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Justice Department Seeks to Recover $540 Million in Missing Assets

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The Justice Department Thursday filed complaints seeking the forfeiture and recovery of about $540 million in assets associated with an international conspiracy to launder funds misappropriated from a Malaysian sovereign wealth fund.

When combined with civil forfeiture complaints filed last year that seek more than $1 billion and civil forfeiture complaints filed last week that seek about $100 million, the case represents the largest action brought under the Kleptocracy Asset Recovery Initiative, said Thom Mrozek of the U.S. Attorney’s office. Assets now subject to forfeiture in the case total almost $1.7 billion, he said.

The complaints filed Thursday seek the forfeiture of Red Granite Pictures’ interest in the movies “Dumb and Dumber To” and “Daddy’s Home”; a condominium in New York City worth nearly $5 million; diamond jewelry; artworks by Picasso and Basquiat; and a $260 million “mega-yacht” called The Equanimity.

According to the complaints, from 2009 through 2015, more than $4.5 billion in funds belonging to 1Malaysia Development Berhad — known as 1MDB — was allegedly misappropriated by high-level officials of 1MDB and their associates, Mrozek said.

The 1MDB organization was created by the government of Malaysia to promote economic development in Malaysia through global partnerships and foreign direct investment, and its funds were intended to be used for improving the well-being of the Malaysian people, Mrozek said.

“These cases involve billions of dollars that should have been used to help the people of Malaysia, but instead was used by a small number of individuals to fuel their astonishing greed,” said Acting United States Attorney Sandra R. Brown. “The misappropriation of 1MDB funds was accomplished with an extravagant web of lies and bogus transactions that were brought to light by the dedicated attorneys and law enforcement agents who continue to work on this matter.”

“We simply will not allow the United States to be a place where corrupt individuals can expect to hide assets and lavishly spend money that should be used for the benefit of citizens of other nations,” Brown said.

As alleged in the complaints, the members of the conspiracy — which included officials at 1MDB, their relatives and other associates — diverted more than $4.5 billion in 1MDB funds.

Using fraudulent documents and representations, the co-conspirators allegedly laundered the funds through a series of complex transactions and shell companies with bank accounts located in the United States and abroad.

The transactions allegedly served to conceal the origin, source and ownership of the funds, and ultimately passed through U.S. financial institutions to then be used to acquire and invest in assets located in the United States and overseas.

The FBI’s International Corruption Squads in New York City and Los Angeles, and IRS Criminal Investigation are investigating the case.

Prosecuting the case are Assistant United States Attorneys John Kucera and Christen Sproule of the Asset Forfeiture Section, Deputy Chief Woo S. Lee and trial attorneys Kyle R. Freeny and Jonathan Baum of the Criminal Division’s Money Laundering and Asset Recovery Section.

A civil forfeiture complaint is an allegation that money or property was involved in or represents the proceeds of a crime. These allegations are not proven until a court awards judgment in favor of the United States, Mrozek said.

Justice Department Seeks to Recover $540 Million in Missing Assets Reviewed by on . The Justice Department Thursday filed complaints seeking the forfeiture and recovery of about $540 million in assets associated with an international conspiracy The Justice Department Thursday filed complaints seeking the forfeiture and recovery of about $540 million in assets associated with an international conspiracy Rating: 0
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