Swiss Federal Criminal Court convicts two executives for embezzling $1.8bn from Malaysia’s 1MDB
-
Loading... - Willow Cook
- 29 Aug 2024
- 53 Views
- 0 Like
- 0 Comment
The Swiss Federal Criminal Court has convicted two executives from PetroSaudi, an oil exploration company, for embezzling over $1.8 billion from Malaysia’s state investment fund, 1MDB. This ruling marks another chapter in the far-reaching 1MDB scandal, an international corruption case that has involved multiple financial institutions and individuals since allegations first emerged in 2015.
Prosecutors alleged that Swiss-British national Patrick Mahony and Swiss-Saudi national Tarek Obaid deceived 1MDB’s board into a joint venture by falsely claiming that their company was backed by the Saudi Arabian government. They persuaded 1MDB to invest in the scheme in 2009, and subsequently, they siphoned off funds, with Obaid taking at least $805 million and Mahony $37 million.
Obaid received a seven-year prison sentence, while Mahony was sentenced to six years. The court also ordered the seizure of their assets, including properties in Switzerland and the UK, and over $240 million in various bank accounts, which are to be returned to 1MDB.
The prosecutors outlined that the pair worked closely with Jho Low, a Malaysian financier linked to former Malaysian Prime Minister Najib Razak, who is currently in prison for his role in the scandal. The executives initially extracted $1 billion from 1MDB to purchase a stake in their venture and continued to siphon off another $830 million between 2010 and 2011 through an Islamic loan associated with their partnership.
To facilitate the laundering of stolen funds, Mahony and Obaid arranged for Swiss bank accounts to be opened between 2009 and 2015, using the money to purchase luxury properties, jewelry, private equity, and to finance the PetroSaudi business. Prosecutors highlighted their lavish lifestyle, fueled by the misappropriated funds.
1MDB’s board welcomed the verdict, emphasizing the importance of holding Mahony and Obaid accountable. “Today’s judgment is a further step towards recovering the harm done to the people of Malaysia. We will continue to pursue those responsible for the looting of 1MDB and recover our nation’s rightful assets, wherever they may be,” said a spokesperson for the board.
