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US conducting criminal probe on 1MDB

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Written by Syndicated News

KUALA LUMPUR — August 11, 2017: The U.S. Justice Department is conducting a criminal probe into 1Malaysia Development Berhad (1MDB) and has asked for a stay on its civil lawsuits in connection with $1.7 billion in assets allegedly bought with money stolen from the scandal-hit state fund.

Reuters reported that according to dozens of civil lawsuits filed by the department in the past two years, a total of US$4.5 billion was misappropriated from 1MDB by high-level officials of the fund and their associates, 

1MDB did not immediately respond to an emailed request by Reuters for comment.

The department wants to delay the civil proceedings, saying that any disclosures would have an adverse effect on the government’s ability to conduct its criminal probe, according to the latest court filing lodged at the Central District Court in California yesterday.

The criminal investigation was started before the civil lawsuits, the department said. It said the investigation was global in scope, with crimes committed over several years in numerous countries.

In a declaration included in the filing, a Federal Bureau of Investigation agent said that disclosures were likely to reveal potential targets and subjects of the investigation.

“Such disclosures could result in the destruction of evidence, flight of potential subjects and targets, or the identification and intimidation of potential witnesses,” the agent said.

The Malaysian fund, founded by Prime Minister Datuk Seri Najib Razak, is facing money laundering probes in at least six countries including the United States, Switzerland and Singapore.

In its civil lawsuits, the department sought to seize about $1.7 billion in assets that it said were bought with misappropriated 1MDB funds.

They include a private jet, a hotel and real estate in New York, and a US$107 million interest in EMI Music Publishing purchased by Malaysian financier Low Taek Jho, or Jho Low, the department said.

Low is also accused in the lawsuits of gifting Hollywood actor Leonardo DiCaprio a US$3.2 million Picasso painting and buying about US$9 million in jewelry for Australian model Miranda Kerr.

Najib has denied any wrongdoing and a Malaysian government investigation has cleared him of any charges.

A representative for Low, whose whereabouts are unknown, did not immediately respond to an emailed request by Reuters for comment. Low has previously denied wrongdoing, saying that the department’s actions were a further example of global overreach in pursuit of a deeply flawed case.

Bernama reported that 1MDB today said pursuant to the amendment dated August 8  to the settlement deed with Minister of Finance (Incorporated) Malaysia and the International Petroleum Investment Company PJSC (IPIC), it has to-date remitted US$360 million.

The balance of the original July 31, 2017, payment obligation to IPIC is accordingly now due on this August 31.

The company reiterated that all funds paid to IPIC were from proceeds of the on-going rationalisation programme.

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