This article first appeared in The Edge Malaysia Weekly on March 21, 2022 - March 27, 2022
SUCH staggering amounts were looted from 1Malaysia Development Bhd (1MDB) it beggars belief.
A humongous US$1.42 billion was pocketed by fugitive financier Low Taek Jho (Jho Low) — the alleged mastermind of the looting of 1Malaysia Development Bhd (1MDB) — from the state-owned company’s three bond issuances that raised a total of US$6.5 billion over two years.
Coming second and reaping more than half as much was former prime minister Datuk Seri Najib Razak who took home US$756 million, which was banked into his private accounts from Jho Low’s shell companies.
A US court heard last week for the first time how much was paid in bribes and kickbacks in the 1MDB scandal. An FBI agent, who traced the outflow of funds from three bond transactions that Goldman Sachs Group Inc had arranged for the Malaysian wealth fund, revealed names of the people who benefited from the theft of these funds.
Testifying at the trial of ex-Goldman banker Roger Ng Chong Hwa in the Federal Court in Brooklyn, New York, Eric Van Dorn, who is a forensic accountant for the FBI, said he poured through 59,000 bank records to determine where the money trails led to in the wholesale embezzlement of 1MDB funds.
Apart from Jho Low and Najib’s stupendous payouts — Van Dorn said the amounts pocketed were net amounts after kickbacks had been made — Najib’s stepson Riza Aziz also pocketed US$238 million from the deals, and used that money to fund and produce the hit movie The Wolf of Wall Street.
Ng received US$35.1 million from two of the three bond transactions, while Timothy Leissner collected about twice as much, or US$73.4 million, Van Dorn testified.
1MDB’s former general counsel Jasmine Loo Ai Swan made a whopping US$12.6 million in the three bond offerings. Van Dorn testified that through a shell company which she owned, called River Dee, Loo had transferred US$3.7 million to a law firm in New York to purchase an apartment in Manhattan.
Foreigners who aided in sham projects or deals that allowed money to be skimmed off from 1MDB in the guise of investments, were also handsomely rewarded.
Khadem al-Qubaisi, a former managing director of Abu Dhabi’s state-owned International Petroleum Investment Co (IPIC), which guaranteed two of the 1MDB bond issuances, received US$472.8 million while Mohamed Badawy Al Husseiny, the former CEO of Aabar, pocketed US$76.6 million.
Current United Arab Emirates ambassador to the US, Yousef Al Otaiba, who allegedly helped lobby for these loans to 1MDB, received US$40 million from the three projects, Van Dorn said. The Wall Street Journal had previously reported that Al Otaiba had a long relationship with Jho Low.
In 2019, Al-Qubaisi is reported to have been handed a jail term of 15 years and Al Husseiny 10 years in Abu Dhabi.
Both men profited from the sham deals by funnelling 1MDB funds through to Aabar Investment PJS Ltd — a British Virgin Island registered company known as the fake Aabar as it was not the real subsidiary of IPIC. The real subsidiary, Aabar Investments PJS, does not have the “Ltd” in its name.
The fake Aabar accounts were owned by both men.
Najib’s advisers and 1MDB employees received huge kickbacks
The list of individuals who accepted 1MDB kickbacks that ran into the millions of dollars to turn a blind eye to the massive pillage that was taking place at the state-owned strategic investment company appeared to be growing longer by the day, the US trial of ex-Goldman Sachs banker Roger Ng Chong Hwa in New York has revealed.
A disturbing number of employees of 1MDB, as well as advisers of former prime minister Datuk Seri Najib Razak used shell companies to hide the hefty kickbacks from fugitive financier Low Taek Jho (Jho Low) and his cohorts, a Federal Bureau of Investigation agent testified last week.
FBI agent Eric Van Dorn, who is a forensic accountant, testified that he reviewed 59,000 bank records to determine where more than US$2 billion of the US$6.5 billion in total raised from three 1MDB bond deals — codenamed Project Magnolia, Project Maximus and Project Catalyze — which Goldman had been given the mandate to arrange, had disappeared to, siphoned off by Low and his associates.
Previously, former Goldman banker Tim Leissner had testified that based on a chart by Low, Najib and other influential personalities in the Middle East had topped the list of people to be bribed in the undertaking of the extremely lucrative bond deals.
Van Dorn’s testimony provided a more comprehensive list.
In Najib’s advisory circle, a person identified only as Yan Yahaya received the biggest cut or nearly US$5 million. He received US$900,0000 in an account he owned called Spring Elite from Capital Place — an account owned by Leissner’s wife Judy Chan — which in turn received money from Low, who had siphoned it off from the first US$1.75 billion bond deal (Project Magnolia).
Yan Yahaya’s Spring Elite also received another US$4 million from funds originating from Project Maximus, the second US$1.75 billion bond deal, in two separate transactions. Both transfers originated from Leissner’s company accounts. In total, Yan Yahaya netted a cool US$4.9 million.
Van Dorn also testified that Najib’s late principal private secretary Datuk Azlin Alias, through the elaborate scheme of bribes, had been paid US$980,000.
Not to be left out was Datuk Amhari Effendi Nazaruddin, Najib’s former special officer who received US$895,000. In 2019, at Najib’s 1MDB-Tanore trial in Kuala Lumpur, Amhari testified to only obtaining a US$200,000 loan from Low to purchase a house. However, Van Dorn testified that Amhari had received the US$895,000 between 2012 and 2013.
Then there were the 1MDB staffers.
Topping the list was 1MDB general counsel Jasmine Loo, who amassed US$12.6 million using three corporate accounts. Finance director Terence Geh, who was a signatory on all three deals, received US$2 million, as did former chief investment officer Vincent Koh.
Lesser known employees Nurzahid Taib and Jerome Lee received US$2 million and US$1.7 million respectively.
Van Dorn’s testimony was the first time US authorities detailed how those involved in the 1MDB deals were paid and how much they received.
Ng, the only Goldman banker to go on trial over the epic looting of 1MDB, was charged with conspiring with Low and his former boss Leissner in the massive fraud. Leissner, who pleaded guilty and is cooperating with the government, spent more than a week on the stand as the star prosecution witness against Ng. Low is not in custody and remains a fugitive.
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