Malaysian Dirty Money Scandal Reaches White House - Media

Tom Burroughes

17 October 2016

The Malaysia-based money laundering scandal that has already seen two banks banned from Singapore, fines, legal action in Switzerland and investigations elsewhere threatens to cause heartburn in US politics at the highest level.

Federal officials are investigating if money allegedly misappropriated from Malaysian state fund 1Malaysia Development Berhad, or 1MDB, was sent to a US businessman who scheduled a visit to Oval Office for relatives of Malaysian Prime Minister Najib Razak, the Wall Street Journal reported yesterday. The WSJ quoted a number of sources.

Frank White Jr, founder and CEO of investment firm DuSable Capital Management, escorted Najib’s son and stepson to the Oval Office where they met President Barack Obama in December 2013. Property transactions carried out by the stepson, Riza Aziz, in the US are being investigated by federal authorities.

White made a business deal, where about $10 million embezzled from 1MDB could have gone indirectly to him, the WSJ reported, adding that last November, 1MDB paid $69 million to purchase a DuSable unit out of a deal they signed to build solar-power plants.

The 1MDB saga has seen two Switzerland-headquartered banks, BSI and Falcon Private Bank, banned from Singapore; Swiss authorities have initiated legal proceedings against Falcon. Authorities in Luxembourg have also probed financial dealings. Interestingly, the UK has not yet, as far as this news service is aware, become involved.

As has been previously reported, the US Justice Department is seeking to confiscate over $1 billion of assets linked to 1MDB, including 11 luxury properties in the US.