MACC lawyer: Forfeiture action against PetroSaudi, Tarek a result of Special Task Force probe on 1MDB

KUALA LUMPUR (July 13): A lawyer representing the Malaysian Anti-Corruption Commission (MACC) said today that the forfeiture action filed by the public prosecutor against PetroSaudi International Ltd and its chief executive officer Tarek Obaid was borne from the investigations done by the Special Task Force on 1Malaysia Development Bhd (1MDB).

Lawyer Muhammad Nizamuddin Abdul Hamid (pictured) said the former MACC chief commissioner Tan Sri Abu Kassim Mohammad was also part of the task force.

“We (the MACC) also gathered assistance from other international agencies, namely the International Anti-Corruption Coordination Center (IACCC) and the United Kingdom's National Crime Agency (NCA), in tracing the funds, which is the subject matter of this forfeiture exercise,” he told reporters after attending proceedings in court today.

The High Court earlier issued an ad-interim (temporary) order barring Tarek Obaid, PetroSaudi Oil Services (Venezuela) Ltd (PetroSaudi Venezuela) and three others from moving US$340.26 million (RM1.452 billion) to other entities because the money is alleged to be linked to 1MDB. The prohibition order will last until the disposal of an asset forfeiture application by the Malaysian government.

The decision, Muhammad Nizamuddin said, is binding on the respondents and would be relayed to their counterparts overseas.

During proceedings, Nizamuddin also told the court that the forfeiture action follows the criminal charges that had been levelled on Tarek.

Tarek, along with PetroSaudi director Patrick Mahony and fugitive businessman Low Taek Jho (Jho Low), was charged by the MACC last February for engaging in a criminal conspiracy involving former prime minister Datuk Seri Najib Razak and 1MDB.

According to the charge sheet, the criminal conspiracy involved the commission of an offence by Najib for using his position as prime minister, finance minister and 1MDB advisory board chairman to seek gratification for himself involving RM60.63 million.

"On Sept 26, 2009, he (Najib) directed the board of directors of 1MDB which was having a special meeting at The Royale Bintang Damansara, Petaling Jaya, in the state of Selangor, to pass a resolution authorising 1MDB to participate in a joint venture with PetroSaudi International Ltd by investing in the capital of 1MDB PetroSaudi Ltd by subscribing for one billion ordinary shares in 1MDB PetroSaudi at US$1 each for a total consideration of US$1 billion (or equivalent in ringgit)," the charge sheet claimed.

Subsequently, on May 16, 2011, at 1MDB's office at Level 8, Menara IMC, No. 8, Jalan Sultan Ismail here, Najib caused 1MDB's board of directors to pass a circular resolution authorising an additional RM1 billion (or equivalent in US dollar) investment under the Murabaha financing agreement dated March 31, 2010, with 1MDB-PetroSaudi, it said.

The charge sheet alleged that Obaid, Mahony and Jho Low engaged in the criminal conspiracy between Feb 24, 2011 and June 14, 2011.

Meanwhile, Obaid and Mahony face a separate charge for engaging in money laundering on Sept 30, 2009 at Switzerland-based J.P. Morgan (Suisse) SA involving a sum of US$300 million, being proceeds of an unlawful activity from 1MDB. The charge sheet claimed the money was deposited into 1MDB-PetroSaudi's bank account bearing the number 7619400.

This US$300 million, which is what Malaysian prosecutors are seeking, has now grown to US$340.26 million.

Following the court's decision to grant a temporary freeze order on the US$340.26 million, which is being kept at the escrow international account of Clyde & Co LLP, London, MACC said in a statement that it would convey the order to its counterparts in the UK, for the funds to be frozen.

The MACC further said it believed the funds were linked to a conspiracy to defraud 1MDB that involved Najib, Tarek, Jho Low and other individuals.

Besides NCA and IACCC's involvement in the investigations, the MACC said it had also received cooperation from the United States Federal Bureau of Investigations (FBI), its Department of Justice, the enforcement agencies in Switzerland, and the Attorney-General Chambers here.

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