By LOUISE STORY
New York Times
JULY 20, 2016

The United States government plans to move Wednesday to seize more than $1 billion in assets purchased with money that it believes was stolen from a Malaysian sovereign wealth fund by people close to the country’s embattled prime minister.

Hidden in the United States in real estate, art and other luxury goods, the money was embezzled from the fund and moved around the world using secretive shell companies that masked its trail, a person familiar with the Justice Department plan said.

The $1 billion that prosecutors will allege was laundered in the United States is but a portion of the billions that international investigators suspect was siphoned off by high-level officials at the fund and their associates. The fund — called 1Malaysia Development Berhad, or 1MDB — is overseen by the prime minister, Najib Razak, and has become a focus of rising popular discontent with Mr. Najib’s government amid several investigations at home and abroad.

The forfeiture complaint, to be issued by a unit known as the Kleptocracy Asset Recovery Initiative, will be the largest such case brought by the Justice Department. The United States is among several governments, including Malaysia, Singapore and Switzerland, that have investigated the fund. Read the rest of this entry »

Did the Cabinet this morning discuss the breaking news at about noon Malaysian time of the Wall Street Journal (WSJ) report that the US authorities are set to seize assets linked to 1MDB “in the largest asset seizure in US history” in the war against global corruption?

This seizure, under the US Kleptocracy Asset Recovery Initiative, is expected to exceed the previous record of US$850 million in assets which the US authorities sought to seize from three telecom firms in an unrelated case.

Citing sources, WSJ said the Justice Department’s Kleptocracy Asset Recovery Initiative is expected to file civil lawsuits seeking to seize the assets as soon as Wednesday morning in the US.

It claimed the seizure will involve properties and other assets bought with “money allegedly misappropriated from the Malaysian fund.” Read the rest of this entry »

Shamim Adam and Laurence Arnold
Bloomberg
July 20, 2016

Malaysia’s state-owned investment fund, 1MDB, was supposed to attract foreign investment. Instead, it has spurred criminal and regulatory investigations around the world that have cast an unflattering spotlight on financial deal-making, election spending and political patronage under Prime Minister Najib Razak. A Malaysian parliamentary committee identified at least $4.2 billion in irregular transactions.

1. What is 1MDB?

It’s a government investment company — full name, 1Malaysia Development Berhad — that took shape in 2009 under Najib, who went on to lead its advisory board. Its early initiatives included buying privately owned power plants and planning a new financial district in Kuala Lumpur. The fund proved better at borrowing — it accumulated $12 billion in debt — than at luring large-scale investment.

2. What’s the issue?

Investigators have been trying to trace whether money might have flowed through and around 1MDB and illegally into personal accounts. Some of the money is alleged to have ended up with Najib and his family. That includes $681 million that landed in the prime minister’s personal bank account, according to the Wall Street Journal. Najib has denied wrongdoing, and Malaysia’s attorney general said the $681 million was a donation from the Saudi Arabian royal family, much of which was returned. Another $700 million in 1MDB funds meant for a joint venture with a company known as PetroSaudi International was found to have landed in an unrelated offshore account. Read the rest of this entry »

By BRADLEY HOPE
Wall Street Journal
July 20, 2016

Authorities are expected to file civil lawsuits as soon as Wednesday

Federal prosecutors are poised to launch one of the largest asset seizures in U.S. history as they step up their investigation into billions of dollars siphoned away from a Malaysian government investment fund, according to people familiar with the matter.

Authorities are expected to file civil lawsuits as soon as Wednesday morning seeking to seize assets, which are expected to include properties and other assets purchased with money allegedly misappropriated from the Malaysian fund, according to people familiar with the matter.

The Wall Street Journal has reported that people linked to the fund have invested millions of dollars in real estate and businesses in the U.S.

Agents from the Federal Bureau of Investigation’s international corruption unit have also been conducting a wide-ranging criminal investigation into people and institutions connected with 1Malaysia Development Bhd., known as 1MDB, a sovereign-wealth fund set up by Prime Minister Najib Razak in 2009 to drive the country’s economy. Read the rest of this entry »

BY A. ANANTHALAKSHMI AND SAEED AZHAR
REUTERS
16th July 2016

Singapore’s central bank is scrutinizing several banks, including UBS (UBSG.S) and DBS Group Holdings (DBSM.SI), to see if they broke anti-money laundering rules in handling transactions linked to scandal-hit Malaysian state fund 1MDB, three people with knowledge of the matter said.

