Asia

Malaysia claims RM96.6 billion from those who allegedly defrauded 1MDB

KUALA LUMPUR – Malaysia is claiming more than RM96.6 billion (S$31.2 billion) from a number of individuals, including former premier Najib Razak, banks, and various firms involved in the financial scandal at state investment firm, 1MDB.

The Finance Ministry said on Monday (April 10) 22 different claims were filed in court on April 7 on behalf of the state-owned firm and its former subsidiary, SRC International, both of which were the centre of the scandal that reverberated around the world following revelations in 2015 that RM2.6 billion from 1MDB found their way into Najib’s personal accounts. He was premier then.

Nearly 40 individuals and 17 entities were among those named in the suits. The financial daily, The Edge, reported that they included former top 1MDB officials such as ex-chief executives Shahrol Halmi and Arul Kanda Kandasamy as well as fugitive businessman Low Taek Jho, who is widely regarded as the mastermind of the alleged fraud at 1MDB, and members of his family and inner circle.

The likes of Deutsche Bank (Malaysia), Swiss bank Coutts & Co as well as JP Morgan (Switzerland) were also accused of facilitating deals which led to billions being siphoned from taxpayers.

“Some people are having doubts about the 1MDB scandal, but not this government. We will pursue all wrongdoers until Malaysians get justice,” Datuk Wan Saiful Wan Jan, information chief for Prime Minister Muhyiddin Yassin’s Parti Pribumi Bersatu Malaysia, told The Straits Times.

The civil suits filed last Friday are separate from ongoing criminal trials into alleged graft aimed at some of the same individuals.

Najib – who lost his grip on power after Umno and the coalition it led was part of suffered its first ever election loss in six decades in 2018 – has already been convicted for abuse of power in connection with approving a RM4 billion loan from the civil service pension fund, RM42 million of which ended up in his bank account.

He is currently appealing a 12-year sentence and RM210 million fine.

The amount being claimed by the Muhyiddin government in the suits is far in excess of any estimate of lost funds, or even the peak level of debt – over RM50 billion – that once saddled 1MDB.

Since coming to power in March last year, the Perikatan Nasional (PN) administration has pursued settlements with various firms involved with 1MDB, and so far has recovered close to RM20 billion.

“Following significant and successful settlements with Goldman Sachs, AmBank Group and Deloitte PLT, the Government’s recovery efforts are now focused on pursuing other wrongdoers who have caused losses to 1MDB and/or SRC during the execution of their duties.

“The government will not rest until all those involved are made fully accountable for the wrongdoings caused to the country through their involvement in 1MDB and/or SRC,” said Finance Minister Tengku Zafrul Aziz.

The PN government has also gone ahead with seizures of alleged embezzled funds from 1MDB and SRC that began under the previous Pakatan Harapan administration in 2018, although several such moves have been overturned in court. A number of the seizures involve the accounts of Umno branches and leaders.

Umno is part of Mr Muhyiddin’s ruling pact but in recent months has declared it would part ways once an election is called, as it seeks to reclaim its dominance of Malaysian politics.

The premier has promised fresh polls once an emergency declared amid the ongoing Covid-19 pandemic is lifted by August.

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