Posts Tagged ‘DOJ

01
Nov
19

Recovery of US$1 billion in assets associated with the 1MDB scandal by the US

United States Reaches Settlement to Recover More Than $700 Million in Assets Allegedly Traceable to Corruption Involving Malaysian Sovereign Wealth Fund

Wednesday, October 30, 2019

The Department of Justice has reached a settlement of its civil forfeiture cases against assets acquired by Low Taek Jho, aka Jho Low, and his family using funds allegedly misappropriated from 1Malaysia Development Berhad (1MDB), Malaysia’s investment development fund, and laundered through financial institutions in several jurisdictions, including the United States, Switzerland, Singapore and Luxembourg.

These assets, located in the United States, the United Kingdom and Switzerland, are estimated to be worth more than $700 million. With the conclusion of this settlement, together with the prior disposition of other related forfeiture cases, the United States will have recovered or assisted in the recovery of more than $1 billion in assets associated with the 1MDB international money laundering and bribery scheme. This represents the largest recovery to date under the Department’s Kleptocracy Asset Recovery Initiative and the largest civil forfeiture ever concluded by the Justice Department.

“As alleged in the complaints, Jho Low and others, including officials in Malaysia and the United Arab Emirates, engaged in a brazen multi-year conspiracy to launder money embezzled or otherwise misappropriated from 1MDB, and he used those funds, among other things, to engage in extravagant spending sprees, acquiring one-of-kind artwork and luxury real estate, gambling freely at casinos, and propping up his lavish lifestyle,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “This settlement agreement forces Low and his family to relinquish hundreds of millions of dollars in ill-gotten gains that were intended to be used for the benefit of the Malaysian people, and it sends a signal that the United States will not be a safe haven for the proceeds of corruption.”

“A staggering amount of money embezzled from 1MDB at the expense of the people of Malaysia was laundered through the purchase of big-ticket assets in the U.S. and other nations. Thanks to this settlement, one of the men allegedly at the center of this massive scheme will lose all access to hundreds of millions of dollars,” said U.S. Attorney Nicola T. Hanna of the Central District of California. “The message in this case is simple: the United States is not a safe haven for pilfered funds. Our strict anti-money laundering controls are effective, and we will seize assets used by criminals to conceal ill-gotten gains.”

“Today’s settlement with Jho Low demonstrates the continued commitment of the FBI to root out the fraud and selfishness of the corrupt individuals who conspired to pay bribes and launder funds which belong to the Malaysian people,” said FBI Assistant Director Terry Wade of the Criminal Investigative Division. “The FBI’s dedicated International Corruption Squads will continue to combat foreign corruption which reaches our shores. We will not allow criminals, foreign or domestic, to use the United States in furtherance of their criminal activities.”

“The action announced today will allow the United States government to deny Mr. Low the use of the assets purchased with this extraordinarily large sum of money he allegedly misappropriated from 1MDB and the people of Malaysia,” said Chief Don Fort of IRS Criminal Investigations (IRS-CI). “Mr. Low allegedly attempted to launder these funds through multiple international jurisdictions and a web of shell corporations, but his greed finally caught up with him. This case is a model for international cooperation in significant cross-border money laundering investigations”

According to the civil forfeiture 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, including Low, through a criminal conspiracy involving international money laundering and bribery. 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.

Under the terms of the settlement, Low, his family members, and FFP, a Cayman Islands entity serving as the trustees overseeing the assets at issue in these forfeiture actions, agreed to forfeit all assets subject to pending forfeiture complaints in which they have a potential interest. The trustees are also required to cooperate and assist the Justice Department in the orderly transfer, management and disposition of the relevant assets. From the assets formerly managed by FFP, the United States will release $15 million to Low’s counsel to pay for legal fees and costs. Under the agreement, none of those fees may be returned to Low or his family members. The assets subject to the settlement agreement include high-end real estate in Beverly Hills, New York and London; a luxury boutique hotel in Beverly Hills; and tens of millions of dollars in business investments that Low allegedly made with funds traceable to misappropriated 1MDB monies.

Low separately faces charges in the Eastern District of New York for conspiring to launder billions of dollars embezzled from 1MDB and for conspiring to violate the Foreign Corrupt Practices Act (FCPA) by paying bribes to various Malaysian and Emirati officials, and in the District of Columbia for conspiring to make and conceal foreign and conduit campaign contributions during the United States presidential election in 2012. The charges in the indictments are merely allegations, and defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law. This agreement does not release any entity or individual from filed or potential criminal charges.

The assets being forfeited subject to this settlement are in addition to the nearly $140 million in assets the U.S. previously forfeited in connection with Low’s investment in a business entity related to the Park Lane Hotel in New York, as well as a super-yacht, valued at over $120 million, seized by law enforcement authorities in Indonesia at the request of the Justice Department and recovered by Malaysian authorities directly from Indonesia. Following conclusion of today’s settlement, several civil forfeiture complaints arising out of the 1MDB criminal conspiracy remain pending against assets associated with other alleged co-conspirators.

