THE Kuala Lumpur High Court today allowed the government’s application for an interim order to block PetroSaudi International Ltd (PSI) and its director, Tarek Obaid, from moving more than US$340 million (RM1.4 billion), linked to 1Malaysia Development Bhd (1MDB) and kept in a client’s account at a UK law firm, to other entities.

Judge Mohd Nazlan Mohd Ghazali ruled that the court has jurisdiction to grant the interim preservation order sought by the prosecution.

“I now grant the request, which will be enforced until the disposal of the main application,” he said, also fixing August 28 to hear the application.

Nazlan made the ruling after hearing submissions by deputy public prosecutors Budiman Lufti Mohamed and Muhammad Izzat Fauzan on behalf of the government, and lawyers Mohd Yusof Zainal Abiden for Tarek Obaid, and Alex Tan representing PetroSaudi Oil Services (Venezuela) (PSOS-VZ).

In the application filed on July 10, the government applied for a prohibition order to restrain any dealings of the monies  amounting to US$340, 258,246.87 belonging to PSI and its subsidiary, PSOS-VZ, held in Clyde & Co LLP.

The government is also seeking unspecified money that was deposited under an intermediate account named Temple Fiduciary Services Limited, at Barclays Bank in the UK.

Both the specified and unspecified monies belonged to PSOS-VZ, which was wholly owned by Tarek through PSI. 

The application, filed under Section 53 of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act, named Tarek, PSI, PSOS-VZ, Clyde & Co and Temple Fiduciary as the first to the fifth respondent, respectively.

Earlier, Budiman informed the court that the prosecution applied for the ad-interim order following an arbitration decision last Friday, where the arbitrator ruled in favour of PSOS-VZ.

“Once the money has been released and dispersed to the third respondent (PSOS-VZ), there is nothing to do for the government to seek the money from the respondents,” he said.

Yusof and Alex both objected to the public prosecutor’s request for the ad-interim injunction, with the former saying he was not sure whether the court had such provisions to grant the temporary order to the prosecution.

Meanwhile, Tan said the prosecution was fully aware of the arbitration proceedings in UK and they had communicated with the UK authorities, but proceeded to file the application last week.

“I cannot see any basis for the court to issue the temporary order,” he said.

The prosecution filed the application, which was supported by an affidavit affirmed by Malaysian Anti-Corruption Commission (MACC) investigating officer Mohd Afiq Ab Aziz.

Afiq said he was one of the investigating officers responsible for the 1MDB investigation and, in the course of his duty, had uncovered information that led him to reasonably believe and suspect that the assets being held or deposited abroad were proceeds from illegal activities. 

He said he had reasonable grounds to believe that the US$340 million as at February 2019, currently held in the escrow account of Clyde & Co on behalf of PSOS-VZ, formed part of the subject matter or evidence in connection with the conspiracy to defraud or fraud 1MDB and its subsidiaries, with the involvement of former prime minister Najib Razak, Tarek, fugitive businessman Low Taek Jho and other related individuals. 

“I also have reasons to believe that there are other bank accounts that form part of the subject matter or evidence in connection with the scheme to defraud 1MDB. The bank account that I am referring to is the bank account under the name and/or managed by Temple Fiduciary Services Limited on behalf of the third respondent (PSOS-VZ),” he said.

Afiq said the application under the Act to block the monies was appropriate until such a time that the court could definitively determine whether the monies rightfully belonged to 1MDB. – Bernama, July 16, 2020.