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U.S. to Return $200 Million 1MDB-Linked Funds to Malaysia

Bloomberg logoBloomberg 5/3/2019 Andrea Tan, Edvard Pettersson and Anisah Shukry
a group of people in front of a building: A pedestrian walks past the Kuala Lumpur Courts Complex in Kuala Lumpur, Malaysia, on Monday, Jan. 7, 2019. A Malaysian court denied bail for Roger Ng, a former Goldman Sachs Group Inc. banker who was charged in the country for his role in 1MDB deals while facing extradition to the U.S. for similar allegations.© Bloomberg A pedestrian walks past the Kuala Lumpur Courts Complex in Kuala Lumpur, Malaysia, on Monday, Jan. 7, 2019. A Malaysian court denied bail for Roger Ng, a former Goldman Sachs Group Inc. banker who was charged in the country for his role in 1MDB deals while facing extradition to the U.S. for similar allegations.

(Bloomberg) -- U.S. authorities are preparing to return about $200 million of funds allegedly misappropriated from troubled state fund 1MDB to Malaysia, according to people familiar with the matter.

The total includes about $140 million from the sale of a stake in New York’s Park Lane Hotel and some $60 million from a settlement paid by the producer of the “Wolf of Wall Street” movie, said two of the people, who asked not to be named as the details are private. The transfer could happen as soon as next week, they said.

Malaysian Prime Minister Mahathir Mohamad has reached out to countries from Switzerland to Singapore for help in tracking and recouping the $4.5 billion believed to have been siphoned from 1MDB. The scandal surrounding the state fund, set up to finance development projects in the Southeast Asian nation, has ensnared people and institutions from Malaysia’s former leader Najib Razak to Goldman Sachs Group Inc.

Representatives of the U.S. Justice Department didn’t immediately respond to a request for comment Thursday after regular business hours.

Malaysia pulled in $126 million last month from the sale of a superyacht once owned by Jho Low, the fugitive financier who has been painted as the mastermind behind the scandal. That was the largest amount of money that the country has recovered related to 1MDB, after it received S$15.3 million ($11.1 million) from neighboring Singapore last year. Low has repeatedly denied the allegations against him.

Singaporean authorities are preparing to return about S$35 million surrendered by former Goldman Sachs banker Roger Ng and his family in connection with the 1MDB scandal to Malaysia, people familiar with the matter said separately.

The $140 million stake in the Park Lane hotel, which sits on Central Park South, was sold in February after Low agreed to drop his claims on the property. The $60 million was paid by Red Granite Pictures Inc., co-founded by Najib’s stepson Riza Aziz, as part of a settlement with the Justice Department over claims that it financed the “Wolf of Wall Street” movie with funds misappropriated from 1MDB.

This week, the Justice Department said a set of diamond jewelry worth $1.7 million that Low gave to his mother, allegedly using money from 1MDB, will be returned to the U.S. as part of a forfeiture lawsuit.

To contact the reporters on this story: Andrea Tan in Singapore at atan17@bloomberg.net;Edvard Pettersson in Los Angeles at epettersson@bloomberg.net;Anisah Shukry in Kuala Lumpur at ashukry2@bloomberg.net

To contact the editors responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net, Yudith Ho

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.

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