US Ramps Up Criminal Investigation into Malaysia’s 1MDB Scam
US law enforcement is intensifying a criminal investigation into a multi-billion dollar alleged fraud at Malaysian sovereign wealth fund 1Malaysia Development Berhad (1MBD), Bloomberg reported Thursday.
The news agency reported that the US Department of Justice had asked a judge in Los Angeles to temporarily halt civil forfeiture lawsuits launched by the department against people tied to the alleged scam, saying the cases could get in way of the burgeoning criminal investigation.
The US had previously filed a series of civil cases seeking to seize US$ 1.7 billion in allegedly ill-gotten assets acquired in the US by key individuals including Malaysian financier Low Taek Jho, also known as Jho Low, and Riza Aziz, the stepson of Malaysian Prime Minister Najib Razak.
In a declaration included in Justice Department’s latest filings, a Federal Bureau of Investigation (FBI) agent warned that information in the civil cases may reveal "potential targets and subjects of the investigation and the investigative techniques that have been and will be used in the investigation," Bloomberg reported.
"Such disclosures could result in the destruction of evidence, flight of potential subjects and targets, or the identification and intimidation of potential witnesses," according to the agent’s declaration.
Several high-level officials and their associates are accused of having stolen more than $4.5 billion from 1MBD, a Malaysian state investment fund created by Prime Minister Najib.
They allegedly laundered the money through a series of complex transactions and shell companies with bank accounts located in Singapore, Switzerland, Luxembourg and the US, before investing it in various assets.
According to the Justice Department, the suspects in 2009 siphoned about US$ 1 billion that was intended to be invested in energy concessions owned by a foreign partner. In 2012 and 2013, $2.5 billion in funds raised through bond offerings was allegedly embezzled. In 2014, US$ 850 million in loans was allegedly diverted to several offshore shell entities.
Among other things, the money was spent on luxury real estate, a $35 million jet, works of art by Vincent Van Gogh and Claude Monet, and production of the 2013 film The Wolf of Wall Street.