ABU Dhabi’s sovereign fund has given Malaysian state investor 1Malaysia Development Bhd (1MDB) five days to make the US$600 million (RM2.6 billion) payment it missed yesterday, failing which 1MDB will “become subject to additional obligations”, in a statement reported by Reuters today.

Mubadala, which now owns International Petroleum Investment Co (IPIC) issued the statement today, presumably in response to 1MDB’s promise to make the payment “later this month” after 1MDB received the funds it was due.

“Under the Settlement, there is a five business day cure period for MOF and 1MDB to remedy their non-payment before MOF and 1MDB become subject to additional obligations to IPIC and Aabar,” Mubadala said.

Mubadala did not specify what these additional obligations would entail.

1MDB agreed in April after private arbitration to pay IPIC US$1.2 billion in two instalments by the end of the year. 1MDB and the Finance Ministry also assumed responsibility for all future interest and principal payments under two bonds, worth US$3.5 billion in total.

1MDB is the brainchild of Prime Minister Najib Razak, who also chaired its advisory board. 

The state investor is reported to have racked up to RM50 billion in debts. Singapore has convicted bankers associated with 1MDB of money laundering and other charges, while the US Department of Justice has filed several civil forfeiture suits to seize billions of ringgit worth of assets allegedly bought with money stolen from 1MDB.

Among the assets the DoJ has filed to seize in its civil forfeiture suits are prime real estate in the US, rare paintings, a yacht, and the necklace with the infamous pink diamond that was allegedly presented to the wife of “Malaysian Official 1”, or MO1, which a minister in the Prime Minister’s Department has confirmed to be Najib. – August 2, 2017.