The U.S. is moving forward with a criminal investigation into money stolen from a Malaysian state investment fund that allegedly was used to acquire about $1.7 billion in real estate, art, jewelry and other assets.
Court filings by the Justice Department Thursday show the U.S. is escalating its probe in a worldwide effort to track how much of the money that was raised by 1Malaysia Development Bhd. was used to pay for luxury real estate in New York, London and Beverly Hills, film productions, private jets, yachts and more.
Justice Department officials asked a judge in Los Angeles to put on hold civil forfeiture lawsuits against assets acquired by Malaysian financier Low Taek Jho, also known as Jho Low, and others involved with 1MDB because pursuing these cases may hamper the criminal investigation.
The U.S. investigation is part of a global effort to track how much of the $6 billion that 1MDB raised for development projects was allegedly embezzled or involved in money laundering. Switzerland, Singapore and Luxembourg are among the countries also investigating the roles played by banks and individuals.
Separately, 1MDB paid $350 million to an Abu Dhabi sovereign wealth fund on Thursday ahead of an Aug. 12 deadline, the Malaysian Insight reported, citing bankers it didn’t identify. The payment is part of an arbitration settlement agreement with International Petroleum Investment Co. after a debt dispute that brought up further allegations of missing funds and possible fraud.
‘Destruction of Evidence’
An FBI agent warned in a U.S. court filing that information disclosed in the civil cases may reveal “potential targets and subjects of the investigation and the investigative techniques that have been and will be used in the investigation.”
"Such disclosures could result in the destruction of evidence, flight of potential subjects and targets, or the identification and intimidation of potential witnesses," according to the agent’s declaration.
Thom Mrozek, a spokesman for the U.S. attorney in Los Angeles, had no immediate comment on the Justice Department’s filings.
In its civil cases, the U.S. has alleged that from 2009 through 2015, more than $4.5 billion belonging to 1MDB was diverted by high-level officials of the fund and their associates.