USD452 million in 1MDB funds returned

KUALA LUMPUR (AFP) – The United States (US) has returned USD452 million to Malaysia related to the scandal-hit sovereign wealth fund 1Malaysia Development Berhad (1MDB), authorities said yesterday as the Southeast Asian nation steps up efforts to recover looted cash.

Billions of dollars were stolen from 1MDB in a fraud that involved former premier Najib Razak, and spent on everything from a super-yacht to art.

Some of the looted money was spent in the US and laundered through the American financial system, and authorities there have been clawing back funds and sending it to Malaysia.The latest tranche to arrive from the US is around MYR1.9 billion (USD452 million), Malaysia’s finance ministry said in a statement.

The US Justice Department remitted the money to a special “assets recovery” account in Malaysia, which has now received a total of RM16.05 billion in 1MDB funds, the ministry said.

The account will be mainly used to repay debts of 1MDB and a former unit, SRC. 1MDB still has MYR39.8 billion in outstanding debt, the ministry said.

Najib’s long-ruling coalition lost power in 2018 in large part due to the scandal, and since then authorities have been working to get back pilfered funds.

Last week, 1MDB sued units of Deutsche Bank, JPMorgan and Coutts in Malaysia for billions of dollars as part of these efforts.

Wall Street giant Goldman Sachs also became embroiled in the 1MDB scandal, after helping to raise billions of dollars for the fund.

The bank reached a USD3.9 billion settlement with the Malaysian government last year in exchange for criminal charges being dropped.