Three British Virgin Islands-based companies linked to 1MDB on April 6 filed for Chapter 15 bankruptcy in Florida with the aim of recovering a portion of the US$8.5 billion allegedly stolen from 1MDB. — Reuters pic
KUALA LUMPUR, April 7 — A group of offshore entities that were once conduits for billions of ringgit looted from 1MDB are being repurposed to try to track down the Malaysian sovereign wealth fund’s stolen money, Bloomberg reported this morning.
Three British Virgin Islands-based companies linked to 1MDB on April 6 filed for Chapter 15 bankruptcy in Florida with the aim of recovering a portion of the US$8.5 billion (RM35 billion) allegedly stolen from 1MDB.
The section of the US code allows foreign debtors to bring proceedings in the states and is designed to help the administrators gather information from those involved in the deals, and seize whatever assets they’re able to locate.
Some of the money may be in the US, the companies were quoted as saying.
In the court filing, the offshore entities were said to be “part of the fraud perpetrated against 1 Malaysia Development Berhad”.
A few of them were likely created solely to receive stolen funds or transfer them on to other entities. The funds are now being overseen by administrators appointed by the Malaysian government, the newswire reported citing court papers.
“The overseers for the funds ‘have identified various individuals and entities located in the United States who either participated or otherwise possessed knowledge’ related to the transactions at issue, according to court papers,” Bloomberg reported.
“Some of the missing funds passed through US entities, including investment managers, fund managers and other US entities who provided services to the participants in the fraud.”
The US Justice Department’s efforts to recover funds stolen in the scheme have seen some success, according to the entities that made the court filings, but they believed some US$1.15 billion (RM4.85 billion) stolen from 1MDB subsidiary SRC Malaysia had fallen through the cracks.
SRC International is said to be the parent of the funds behind Tuesday’s filing.
The move comes as a jury in Brooklyn, New York, will decide the fate of former Goldman Sachs banker Roger Ng, who was accused of conspiring with his former boss, Tim Leissner, and Malaysian financier Low Taek Jho to loot 1MDB.
Leissner pleaded guilty and testified against Ng. Low remains a fugitive.