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 Kyle R. Freeny, Joshua L. Sohn, Barbara Levy and Jonathan Baum of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorneys John Kucera, Michael R. Sew Hoy and Steven R. Welk of the Central District of California are prosecuting the case. The Criminal Division’s Office of International Affairs is providing substantial assistance.

The Department also appreciates the significant assistance provided by the Attorney General’s Chambers of Malaysia, the Royal Malaysian Police, the Malaysian Anti-Corruption Commission, the Attorney General’s Chambers of Singapore, the Singapore Police Force-Commercial Affairs Division, 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 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 U.S. 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.

…source
United States Reaches Settlement to Recover More Than $700 Million in Assets Allegedly Traceable to Corruption Involving Malaysian Sovereign Wealth Fund
October 30, 2019 – DOJ

02
Nov
18

US criminal charges brought against Jho Low and Roger Ng

(Source: US Department of Justice)

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04
Sep
17

No checks and balances on executive power in Malaysia

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Trump’s hosting of Malaysia’s prime minister marks another setback for the rule of law
By Josh Rogin
September 3 2017 – Washington Post

11
Jul
17

1MDB and the conspiracy of silence

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1MDB and the conspiracy of silence
6 Jul 2017 – Aliran

09
Jul
17

Penaga folk stunned over scale of theft at 1MDB

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Penaga folk stunned over scale of theft at 1MDB
7 Jul 2017 – Malaysian Insight

09
Jul
17

PH leaders hail Dr Mahathir-Anwar pact as key to overthrowing BN

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PH leaders hail Dr Mahathir-Anwar pact as key to overthrowing BN
7 Jul 2017 – Malaysian Insight

08
Jul
17

Dr M has no objection to Anwar becoming PM

Father of modern Malaysia backs jailed former deputy in attempt to oust PM

Mahathir Mohamad says former deputy Anwar Ibrahimm, jailed on charges of sodomy, should be freed to contest election against scandal-ridden Najib

…more
Father of modern Malaysia backs jailed former deputy in attempt to oust PM
6 July 2017 – The Guardian

Dr M

07
Jul
17

Dr M: Only an idiot will believe I can influence the DOJ

Dr M: Only an idiot will believe I can influence the DOJ

Former prime minister Dr Mahathir Mohamad reiterated today that only an idiot will believe he can influence US Department of Justice (DOJ) to initiate civil forfeiture suits against 1MDB.

In his latest blog posting, Mahathir sardonically said that he was flattered by claims that he, a powerless man, could instruct DOJ to do something.

“If I could issue a directive to a US agency, then someone would have been arrested and charged for stealing billions of dollars long ago. Equitable punishment would have been imposed on such a person,” he said.

“Unfortunately, I, as the former prime minister of ‘toothless’ Malaysia, do not have such influence over any agency in the US, and also in Malaysia,” he said.

“Only those who are stupid will believe,” he said, adding that this showed that ‘dedak’ (bribes) given by the prime minister Najib Abdul Razak may have worked on these people.

Unlike Malaysia, which is satisfied with Prime Minister Najib Abdul Razak’s statement that an Arab national donated the RM2.6 billion to him, Mahathir said the US took stern action against those involved in money-laundering.

‘Using foreign power to interfere’

Mahathir and the opposition have been accused of using foreign power to interfere in the country’s internal affairs, soon after the DOJ filed its third forfeiture lawsuit in a US court on June 15.

The DOJ is seeking to seize more than US$1 billion in assets it said were purchased with money stolen from 1MDB. In the suit, DOJ also shed light on what happened to the US$620 million that MO1 had returned to his “donor”.

The DOJ also alleged that at least US$27.3 million was used to buy a 22-carat pink diamond pendant and necklace for “MO1’s wife”.

Attorney-General Mohamed Apandi Ali has also cleared Najib of wrongdoing in the 1MDB matter.

Minister in the Prime Minister’s Department Abdul Rahman Dahlan had confirmed that MO1 was Prime Minister Najib Abdul Razak.

Mahathir, who is also Parti Pribumi Bersatu Malaysia chairperson, said MO1’s wife and the recipients of illegal funds have yet to return misappropriated money to Malaysians, despite celebrities Leonardo DiCaprio and Miranda Kerr having returned their gifts given by controversial figure Jho Low.

“They are thick-skinned and shameless. When they were alleged to have stolen (the money), these people, including Najib and Umno leaders, just smiled,” Mahathir said.

He said Jho Low and Najib’s stepson Riza Aziz should have challeged the lawsuit filed by DOJ in the US court.

