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1MDB sues JPMorgan Chase, Deutsche Bank in $23 billion fraud case

The Malaysian strategic development firm has filed six suits against nine unnamed entities, including two foreign financial institutions, and 25 individuals for various wrongdoings including fraud and conspiracy.

May 10, 2021 / 03:55 PM IST
Boxes of 1Malaysia Development Berhad (1MDB) documents arrive at Kuala Lumpur High Court in Kuala Lumpur, Malaysia.| (PC-REUTERS/Lai Seng Sin)

Boxes of 1Malaysia Development Berhad (1MDB) documents arrive at Kuala Lumpur High Court in Kuala Lumpur, Malaysia.| (PC-REUTERS/Lai Seng Sin)

1Malaysia Development Berhad (1MDB) has filed lawsuits against entities including JPMorgan Chase & Co. and Deutsche Bank AG for various wrongdoings including fraud and conspiracy to defraud the scandal-plagued state-owned investment fund, Bloomberg on May 10 reported, quoting the Malaysian Finance Ministry.

With the Southeast Asian country seeking to recover assets worth more than $23 billion linked to the fraud, 1MDB has filed six suits against nine unnamed entities, including two foreign financial institutions, and 25 individuals. Another firm SRC International Sdn also filed additional suits.

1MDB scandal: Malaysian bank AmBank to pay $699 million as settlement

The move is seen as an attempt by the firm, from which billions of dollars were allegedly siphoned off by people connected to former Malaysian prime minister Najib Razak, to recover assets.

"The government’s recovery efforts are now focused on pursuing other wrongdoers who have caused losses to 1MDB and or SRC during the execution of their duties, as parties directly or indirectly involved in 1MDB and or SRC’s various operations and transactions," the report quoted Finance Minister Tengku Zafrul Abdul Aziz's statement.

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Earlier in 2020, Goldman Sachs admitted its role in the biggest foreign bribery case in US enforcement history. This was done to reach multiple international settlements in the billions of dollars so that probes into its fundraising for 1MDB may end.

In March 2021, to resolve all claims related to the firm’s audit of 1MDB and SRC between 2011-2014, Deloitte PLT agreed to a 324-million ringgit ($80 million) settlement with the Malaysian government. The move came after AmBank Group Malaysia, which highlighted the 1MDB scandal, agreed to pay 2.83 billion ringgit ($699 million) to the government as a settlement in February.

The payment by AMMB Holdings Bhd is for "all outstanding claims and actions in relation to the AmBank Group's involvement in the 1MDB matter," Malaysia's finance ministry said, as quoted by Bloomberg.

Currently, the Malaysian court is hearing the appeal of Razak who is seeking an overturn of his conviction and 12-year jail sentence linked to the 1MDB scandal. Due to the scandal, Razak's government fell in 2018.
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