Datuk Rosman Abdullah, who is director of Putrajaya Perdana Bhd (PPB), said he was picked up about 6.30pm on July 24, 2015.
"It was on the 8th day of Hari Raya Puasa. I was remanded for four days.
The 53-year old who was testifying in Datuk Seri Najib Razak's trial involving RM42 million of SRC International Bhd funds which were banked into his personal accounts, said:
"It was only during the questioning session I was told that SRC International is a government-owned company and that the bank accounts belonged to Najib."
Rosman said he was also shocked to learn that the graft busters suspected he was complicit in the transfer of funds to and from the accounts of SRC International and Najib.
However, Rosman said he explained to investigators that it was Jho Low who initiated and directed the transactions.
"Jho Low lied to me. I had no knowledge that SRC International was a government-linked company and that the AMBank accounts belonged to Najib..
"I was thereafter released and given letters of clearance by the MACC and also the Attorney general's Chambers," he said.
Rosman said he attempted to contact Jho Low and others associated with the Penang-born businessman but none of them responded.
Asked by Najib's lawyer Farhan Read how he considered Jho Low as a person, Rosman said prior to being arrested he always looked up to the latter as a competent and trustworthy businessman.
"We developed what seemed to me at that time to be a cordial professional relationship. I thought of him as a micro manager.
"Subsequent to my arrest, I now have a clearer picture of what happened in the RM170 million transfer episode. I would describe him as a highly smooth and effective scammer," he said.
Earlier, Rosman, who is a 70 per cent shareholder in PPB, said there were three companies implicated in the 1Malaysia Development Bhd (1MDB) scandal which were linked to PPB.
These included Putra Perdana Construction Sdn Bhd (PPC), Putra Perdana Development Sdn Bhd (PPD) and Permai Binaraya Sdn Bhd (PBSB).
He said although Jho Low had no official role in the PPB Group prior to his acquisition of the company in April 2015, the latter had all the while come across as though he controlled the companies.
"His conduct and statements gave me no reason to doubt that he was acting in the best interest of the companies," he said.
Rosman said Jho Low subsequently instructed him to open a bank account for PBSB in July 2014 and although he was one of the signatories, some specific instructions were given by Jho Low and his associate Jerome Lee.
These included the transfer of a total of RM170 million, including RM35 million on July 8, 2014, RM105 million (July 14, 2014) and RM30 million (August 8, 2014).
"Jho Low told me that the money was an advance for a contract he was negotiating.
"As he was still the beneficial owner of the PPB Group at that time, I did not think that I had a say in this as long as there was no eventual liability to the PPB Group when my buy-out was concluded," he said.
Rosman said he was later shocked to learn that the money had actually been transferred to Najib's accounts.
Najib, 67, is facing seven counts of power abuse, criminal breach of trust and money laundering in relation to RM42 million of SRC international money.
The trial before High Court Judge Mohd Nazlan Mohd Ghazali continues.