In March 2013, a young Malaysian financier sent a heads-up to an employee at a Kuala Lumpur bank that “681 American pies” would soon be arriving from overseas.
The sender, Jho Low, emphasized the need for secrecy, according to a transcript of BlackBerry instant messages reviewed by The Wall Street Journal. The employee, he wrote, should tell the bank’s chief executive that “PM” didn’t want his name, address or identity-card number to appear on the transaction.
Within days, $681 million arrived in two transfers at AmBank Bhd. to be deposited in the personal account of Malaysian Prime Minister Najib Razak, according to documents seen by the Journal.
Global investigators believe those transfers represent a portion of the money diverted from a Malaysian state economic-development fund called 1MDB over several years, according to people familiar with probes in two countries. As they dig deeper, investigators have increased their estimates of siphoned funds to as much as $6 billion, a sharp increase from a few months ago, said a person familiar with one country’s probe.
…Mr. Najib has said he did nothing wrong and derived no personal gain from transfers into his account. Earlier this year, Malaysia’s attorney general said the $681 million deposited in the prime minister’s account was a legal donation from a member of the Saudi Arabian royal family, most of which was later returned, and cleared Mr. Najib of wrongdoing.
AmBank didn’t respond to a request for comment.
A year later, Aabar and 1MDB entered into their own arrangement. Aabar’s parent, an Abu Dhabi sovereign-wealth fund, guaranteed bonds issued by 1MDB. In return, 1MDB agreed to make a payment to Aabar as collateral for the risk, according to 1MDB financial statements.
Rather than send money to Aabar, however, the 1MDB fund ended up transferring $3.5 billion to a different company with a name nearly identical to Aabar’s, according to the report by Malaysia’s parliamentary committee.
Some of that money in turn was transferred, via intermediaries, to a shell company called Tanore Finance Corp., registered in the British Virgin Islands, investigators in two countries believe.
The beneficial owner of Tanore when it was first set up was Tan Kim Loong, a young Malaysian business associate of Mr. Low’s, according to people familiar with the matter. Attempts to reach Mr. Tan were unsuccessful.
Global investigators believe it was from Tanore that $681 million was transferred to Malaysian Prime Minister Najib’s accounts at AmBank in March 2013, according to the people familiar with the investigations.
In all, more than $1 billion was deposited in the prime minister’s accounts over several years, including $200 million from a Saudi individual and the Saudi finance ministry, according to Malaysian investigative documents. Last week, the kingdom’s foreign minister told a TV interviewer he was aware of a Saudi donation, without giving details such as the donor, date or size.
Later, Mr. Najib sent millions of dollars from the account to local politicians ahead of national elections in the spring of 2013, which his party narrowly won. Mr. Low helped campaign in Penang, his home state, and directed how the political financing was spent, according to a politician in Malaysia’s ruling coalition.
The prime minister, over a few years, also spent at least $15 million of money linked to 1MDB on personal expenses, including jewelry and clothes, according to bank records reviewed by the Journal.
source: Wall Street Journal