KUALA LUMPUR (Dec 6): Saudi national Tarek Obaid was the sole person who had caused numerous transactions which enabled US$180 million from 1Malaysia Development Bhd (1MDB) to be allegedly siphoned off to his firm PetroSaudi International Ltd (PSI), before they ended up in an escrow account held by UK-based law firm Clyde & Co, the High Court was told on Monday.

“Tarek Obaid and Tarek Obaid alone had caused these transactions of money which eventually ended up in the escrow account,” deputy public prosecutor (DPP) Budiman Lutfi Mohamed told Judge Datuk Ahmad Shahrir Mohd Salleh on Monday while submitting on the government’s application for an order to stop any dealings on the monies held in the account.

According to the DPP, the application would stop the money from being transferred out of the escrow account before the hearing proper began.

Malaysian Anti-Corruption Commission (MACC) investigating officer Mohd Afiq Abdul Aziz, in his affidavit in support of the forfeiture application, said the disputed funds were from the 1MDB-PSI joint venture set up in 2010, during which 1MDB injected US$300 million.

Of that amount, US$185 million went to PSI’s subsidiary PetroSaudi Oil Services (Venezuela) Ltd (incorporated in Barbados) (PSOSL). The US$180 million in turn is part of the money that went to the company.

“If we do nothing to stop the bleeding of where the money went to the respondents (Tarek, PSI, PSOSL, Clyde & Co, and Temple Fiduciary), 1MDB and the government will not see a single cent of this money. That is why this application is important,” he said.

He went on to outline that Tarek was the owner, shareholder and signatory of PSI, PSOSL and other PSI entities.

“It is inevitable that he had absolute control over all the companies and more so the bank accounts of PSI and PSOSL,” he said.

Shahrir then asked Budiman if he had any facts or documentation to show that the US$180 million had gone into the escrow account, to which Budiman said he only had affidavits of support and further added that if the court granted the application, they can request the relevant documents to show that the funds in question were transferred to Clyde & Co.

Tarek is represented by Datuk Yusof Zainal Abiden, while PSOSL is represented by Alex Tan.

Previously, Clyde & Co declined to respond to affidavits served to the law firm by the prosecution.

The government is seeking a total of US$340 million from PSI. In addition, it is also seeking unspecified sums that were deposited under an intermediate account name, Temple Fiduciary Services Ltd, at Barclays Bank in the UK.

The application, filed under Section 53 of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act, named Tarek, PSI, PSOSL, Clyde & Co, and Temple Fiduciary as the first to fifth respondents.

Submissions before Sharir will continue on Dec 9 with Yusof and Tan to submit in defence of their clients.

It was reported on Sept 17 last year that the US Department of Justice (DOJ) had also filed a similar application to seek US$300 million in additional assets allegedly associated with the multibillion-dollar 1MDB scandal, which it had traced to the escrow account in the UK.

Besides the forfeiture action on Tarek by Malaysia and the US, it is understood that the UK and Switzerland have also filed claims on the Saudi national.

In May, 1MDB also filed a suit against Tarek, PSI, its former director Patrick Mahony, Deutsche Bank, Coutts & Co (Switzerland) and JP Morgan (Switzerland), as defendants.

1MDB cited negligence, breach of contract, conspiracy to defraud and dishonest assistance, where it is seeking US$1.11 billion from Deutsche Bank, US$1.03 billion from Coutts & Co plus interests, US$800 million from JP Morgan and interests on the sum, and US$1.83 billion from the two PetroSaudi companies and Tarek, plus interests and US$153 million from Mahony.

This resulted in the total quantum sought to be US$4.923 billion. Tarek and PetroSaudi are alleged to be responsible for the 1MDB PetroSaudi venture and transfers to Good Star Ltd, an entity owned by Jho Low as testified in the 1MDB trial.

Note: This story has been updated for accuracy. The figure transferred from 1MDB into the escrow account is US$180 million, and not as reported earlier. The error is regretted.