Citing a Malay proverb “berani kerana benar, takut kerana salah” (why should one be afraid if one has not faulted), he said both Riza and Low do not dare to take on the DOJ, thus they were hiding in China and in Malaysia.

Mahathir deems their moves to be admission of the DOJ’s accusations.

…more
Dr M: Only an idiot will believe I can influence the DOJ
5 July 2017 – malaysiakini

06
Jul
17

‘Looks like we may have hit a goldmin(e),’ Jho Low wrote to family

1MDB Update: ‘Looks like we may have hit a goldmin(e),’ Jho Low wrote to family

THE US Department of Justice filed new civil suits last week to seize assets acquired with money stolen from 1Malaysia Development Bhd, which it now says could have been as much as US$4.5 billion (RM19.2 billion).

The central figure again is Low Taek Jho, or Jho Low.

In the latest civil suits filed on June 7 and 14, the various DOJ documents show how Jho Low was involved in many of the transactions and movements of billions of dollars although he held no official role in 1MDB. It appears that the DOJ investigators have obtained numerous emails involving Jho Low.

In one email he sent to his parents, brother and sister on Sept 7, 2009, after he had met Malaysian Official 1 and the Petro Saudi International co-founders Tarek Obaid and Prince Turki on a yacht off Monaco, Jho Low wrote, “Just closed the deal with petrosaudi. Looks like we have hit a goldmin(e).”

On Sept 28, 1MDB signed up to a joint venture to invest US$1 billion with Petro Saudi. It was subsequently exposed by The Edge and others that US$700 million did not go to the JV but to Good Star Ltd, a Seychelles company that The Edge reported was controlled by Jho Low. 1MDB had insisted Good Star was owned by Petro Saudi.

According to the latest DOJ suits, despite various questions raised by the banks that handled the transfer of the US$700 million to Good Star, Jho Low, with the help of 1MDB executives identified as 1MDB Officer 1 (executive director K C Tang) and 1MDB Officer 2 (CEO Datuk Shahrol Halmi), convinced Deutsche Bank and RBS Coutts to allow the money to be transferred to Good Star.

On Oct 2, 2009, Jho Low met RBS Coutts officers and provided them with a copy of an investment management agreement between 1MDB and Good Star dated Sept 29 and signed by 1MDB Officer 1 and Good Star representative Seet Li Lin. (In an infamous post on his Facebook, Seet wrote, “I feel the earth moved under my feet”, after the money was transferred.)

The DOJ suit said: “Although RBS Coutts had unblocked the funds, employees at the bank continued to have concerns about the size of, and justification for, the US$700 million wire from a state-owned entity.”

On Oct 28, 2009, two RBS Coutts officers met Jho Low and 1MDB Officer 1 in Zurich, where the latter allegedly “confirmed the false information that (Jho Low) had provided the bank about the purpose and validity of the US$700 million transfer”.

According to the DOJ, the 1MDB board never approved any investment management with Good Star.

By early 2010, Jho Low had changed the story about the US$700 million, calling it a loan from 1MDB to Good Star. “Low provided RBS Coutts with a copy of a purported loan agreement… to retroactively recognise the US$700 million transfer as a loan.”

The DOJ suit went on to say that 1MDB Officers 1 and 2 continued to conceal and misrepresent to the board of directors the true identity of the beneficiary of the US$700 million transfer.

The latest DOJ suits confirm what The Edge Financial Daily reported on July 20, 2015: “How Jho Low and PetroSaudi cheated Malaysia of US$1.83 billion cash with help from 1MDB executives.”

We were suspended a few days later. The High Court subsequently overturned the suspension.

…more
1MDB Update: ‘Looks like we may have hit a goldmin(e),’ Jho Low wrote to family
June 29, 2017 – The Edge Malaysia

05
Jul
17

DoJ’s latest lawsuit under its Kleptocracy Asset Recovery Initiative – One can only wonder at the reactions

A case of many wonders in DoJ’s latest action

Malaysia can learn much from the DoJ’s latest lawsuit under its Kleptocracy Asset Recovery Initiative.

COMMENT

One can only wonder at some of the political reactions and responses to the United States Department of Justice’s (DoJ) latest lawsuit brought under the Kleptocracy Asset Recovery Initiative.

First, one can only wonder at the attorney-general’s (AG) disappointment and frustration that his chambers (AGC) was not informed or alerted by the DoJ of the latest action.

But the lawsuit is a civil action. Specifically, it a civil action in rem (literally, against a thing) to forfeit assets involved in money laundering offences which are in violation of US law. Simply put, it is a civil forfeiture action.

Thus, as former AG Abu Talib Othman put it, the DoJ does not need to get in touch with the AG.

Second, one can only wonder at the prime minister’s press secretary’s concerns with “unnecessary and gratuitous naming of certain matters and individuals” which “suggests a motivation that goes beyond the objective of seizing assets”.

