Swiss cite two Emiratis in Malaysian fraud case

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In the criminal proceedings involving Malaysia’s state investment fund 1Malaysia Development Berhad (1MDB), the Swiss attorney general has named two former Emirati officials in charge of Abu Dhabi sovereign funds. 

The Swiss Office of the Attorney General (OAG)External link has also sent two requests for mutual legal assistance to Luxembourg and Singapore – following a request to Malaysia in January. 

The criminal investigation conducted by the OAG has revealed serious indications that funds of Malaysian state companies have been misappropriated. The $4 billion (CHF3.8 billion) was earmarked for economic and social development projects in Malaysia. The Swiss investigation opened in August 2015. 

So far four cases involving allegations of criminal conduct and covering the period from 2009 to 2013 have come to light in this connection (relating to Petrosaudi, SRC, Genting/Tanjong and ADMIC), each involving a systematic course of action carried out by means of complex financial structures. 

This extension of criminal proceedings pertains to the Genting/Tanjong chapter and involves fraud, criminal mismanagement, misconduct in public office, forgery of a document, bribery of foreign public officials and money laundering. 

According to a statement released by the OAG on Tuesday, 1MDB subsidiaries issued two series of bonds to finance investments in electric power plants. This chapter of the proceedings covers the circumstances under which these subsidiaries obtained the guarantee to repay these bonds from an Abu Dhabi sovereign fund. 

“The Swiss authorities have elements in hand allowing them to suspect that the amounts paid in connection with this guarantee were not returned to the Abu Dhabi sovereign fund that supported the commercial risk. To the contrary, these funds would have benefited others, particularly two public officials concerned, as well as a company related to the motion picture industry. A former 1MDB body, already indicted in the Swiss proceedings, has also benefited from these amounts, stated the OAG. 

Calling this an “extraordinary move”, the Basel-based Bruno Manser Fonds (BMF)External link said on Tuesday: “This announcement is a clear hint that the OAG has evidence connecting 1MDB to Red Granite PicturesExternal link, a film production company set up by Riza Aziz, the stepson of Malaysian Prime Minister Najib Razak.” Documents leaked last year suggested some $700 million deposited into Najib’s accounts may have come from entities linked to 1MDB.

Bruno Manser was a Swiss activist who lived in Malaysia’s tropical rainforest in Borneo with the Penan people. Until his disappearance in 2000, he fought for their right to the land in the face of deforestation. BMF campaigns on behalf of rainforest issues.