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Law and Order

1MDB Fraud Case Reaches Settlement

In the 1Malaysia Development Berhad (1MDB) fraud case where the Malaysian government officials allegedly siphoned money from the development bank for personal gain, the US Department of Justice (DOJ) reached a settlement. The DOJ’s Kleptocracy Asset Recovery Initiative department has finalized a settlement agreement. It recovers $700 million from the mastermind behind the scheme- Low Taek Jho. He allegedly misappropriated over $4.5 billion from 1MDB.

The 1MDB scandal has trapped biggies with officials and entities including Goldman Sachs subsidiaries, the former Prime Minister of Malaysia, and a former DOJ employee being few of them.

The terms of the settlement were that Low, his family members, and FFP, a Cayman Islands entity serving as the trustees overseeing the assets at issues in these forfeiture actions, agree to forfeit all assets subject to pending forfeiture complaints in which they have a potential interest. The trustees will also cooperate with and assist the Justice Department in the orderly transfer, management and disposition of the relevant assets.

The United States will release $15 million from the assets (formerly managed by FFP) to Low’s counsel to pay for legal fees and costs. None of those fees, under the agreement, can be returned to Low or his family members. The assets to settle the agreement include high-end real estate in Beverly Hills, New York and London. Plus there is a luxurious boutique hotel in Beverly Hills and ten million dollars in business investments.

Low allegedly made these investments with funds traceable to misappropriated 1MDB monies. When totaled the value of all assets seized is greater than $1 billion. Earlier the seized assets included the Park Lane Hotel in New York and a luxury yacht valued at $140 million and $120 million, respectively.

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