The Monetary Authority of Singapore (MAS) is looking at several aspects of the banks’ operations including whether they were diligent enough in knowing who their customers were and what the source of their funds was, and whether they were particularly careful in screening politically-exposed persons such as government officials, banking and legal sources aware of the review said.

The probe could lead to fines and other penalties if lapses are found, said the sources who declined to be identified due to the sensitivity of the matter. It is unclear which transactions by the banks are being examined.

Switzerland’s Falcon Private Bank and Coutts International, which is owned by Geneva-based Union Bancaire Privee, are also among the banks under review, they said.

UBS, Coutts, and DBS, which is Singapore’s top lender, all declined to comment. Read the rest of this entry »

The whistleblower site Sarawak Report today made a third consecutive-day revelation about the Auditor-General’s Report on 1MDB, which had been “conditionally” presented to the Public Accounts Committee (PAC) and was the basis of the PAC Report on 1MDB, but which was not presented to Parliament when the PAC Report on 1MDB was tabled in Parliament on April 7, on the ground that it was still classified under the Official Secrets Act (OSA).

There have been two official responses so far to Sarawak Report’s exposes of the Auditor-General’s Report on 1MDB – the call for investigations by the Minister for Communications and Multimedia, Datuk Seri Salleh Said Keruak for breach of the OSA on the ridiculous ground that the AG’s Report on 1MDB is classified for the purpose of “national security” and the confirmation by the Deputy Home Minister and former PAC Chairman, Datuk Nur Jazlan Mohamad that police are probing the Sarawak Report leak of the AG’s Report.

As DAP MP for PJ Utara and PAC Member, Tony Pua pointed out, the right thing to do at the moment is for the Auditor-General’s Report on 1MDB to be declassified and made public immediately, instead of allowing the Prime Minister, Datuk Seri Najib Razak and his administration to suffer the global attrition of what is left of its credibility and integrity not only among Malaysians but also internationally with the continued expose of the Auditor-General’s Report on the 1MDB about 1MDB’s global embezzlement, money-laundering and corruption.

The OSA classification of the Auditor-General’s Report on 1MDB went against the very spirit and intent of Najib’s directive in March 2015 to the Auditor-General to investigate 1MDB and submit its report to the PAC, and that the AG’s and PAC’s 1MDB Reports were meant to be final and conclusive measures in laying to rest all doubts about the 1MDB.

The very opposite has occurred – with the Auditor-General’s Report on 1MDB classified for fear that its publication would stir a hornets’ nest about 1MDB global embezzlement, money-laundering and corruption! Read the rest of this entry »

The two latest whistleblowing feats of website Sarawak Report have raised the disturbing question whether the Malaysian Parliament is the first in the world to be denied the opportunity and materials to decide whether its Public Accounts Committee (PAC) had done a proper and competent job, in its inquiry into the RM55 billion 1MDB scandal.

Yesterday, Sarawak Report published some of the contents of what it claimed was the Auditor-General’s report on 1MDB, which was submitted to the PAC on March 4 and was the basis of the PAC Report on 1MDB presented to Parliament on April 7, but the AG’s Report on 1MDB was not tabled in Parliament on the ground that it was classified under the Official Secrets Act (OSA).

Sarawak Report listed out the various concerns that auditor-general Tan Sri Ambrin Buang had pointed out in his report, especially with regard to several questionable fund transfers.

Sarawak Report said it will publish more details from the auditor-general’s report in the coming days.

Today, Sarawak Report made the revelation of another key document in the PAC probe on 1MDB, a letter from Bank Negara Malaysia to the PAC Chairman, Datuk Seri Hasan Arifin, related to its correspondence which among other things, confirmed Penang billionaire Jho Low was the sole owner of Good Star Limited, which had received US$1.03 billion from 1MDB. Read the rest of this entry »

Three days after his appointment as the new Second Finance Minister, Datuk Johari Abdul Ghani said he has made 1MDB one of his priorities and pledged to resolve the state investment fund’s problems transparently.

He promised that the government would address the issues raised in the Public Accounts Committee’s (PAC) report on 1MDB and said: “What had been raised in PAC report – whatever or whoever that caused (problems in) 1MDB – definitely action will be taken.

It speaks volumes that the new Second Finance Minister should be making such an assurance about the PAC Report on 1MDB which was submitted to Parliament on April 7, which could only mean that the Finance Ministry has yet to take seriously the recommendations of the PAC report although it had been made public for nearly three months on a financial scandal which had catapulted Malaysia to world attention for global corruption?

