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US goes after more than $1B taken from Malaysian fund 1MDB
AP
July 21, 2016
WASHINGTON (AP) — The United States moved Wednesday to recover more than $1 billion that federal officials say was stolen from a Malaysian sovereign wealth fund and that was used for high-end real estate, fancy artwork and production of the Hollywood film, "The Wolf of Wall Street."
Justice Department civil forfeiture complaints seek the forfeiture of property including a Manhattan penthouse and a Beverly Hills mansion, a $35 million private jet and paintings by Vincent Van Gogh and Claude Monet.
The complaint, filed in Los Angeles, alleges a complex money laundering scheme that the Justice Department says was intended to enrich top-level officials of a government-controlled Malaysian wealth fund.
That fund, known informally as 1MDB, was created in 2009 by the Malaysian government with the goal of promoting economic development projects in the Asian nation. Instead, officials at the fund diverted more than $3.5 billion over the next several years through a web of shell companies and bank accounts in Singapore, Switzerland, Luxembourg and the U.S., the complaint alleges.
"In seeking to seize these forfeited items, the Department of Justice is sending a message that we will not allow the United States to become a playground for the corrupt," United States Attorney Eileen Decker, the U.S. Attorney in Los Angeles, said at a news conference. "And we will not allow it to be a platform for money laundering or a place to hide and invest in stolen riches."
Federal officials say more than $1 billion was laundered into the U.S. for the personal benefit of 1MDB officials and their associates. The funds were used to pay for luxury real estate in the U.S. and Europe, gambling debts in Las Vegas casinos, a London interior designer, expensive paintings and the production of films, including the 2013 Oscar-nominated movie "The Wolf of Wall Street."
The Justice Department said it was the largest forfeiture demand under an initiative that seeks to recover foreign bribery proceeds and embezzled funds.
The complaint identifies by name multiple Malaysian nationals that the government alleges profited from the scheme.
Among them is Riza Shahriz Bin Abdul Aziz, who co-founded Red Granite Pictures, a movie production studio whose films include "The Wolf of Wall Street." According to the complaint, eleven wire transfers totaling $64 million were used to fund the studio's operations, including the production of the movie starring Leonardo DiCaprio.
The complaint identified Riza as a relative of a Malaysian official, but did not name the official. He is the stepson of Prime Minister Najib Razak.
"Neither 1MDB nor the Malaysian people ever saw a penny of profit from that film or from any of the other assets that were purchased with funds that were siphoned from 1MDB," said Assistant Attorney General Leslie Caldwell, head of the Justice Department's criminal division. "Instead, that money went to relatives and associates of the corrupt officials of 1MDB and others."
The Justice Department is seeking to seize any royalties and fees owed to Red Granite in the future.
A phone message at the movie studio on Wednesday morning was not immediately returned.
Malaysian government officials had no comment Wednesday in response to queries about the Justice Department action.
But opposition lawmaker Tony Pua said Malaysia has become a laughing stock with the U.S. move as the government had insisted that no money was missing from the fund. He said the government must open up investigations into the fund and uncover the identity of the Malaysian senior official behind the money laundering.
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Associated Press writer Eileen Ng contributed to this report from Kuala Lumpur, Malaysia.
Follow Eric Tucker at http://www.twitter.com/etuckerAP
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