Explainer-How Malaysia is seeking to recover billions of dollars missing from 1MDB



© Reuters. FILE PHOTO: Men walk past a 1 Malaysia Development Berhad (1MDB) billboard at the fund’s flagship Tun Razak Exchange development in Kuala Lumpur March 1, 2015. REUTERS/Olivia Harris

KUALA LUMPUR (Reuters) – Malaysia on Monday announced 22 civil suits against entities and people accused of being involved with the massive 1MDB corruption scandal, including units of global banks Deutsche Bank (DE:) and JPMorgan (NYSE:).

The lawsuits are part of a years-long effort by Malaysia to recover billions of dollars missing from 1Malaysia Development Berhad (1MDB) in a scandal that has implicated high-level officials, banks and financial institutions around the world.

WHAT IS 1MDB?

1MDB was a sovereign fund set up by former Malaysian prime minister Najib Razak in 2009 to promote economic development.

HOW DID BILLIONS GO MISSING?

1MDB raised billions of dollars in bonds, ostensibly for investment projects and joint ventures, between 2009 and 2013.

Malaysian and U.S. authorities say $4.5 billion was stolen from 1MDB by high-ranking officials of the fund and their associates between 2009 and 2014, and used to buy luxury assets and real estate.

Malaysian authorities have said at least $4.3 billion more is unaccounted for.

In September, the government said 1MDB still had an estimated $7.8 billion in outstanding debt.

HOW MUCH HAS BEEN RECOVERED?

Malaysia said in September it had recovered about $3.24 billion in assets linked to 1MDB’s financial trail so far.

The amount includes about 2.6 billion ringgit ($628 million) in cash and assets recovered and returned to Malaysia by U.S. authorities, as well as $2.5 billion paid by Goldman Sachs (NYSE:) to settle a Malaysian probe into the investment bank’s role in the 1MDB scandal.

READ  Week ahead: Trade talks, Fed, US jobs, Apple

Goldman, which helped raise billions for 1MDB, has also promised to help Malaysia recover assets worth $1.4 billion as part of a settlement last year.

The government reached similar settlements this year with Malaysian banking group AmBank and audit firm Deloitte, which have agreed to pay $700 million and $80 million, respectively.

HOW MUCH MORE IS STILL BEING SOUGHT?

Malaysia said on Monday the latest lawsuits were aimed at recovering assets worth in excess of $23 billion.

This included $1.11 billion from Deutsche Bank (Malaysia) Bhd, $800 million from JPMorgan (Switzerland) Ltd, $1.03 billion from a Swiss-based unit of private bank Coutts & Co, and interest payments from all of them, according to court documents seen by Reuters.

Malaysian business daily The Edge, which first reported the suits, also said those being sued over 1MDB include former premier Najib.

Last year, Najib was found guilty of corruption and money laundering in a 1MDB-linked case. He has consistently denied wrongdoing and is appealing the verdict.

($1 = 4.1135 ringgit)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

READ  UK scientists say further easing of COVID rules won't overwhelm health service





READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here