Kristian Rouz — The bribery and money laundering scandal surrounding Malaysian fund 1Malaysia Development Berhard, or 1MDB, is expanding as the US Justice Department has filed a motion to recover some $38 million from the scheme.
The newest filing, announced Monday, brings the total sum of US claims in the 1MDB case to a whopping $1.7 billion.
In the filing, the DOJ said the 1MDB scheme involved luxury properties in London and New York, among other assets, as well as securities in a Kentucky-based property management company. All these assets, prosecutors believe, are connected to bond issues from the Malaysian fund, dating back to 2012 and 2013.
"These new lawsuits target assets collected by corrupt officials and their associates through a massive scheme that stole billions of dollars from the people of Malaysia and laundered the proceeds across the world", Nick Hanna, a US Attorney in Los Angeles, Calif., said.
The DOJ's latest motion was filed with a California court, and might affect other parties of interest that recently emerged in the case.
Separate reports have suggested the DOJ is also targeting Hollywood producer Joey McFarland, whose bank account reportedly came under scrutiny due to his suspected ties to 1MDB. Prosecutors believe the case also involves financier from Los Angeles Jho Low, whose whereabouts are currently unknown.
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The DOJ also said its anti-corruption unit is looking into Low's revenues from sales of bonds related to 1MDB. Investigators suggest Low used that money to buy high-end residential property in London.
Yet another report claims that Malaysian prosecutors have indicted British national Paul Stadlen, for laundering some $3.5 million in a 1MDB-related scheme. The announcement came on Thursday, and narrowly predates the DOJ's recent filing.
Stadlen served as a media adviser to former Malaysian Prime Minister Najib Razak, who is believed to be heavily involved in the multi-billion dollar corruption and laundering scheme. Stadlen allegedly transferred illicit funds into a law firm's account on behalf of corrupt Malaysian officials and their affiliates.
Stadlen became the subject of an investigation after online reports suggested he's been living a lavish lifestyle he couldn't afford. Several blogs posted his pictures in upbeat London nightclubs, alleging possible ties to transnational corruption.
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US investment bank Goldman Sachs helped raise funds and underwrote up to $6.5 billion worth of bonds for 1MDB and its projects. Goldman officials claim they hadn't known they were dealing with the proceeds of corruption and other illicit activities.
As the probe into 1MDB-related assets widens, DOJ officials said the investigation is set to continue until the full scope of this corruption scheme is revealed.