But the lawsuit, commenced by way of a complaint, must meet the requirements of the US Federal Rules of Civil Procedure (USFRCP). In principle, a complaint must state a cause of action. And a cause of action is “a factual situation, the existence of which entitles one person to obtain from the court a remedy against another person”.

A Malaysian Federal Court judge once said that a cause of action is the entire set of facts that gives rise to an enforceable claim. Thus, if the complaint states matters and names individuals in setting out the entire set of facts, it is far from unnecessary and gratuitous. The opposite is in fact the case, for an incomplete set of facts constitutes an incomplete cause of action, which is bound to be dismissed by the court.

Third, one can only wonder at Azalina Othman’s calling of the latest lawsuit as a rehashing of the 1Malaysia Development Berhad (1MDB) issue by the DoJ. The AG calls it a repeat of the first lawsuit. But the defendant in the latest lawsuit (Viceroy Hotel Group) is different from the defendants in the earlier lawsuits (named and identified in paragraphs 5(a)-(t) of the latest lawsuit).

This makes the latest action a separate action from the earlier ones (each action bearing a different case number). The facts are “rehashed”, so to speak, because each action must meet the requirement of the rules of setting out the factual situation.

Fourth, one can only wonder at Abdul Rahman Dahlan’s comments that while the DoJ had every right to file a suit, it was important to base the case on facts and not on rhetoric or ill-intentioned statements.

But the complaint in the latest lawsuit is a 250-page document and 950-paragraph of statements with compelling substance and depth, as are the statements in the earlier lawsuits. And all the statements in each of the lawsuits are verified and declared under the penalty of perjury to be true and correct by a special agent of the Federal Bureau of Investigation (FBI). This is a first requirement of a complaint under the USFRCP.

Fifth, one can only wonder at Hishammuddin Hussein’s urgings that the DoJ provide evidence to support the latest lawsuit, failing which the DoJ would only tarnish its own reputation and credibility. But the lawsuit, as are the earlier ones, is a civil forfeiture action.

The procedure to be followed is prescribed by the USFRCP which includes: (1) notice to all potential claimants; and (2) full publication notice by either newspaper or internet. Claimants have 30 days from when they are notified to submit a sworn claim indicating the basis for asserting an interest in the property and must, within 21 days after a claim is filed, file an answer with the court directly responding to the allegations in the complaint.

If those deadlines are not met, a default judgment of forfeiture may be granted. If a timely claim is filed, the action will proceed with civil discovery in the nature of interrogatories, and depositions may take place.

If the action is contested and no settlement is agreed on by the parties, it will proceed to a trial by civil jury where only then evidence will be presented. Thus, in due course the evidence will be presented. Just wait…

Sixth, one can only wonder at Hishammuddin’s challenge to the DoJ to press charges if they have proof of wrongdoing in the 1MDB affair. But in civil forfeiture, the action may be brought at any time prior to or after criminal charges are filed, or even if criminal charges are never filed.

There is a reason why a civil forfeiture action is filed first and importantly in time. There is a time period requirement under the law to either file a civil case or include the seized asset in a criminal charge and name it for criminal forfeiture. If a civil case is not filed within the time period, the government will be prevented from ever filing a civil forfeiture action.

And because civil forfeiture does not depend upon a conviction which requires a higher burden of proof, it is usually filed in priority to criminal action. Often, the civil action will be filed under seal before criminal charges are brought. Further, in a civil action case, the government does not have to prove that the property owner committed or participated in the commission of the underlying criminal activity. As long as there is proof that the property is sufficiently linked to a crime, and the owner cannot satisfy the test for “innocent owner” by a preponderance of the evidence, the property may be forfeited.

Seven, it is no wonder that the prime minister has said that “many” statements have been issued in relation to the latest lawsuit and that he will no longer be issuing statements.

But alas, the AG did not take heed and accused the DoJ of being politically driven in its lawsuits to seize assets allegedly linked to 1MDB. One can only wonder how actions driven by the commitment to ensure that the US is not a safe haven for assets corruptly obtained can be politically motivated. More so when the actions are in pursuance to the law.

According to Jean B Weld, a US attorney who has written on forfeiture laws and procedure in the country, the US has a robust and effective asset forfeiture legal regime. In more than 25 years of its forfeiture programme, the DoJ has accomplished much.

Malaysia can certainly learn from this, more so when the DoJ has a commitment to continue to extend its assistance to its international partners to recover assets corruptly obtained or laundered.

…more
A case of many wonders in DoJ’s latest action
July 3, 2017 – FMT





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All that is necessary
for the triumph of evil
is for good men
to do nothing.

- Edmund Burke
When the people
fears their government,
there is TYRANNY;
when the government
fears the people,
there is LIBERTY.

- Thomas Jefferson
Do you hear the people sing?

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