the agreement “did not oblige Sarawak Report to provide any of the remedies sought in Hadi’s claim, such as keeping silent on the subject of UMNO payments to PAS or anything else, since Sarawak Report had refused to apologize for its remarks or to surrender its commitment to fair reporting in the public interest.

In a Feb. 28 statement on the Sarawak Report website, Rewcastle Brown said she had decided to publicize the settlement and display the check paid in escrow to her Malaysia-based lawyer, Americk Sidhu, because “PAS has sought to spin and deceive over the matter. In the process senior PAS officials have referred to lying in the political interests of the party as permissible under a surprising interpretation of Sharia law. It has been implied that Sarawak Report backed out of the case, lied and said things it never claimed.”

Hadi’s representatives in PAS, she wrote, “have repeatedly broken the obligation imposed on Hadi to keep confidentiality about the terms of the settlement, by not only speaking about those terms but also misleading Malaysians by stating that no payment was made to Sarawak Report in settlement of the claim. It was.”

PAS secretary general Takiyuddin Hassan, according to the story, denied a query over the payment, saying neither Hadi nor the party had paid any costs. Takiyuddin was quoted on the Malaysiakini news portal as saying: “In other words, the claimant Hadi does not make any payment of costs to the defendant to settle the case out of court. It should also be clarified that PAS does not make any payment for any part of this case, because PAS was not a party to the suit.”

Takiyuddin later announced that he would call a press conference at which he said he would provide documents to prove that Sarawak Report had received no payment to settle the case.

Because of statements by Takiyuddin and others, Rewcastle Brown wrote, in a statement vetted by lawyers in Kuala Lumpur and London: “Sarawak Report therefore is entitled to consider itself released from confidentiality also, in order to be able to tell the truth to the Malaysian people who are being misled. There are no documents ‘proving Sarawak Report was not paid’, to the contrary there is copious evidence showing we were paid by agents of Hadi Awang to allow him to withdraw his claim.

In addition to printing a copy of the check to Americk Sidhu, Rewcastle Brown printed a letter Malayan Banking Bhd showing that Sarawak Report, in compliance with international money-laundering rules, explained the export from Malaysia of the equivalent of £260,000 pounds sterling (RM1.422, 980.00) from Malaysia back to London. Attached to this letter was a copy of the confidential settlement and the court order.

“PAS and Hadi Awang plainly wish to find every way to distance themselves from the fact they paid to gain a discontinuance of the case and avoid trial,” Brown wrote. “However, the recent public statements are once again misleading Malaysians into an understanding that Sarawak Report was not paid and itself backed down from defending its position, which is untrue. In the process they have broken the terms of an agreement they themselves imposed not to discuss the terms of the settlement, and therefore Sarawak Report is entitled to reveal the truth to the Malaysian public and hopes this will draw a line under the affair.”