THE US Department of Justice has moved to seize another US$540 million (RM2.3 billion) in assets it says was bought with money stolen from Malaysia’s state investment fund 1Malaysia Development Bhd (1MDB), bringing the total alleged misappropriated figure to US$4.5 billion.

In its third and latest civil forfeiture suit filing, the DoJ seeks to seize, among others, a US$165 million yacht (RM704 million) the Equanimity, owned by Jho Low, and rights to comedy movie ‘Dumb and Dumber To’ produced by Red Granite, a production house co-owned by Riza Aziz, the stepson of Prime Minister Najib Razak.

The department also alleged in its suit that at least US$27.3 million was used by Low to buy a 22-carat pink diamond pendant and necklace for the “Malaysian Official 1’s wife”.

“Today’s complaints reveal another chapter of this multi-year, multi-billion-dollar fraud scheme, bringing the total identified stolen proceeds to $4.5 billion,” acting US Assistant Attorney General Kenneth Blanco said in a statement.

“This money financed the lavish lifestyles of the alleged co-conspirators at the expense and detriment of the Malaysian people.”

In court papers filed yesterday in Los Angeles, federal prosecutors said that in 2014, the Malaysian businessman Jho Low stole $850 million from funds borrowed from a syndicate of banks, ostensibly meant to repay options on bonds issued in a prior phase of the embezzlement scheme.

Instead, however, the money went to purchase the Equanimity.

Conspirators also bought a US$3.2 million work by Picasso and a $9.2 million Basquiat, according to the Justice Department.

This recent move follows last year’s civil asset forfeiture suit against US$1 billion worth of assets it alleged were similarly acquired. Some of the properties also belonged to Low, the man US investigators say is at the centre of alleged fraudulent transactions within 1MDB. Low has denied wrongdoing.

Malaysian Attorney-General Mohamed Apandi Ali acknowledged the latest suit while expressing frustration at the US prosecutors’ failure to alert his chambers to the filing of the suit.

He also said the AGC had yet to be given any proof that money had indeed been stolen from 1MDB from any of the investigations that had been initiated around the world against the state investment fund.

1MDB, incepted by Prime Minister Najib Razak in his first year in office in 2009, has racked up RM42 billion in debts after posting a RM425 million profit in its first year of operation, between September 2009 and March 2010.

It emerged that all was not well in 1MDB in 2015 when the Wall Street Journal reported that billions of ringgit went into the bank account of the prime minister, who has subsequently been cleared of all wrongdoing by the AG.

Nevertheless, the expose launched international investigations into the Malaysian state investment fund, with countries like Switzerland and Singapore weighing in on the scandal.

Singapore has shuttered the branches of two Swiss banks – Falcon and BSI – for laundering money allegedly stolen from 1MDB, and fined UBS and DBS for breaching anti-money laundering laws. Five former bankers in Singapore have been fined and jailed for their roles in the illegal movement of 1MDB funds.

In Switzerland, Coutts Bank was also fined for laundering funds linked to 1MDB. 

The US DoJ made history in July last year when it filed to seize about US$1 billion of assets allegedly stolen from 1MDB. It was the largest case under its kleptocracy asset recovery initiative, and a record that will be augmented by yesterday’s bid to seize US$540 million more of assets in the continuing 1MDB saga. – June 16, 2017.