U.S. seeks to recover another $96 million in 1MDB-associated assets
The Justice Department announced today the filing of civil
forfeiture complaints seeking the forfeiture and recovery of approximately $96
million in assets allegedly associated with an international conspiracy to
launder funds misappropriated from 1Malaysia Development Berhad (1MDB), a
Malaysian sovereign wealth fund.
Combined with earlier civil forfeiture complaints filed begining in July
2016, the United States has sought the forfeiture of more than $1.8 billion in
assets traceable to funds embezzled from 1MDB.
To date, as a result of these actions, the United States has recovered
or assisted Malaysia in recovering nearly $1.1 billion in assets associated
with the 1MDB international money laundering and bribery scheme. This case represents the largest action
brought under the department’s Kleptocracy Asset Recovery Iniative as well as
the largest civil forfeiture action in the Justice Department’s history.
The complaints filed today in the Central District of
California identify additional assets traceable to the 2012 and 2013 bond
offerings. These assets include luxury
real estate in Paris, artwork by Claude Monet and Andy Warhol, and accounts
maintained at financial institutions in Luxembourg and Switzerland.
According to the complaints, from 2009 through 2015, more
than $4.5 billion in funds belonging to 1MDB were allegedly misappropriated by
high-level officials of 1MDB and their associates. 1MDB was created by the government of
Malaysia to promote economic development in Malaysia through global
partnerships and foreign direct investment, and its funds were intended to be
used for improving the well-being of the Malaysian people.
“The complaint filed today seeks to forfeit a range of
luxury items — including real estate in Paris, artwork by Monet, Warhol, and
Basquiat, and international bank accounts — all of which were allegedly
acquired with funds stolen from Malaysia’s sovereign wealth fund,” said
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s
Criminal Division. “Today’s action is
just the latest demonstration of the Criminal Division’s longstanding commitment
to tracing, seizing, and forfeiting assets acquired through grand corruption
and, wherever possible, returning those assets to the people from whom they
were stolen.”
“The FBI will relentlessly pursue international corruption
investigations,” said FBI Assistant Director Calvin Shivers of the Criminal
Investigative Division. “As efforts in
this case have shown, our dedicated investigators will pursue corruption,
uncover proceeds of illicit activity, and return ill-gotten gains to the
rightful owners. In this case, to the
people of Malaysia.”
“These seemingly endless civil forfeiture complaints
associated with the 1MDB scandal are representative of the seemingly endless
schemes used to hide and launder money as part of the sophisticated efforts to
steal from the Malaysian people,” said Don Fort, Chief, IRS Criminal
Investigation. “This latest civil
forfeiture complaint would return an extraordinary sum of money to the people
of Malaysia where it belongs and where it can finally be used for its original
intended purpose - to improve the lives of everyday Malaysians.”
As alleged in the complaints, the members of the conspiracy
– which included officials at 1MDB, their relatives and other associates –
diverted more than $4.5 billion in 1MDB funds.
Using fraudulent documents and representations, the co-conspirators
allegedly laundered the funds through a series of complex transactions and
shell companies with bank accounts located in the United States and
abroad. These transactions allegedly
served to conceal the origin, source and ownership of the funds, and ultimately
passed through U.S. financial institutions to then be used to acquire and
invest in assets located in the United States and overseas.
As alleged in the earlier complaints, in 2009, 1MDB
officials and their associates embezzled approximately $1 billion that was
supposed to be invested to exploit energy concessions purportedly owned by a
foreign partner. Instead, the funds were
allegedly transferred through shell companies and were used to acquire a number
of assets, as set forth in the complaints.
The complaints also allege that the co-conspirators misappropriated
close to $1.4 billion in funds raised through bond offerings in 2012, and more
than $1.2 billion following another bond offering in 2013. The complaints also allege that in 2014, the
co-conspirators misappropriated approximately $850 million in 1MDB funds under
the guise of repurchasing certain options that had been given in connection
with a guarantee of the 2012 bonds.
The FBI’s International Corruption Squads in New York City
and Los Angeles and the IRS-CI are investigating the case. Deputy Chief Woo S. Lee and Trial Attorneys
Barbara Levy and Joshua L. Sohn of the Criminal Division’s Money Laundering and
Asset Recovery Section are prosecuting the case. Assistant U.S. Attorneys John Kucera and
Michael Sew-Hoy of the U.S. Attorney’s Office for the Central District of
California provided substantial assistance.
The trial team also expresses its gratitude and appreciation to the
Criminal Division’s Office of International Affairs for their continued
assistance in this matter.
The department also expresses its deep appreciation for the
significant assistance provided by the Office of the Attorney General and the
Federal Office of Justice of Switzerland, the judicial investigating authority
of the Grand Duchy of Luxembourg and the Criminal Investigation Department of
the Grand-Ducal Police of Luxembourg, the Attorney General’s Chambers of
Singapore, the Singapore Police Force-Commercial Affairs Division, and the
Attorney General’s Chambers of Malaysia, the Royal Malaysian Police, and the
Malaysian Anti-Corruption Commission.
The Kleptocracy Asset Recovery Initiative is led by a team
of dedicated prosecutors in the Criminal Division’s Money Laundering and Asset
Recovery Section, in partnership with federal law enforcement agencies, and
often with U.S. Attorney’s Offices, to forfeit the proceeds of foreign official
corruption and, where appropriate, to use those recovered assets to benefit the
people harmed by these acts of corruption and abuse of office. In 2015, the FBI formed International
Corruption Squads across the country to address national and international
implications of foreign corruption.
Individuals with information about possible proceeds of foreign
corruption located in or laundered through the United States should contact
federal law enforcement or send an email to kleptocracy@usdoj.gov (link sends
e-mail) or https://tips.fbi.gov/.
A civil forfeiture complaint is merely an allegation that
money or property was involved in or represents the proceeds of a crime. These allegations are not proven until a
court awards judgment in favor of the United States.
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