DesPardes + PKonweb

US Returns $57 Million in 1MDB Funds to Malaysia

DESPARDES News Report – Malaysia on Tuesday said the U.S. government had returned some $57 million in funds recovered from 1MDB assets in the “first instalment” of funds to be repatriated under a U.S. kleptocracy asset recovery initiative.

The US is to return close to $200 million to Malaysia in funds recovered from asset seizures tied to scandal-hit state fund 1MDB.

Malaysian Attorney-General Tommy Thomas announced yesterday that US$57 million has been banked into an asset recovery account the government set up for 1MDB. The money was part of the US$60 million forfeited by a US-headquartered company.

The Department of Justice (DoJ), in the biggest ever case in its anti-kleptocracy program, is pursuing billions of dollars it says were misappropriated from 1MDB, a state fund founded by former Malaysian prime minister Najib Razak.

The US$57 million repatriated to Malaysia was forfeited from Hollywood film production company Red Granite Pictures, which is linked to Najib’s stepson Riza Aziz, according to the Malaysian Attorney-General’s chambers (AGC).

The DoJ is also in the process of remitting another US$139 million, pending the sale of a Manhattan property linked to fugitive Malaysian financier, Low Taek Jho or Jho Low, the AGC said in a statement.

Malaysia aims to retrieve US$7 billion in misappropriated funds from 1MDB. The 1MDB, Malaysia’s beleaguered state-owned fund, had amassed debts of more than S$18 billion at its peak, according to the country’s declassified Auditor-General’s report.

Billions of dollars from 1MDB had gone missing during Razak rule- Razak was ousted last year thru ballot by Dr. Mohamid Mahathir.

Set up in 2009, the sovereign wealth fund was designed to boost Malaysia’s economy through strategic investments.

But US authorities say US$4.5 billion was diverted from 1MDB into private pockets, and they have been investigating the corruption scandal.

According to US and Malaysian prosecutors, the money was used to buy assets including luxury real estate, a private jet and expensive artworks.

Red flags were first raised in 2015 after 1MDB fund missed payments owed to banks and bondholders.

Mr Najib faces more than 40 charges and has gone on trial for his role in a financial scandal. He has pleaded not guilty.

He is accused of pocketing US$681 million from 1MDB. Prosecutors said the money had been used to fund a lavish lifestyle for the former PM and his wife Rosmah Mansor, who is also facing charges of corruption.

Malaysia aims to retrieve US$7 billion in misappropriated funds from 1MDB. The 1MDB had amassed debts of more than S$18 billion at its peak, according to the country’s declassified Auditor-General’s report.