US Department of Justice remits RM1.9b of seized 1MDB funds to Malaysian government

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The United States (US) Department of Justice (DOJ) has remitted about RM1.9 billion (US$452.36 million) seized in matters related to the 1Malaysia Development Bhd (1MDB) into Malaysia’s Assets Recovery Trust Account, the Ministry of Finance (MoF) said.

To date, the Trust Account – under the custody of the Accountant General’s Department of Malaysia – has received RM16.05 billion of seized and repatriated 1MDB funds.

Any balance in the Trust Account will be utilised to primarily repay and service 1MDB and SRC’s remaining debts.

The government has so far repaid RM12.4 billion of 1MDB’s debt and RM3.1 billion of SRC’s debt. The balance of debts still outstanding, comprising the principal and coupon/ profit/ interest of bonds, Sukuk and term loans, currently total RM39.8 billion (1MDB) and RM2.57 billion (SRC).

“The current balance is sufficient to service 1MDB’s debt obligations for 2021 and 2022 only. This balance excludes the settlement amount of RM2.83 billion that will be received from the Ambank Group and RM336 million from Deloitte PLT1.

“Negotiations are also currently ongoing with KPMG. Once all recovered funds in the Trust Account have been utilised, the government will still have to continue bearing the burden of servicing 1MDB’s debt obligations, which were backed by the government’s Guarantee and Letter of Support when these debts were created,” Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said in a statement today.

Reuters

“This recovery would not have been achieved without the excellent cooperation between the Government of Malaysia and the US Government, particularly with the DOJ. On behalf of the Government of Malaysia, we would like to thank the US Government and look forward to the continued cooperation between us,” Tengku Zafrul added.

The Government’s current recovery efforts are focused on parties who have caused losses to 1MDB and SRC during the execution of their duties, whether through direct or indirect involvement in 1MDB and SRC’s various operations and transactions, as well as those who have wrongfully received SRC monies disguised as CSR activities.

All those involved will be made fully accountable for the wrongdoings caused to the country through their involvement in 1MDB and/or SRC.

Meanwhile, Tengku Zafrul confirmed today that the government is going after auditor KPMG over the 1MDB scandal.

This was after Damansara MP Tony Pua questioned why Putrajaya did not go after KPMG even though Deloitte, another of 1MDB’s auditors, had paid RM336 million in a settlement for its role in the scandal.

Zafrul said the government is currently in negotiation with KPMG for a settlement.