1MDB funds amounting to US$248 million, siphoned out through two companies linked to fugitive businessman Low Taek Jho or Jho Low, were sent to Najib Razak’s stepson and partly used for gambling, a court filing said.
In its opening statement, the sovereign wealth fund and three of its subsidiaries, who are suing Riza Aziz for misappropriation of the funds, said the proceeds were also used to fund movies produced by Red Granite Pictures, and purchase real estate and movie memorabilia.
The statement filed by solicitors Shearn Delamore & Co yesterday, however, did not give details of how much money was spent on the gambling activity.
The state investor (1MDB) and the three companies, 1MDB Energy Holdings Ltd, 1MDB Energy Ltd and 1MDB Energy (Langat) Ltd filed the suit in 2021.
Malaysian and US investigators estimate a total of US$4.5 billion was siphoned from 1MDB following its inception in 2009, implicating many people, including Najib, Low, Goldman Sachs personnel and high-level officials elsewhere.
In this suit, 1MDB said between 2011 and 2012, US$10 million was siphoned out to the defendants – Riza, Red Granite Pictures Incorporated (RGP) and Red Granite Capital Ltd (RGC) via Good Star owned by Low through various intermediate steps.
In 2009, 1MDB had raised US$1 billion but US$700 million went to Good Star, believed to be a subsidiary of a joint-venture company (1MDB Petro Saudi Ltd).
The US$10 million was sent from Good Star, a company owned by Low, to the RGP operating account whose signatory was Riza.
Another US$238 million was also siphoned out in 2012 when 1MDB engaged Goldman Sachs to arrange and underwrite two separate bonds amounting to US$3 billion raised to acquire certain energy assets.
The statement said after 1MDB and/or its subsidiaries had received the proceeds from the bonds, Low procured and caused 1MDB and/or its subsidiaries to siphon out a substantial portion of the net proceeds to a Swiss bank account belonging to an entity called Aabar Investments PJS Ltd.
It said Low set up an account at BSI Bank in Lugano, Switzerland in the name of a fictitious company, Aabar-BVI and arranged for the fraudulent transfer of around US$1.367 billion from 1MDB to Aabar-BVI.
The US$238 million was then sent to Riza and the two companies between June 18 and Nov 14, 2012.
It said 1MDB’s former CEO Shahrol Azral Ibrahim Halmi would testify to provide an overview of the parties, relevant entities and individuals involved, such as Low, the salient background facts, the Good Star Phase and Aabar Phase.
The statement said 1MDB’s former general counsel Jasmine Loo would enlighten the court on the preparation of the relevant documents necessary for the investment projects under the Aabar Phase.
It said liquidator Richard Templeman would explain the monetary transactions within the Good Star Phase and Aabar Phase as well as the tracing of the misappropriated funds.
1MDB claimed that Riza, who controlled the two Red Granite companies, which produced the Hollywood hit
The Wolf of Wall Street
, knew or ought to have known that the funds had been misappropriated and used for their benefit or their associates.
The plaintiffs are therefore seeking a declaration that Riza as well as the Red Granite companies are liable to account for the funds misappropriated from 1MDB.
Alternatively, the plaintiffs are seeking a repayment of the funds misappropriated from it based on unjust enrichment.
Source : FMT
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