This is most shocking especially when the PAC Report on 1MDB only revealed the “tip of the iceberg” of the financial chicanery and fraud and global embezzlement, money-laundering and corruption which is now the subject of investigation by seven other countries, but despite its weak and minor recommendations, the Finance Ministry has yet to take full action to implement the PAC recommendations after the passage of nearly three months.

This shows that the Finance Ministry does not have the political will or capability to resolve the RM55 billion 1MDB global scandal and ensure full accountability to who is responsible, for the simple reason that the person who must bear the greatest responsibility of the nation’s first global scandal is none other than the Finance Minister himself – who happens to be the Prime Minister, Datuk Seri Najib Razak. Read the rest of this entry »

Simon Rowe
Irish Independent
19/06/2016

When a Wall Street star left under a cloud, the ‘smoking gun’ was a letter destined for our bad bank

A senior ex-Goldman Sachs banker who quit the Wall Street firm after being investigated over a falsified assurance letter – which, it is believed, he had sent to a European bank to assist a Malaysian tycoon’s bid to purchase property from Nama – has become embroiled in a $6bn global embezzlement probe.

Tim Leissner, who had close ties to the Malaysian sovereign wealth fund 1MDB and was considered Goldman Sach’s point man in Singapore dealing with the fund, was interviewed on January 19 this year in relation to “inaccurate and unauthorised statements” made by him in a June 2015 reference letter.

According to filings with the Financial Industry Regulatory Authority, the US securities industry’s self-regulating body, the letter was written without Goldman Sach’s knowledge or approval.

Sources close to the case said Leissner’s letter had included details about the finances of his client, who is believed to be well-known Malaysian tycoon Jho Low, while overstating the extent to which Goldman Sachs had done due diligence on him.

The letter, which vouched for Low and his finances to a financial institution in Europe, was to be used to help Low reach a deal to buy real estate from the National Asset Management Agency, it is believed. Read the rest of this entry »

by John Letzing
Wall Street Journal
June 23, 2016

BSI says Finma actions are “unlawful” and “disproportionate”

ZURICH—BSI SA, a Swiss bank embroiled in the legal controversy surrounding Malaysian state investment fund 1Malaysia Development Bhd., said on Thursday that it is appealing “flawed” actions taken against it by Switzerland’s financial regulator.

The Swiss regulator, Finma, issued a sternly worded statement in May, saying that BSI had committed “serious” breaches of money-laundering regulations in its dealings with the Malaysian fund, 1MDB, and had executed a number of large transactions for the fund “despite clearly suspicious indications.” Finma ordered BSI to pay 95 million Swiss francs ($99 million) in profits tied to its business with 1MDB to Switzerland’s public coffers.

Finma also said it was starting enforcement proceedings against two unidentified former managers at the Lugano-based bank.

On Thursday, BSI said Finma’s communication about actions taken against the bank “has severely harmed the reputation of the bank and its employees.” BSI added that it “challenges Finma’s assessment of the facts, and holds that the measures [Finma] ordered are unlawful and disproportionate.”

BSI said it has lodged its appeal with the Swiss Federal Administrative Court. A BSI spokesman declined to comment further on what remedies the bank is seeking.

A Finma spokesman said that its decisions can be challenged and are subject to judicial review, and declined to comment further. Read the rest of this entry »

The 1MDB Colloquium held in Sungai Besar and Kuala Kangsar on 11th and 12th June 2016 respectively, which was graced by many distinguished speakers have raised many pertinent issues with regards to the Government’s complete lack of accountability with 1MDB.

The recent global developments over 1MDB made it even more imperative for Dato’ Seri Najib Razak to explain what he has refused to explain for more than a year.

We, the undersigned, are citizens of Malaysia demanding clear and direct answers by the Prime Minister, Dato’ Seri Najib Razak and his Cabinet on the following pressing questions on 1Malaysia Development Bhd (1MDB) and Najib’s US$1 billion deposits into his personal bank account:

1. Who will pay if 1MDB loses the arbitration case with Abu Dhabi’s International Petroleum Investment Corporation (IPIC)?

On 14 June 2016, IPIC has filed its US$6.5 billion worth of claims against 1MDB in London’s Arbitration Court. IPIC is seeking US$3.5 billion bond plus interest that amounts to US$4.8 billion, the US$1.2 billion loan plus interest, and about US$481 million owed to its subsidiary, Aabar Investment PJS.

The above claims followed the discovery that 1MDB has made as much as US$3.5 billion of payments to a fraudulent British Virgin Island incorporated entity, Aabar Investment PJS Limited, which IPIC has denied ownership. Read the rest of this entry »