US returns US$156 million in looted 1MDB funds to Malaysia

Najib, who lost the 2018 national election on the back of popular anger over 1MDB and allegations of rampant corruption in his government, was jailed in 2022 for graft linked to a former unit of the state fund.

The latest return of 1MDB funds to Malaysia is the fourth made by the US government, raising the total amount recovered and repatriated to the Southeast Asian nation to around US$1.4 billion, US Ambassador to Malaysia Edgard D Kagan said.

“We are very happy that this fourth tranche of assets from the Justice Department investigations is being transferred back to Malaysia,” Kagan said in a statement released by the US embassy to Malaysia on Thursday.

“This extraordinary sum of money is going back to the people of Malaysia where it belongs and where it can finally be used for its original purpose – to better the lives of everyday Malaysians.”

The 1MDB scandal triggered widespread anger in Malaysia and brought global infamy on the Southeast Asian nation, as investigators exposed how billions of dollars in public funds were used to fund luxury lifestyles of its key players, including fugitive Malaysian businessman Low Taek Jho – better known as Jho Low.

On Wednesday, claimants in a lawsuit against Najib’s wife, Rosmah Mansor, alleged that she had amassed a collection of jewellery, handbags and other luxury goods worth over US$346 million from vendors in at least a dozen countries using 1MDB funds.

Rosmah allegedly bought items using 1MDB money including Swiss ultra-high end watches by Richard Mille, jewellery by Hollywood favourite Lorraine Schwartz and handbags by France’s luxury designer Hermes, according to court documents made available to the media.

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The legacy of Malaysia’s 1MDB scandal on politics and corruption-fighting

Najib, who is currently serving time for corruption linked to 42 million ringgit (US$8.8 million) in funds stolen from former 1MDB unit SRC International, faces at least a dozen more charges across several corruption trials in Malaysia related to the investment vehicle.

But even from jail, he has continued to spark controversy. Najib filed an application in April to serve the remainder of his term under house arrest, claiming it was in line with a supplementary decree by the former king – who had in January halved the ex-premier’s 12-year jail term and reduce his fine to 50 million ringgit from 210 million ringgit.

The scandal also triggered separate investigations in several other nations. In April, Swiss prosecutors charged two managers of Saudi-owned PetroSaudi for commercial fraud for allegedly creating a scheme in 2009 where 1MDB and their firm would set up a joint venture on false premises.

US and Malaysian authorities remain on the hunt for Low, who made headlines for hosting wild parties with celebrities in America, funding Hollywood blockbuster The Wolf of Wall Street and gifting a see-through grand piano to supermodel Miranda Kerr.

Low is widely believed to have sought refuge in China. Malaysian officials have said that they are aware of his whereabouts, but have declined to say where.

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