US Attorney General Loretta E Lynch delivered these remarks at a press conference yesterday to announce “significant kleptocracy enforcement action” to recover more than US$1bn obtained from corruption involving 1MDB.
Good morning, and thank you all for being here….
I’m joined today by Assistant Attorney General for the Criminal Division [Leslie] Caldwell; U.S. Attorney [Eileen] Decker of the Central District of California; FBI Deputy Director [Andrew] McCabe; and Richard Weber, Chief of Criminal Investigation at the Internal Revenue Service. We are here to announce a significant step in our ongoing work to combat global corruption and to ensure that the United States offers no haven to those who illegally use public funds for private gain. Today, the Department of Justice filed a civil complaint seeking to forfeit and recover more than $1 billion in assets associated with an international conspiracy to launder funds stolen from 1 Malaysia Development Berhad, or 1MDB, a company wholly owned by the government of Malaysia.
The $1 billion in assets are just a portion of more than $3 billion that was stolen from 1MDB and laundered through American financial institutions in violation of U.S. law. 1MDB was created by the Malaysian government to promote economic development through international partnerships and foreign direct investment, with the ultimate goal of improving the well-being of the Malaysian people. Unfortunately, a number of corrupt 1MDB officials treated this public trust as a personal bank account.
Our complaint alleges that from 2009 through 2015, these officials and their associates conspired to misappropriate and launder billions of dollars from 1MDB. As my colleagues will explain in further detail, the co-conspirators laundered their stolen funds through a complex web of opaque transactions and fraudulent shell companies with bank accounts in countries around the world, including Switzerland, Singapore and the United States. The funds were then used to purchase a range of assets for the conspirators and their relatives and associates, including high-end real estate in New York and Los Angeles, artworks by Vincent Van Gogh and Claude Monet and a jet aircraft.
Today’s case is the largest single action ever brought by the department’s Kleptocracy Asset Recovery Initiative, which was established by Attorney General [Eric] Holder in 2010 to forfeit the proceeds of foreign official corruption and, where possible, to use the recovered assets to benefit the people harmed. This case, and the Kleptocracy Initiative as a whole, should serve as a sign of our firm commitment to fighting international corruption. It should send a signal that the Department of Justice is determined to prevent the American financial system from being used as a conduit for corruption. And it should make clear to corrupt officials around the world that we will be relentless in our efforts to deny them the proceeds of their crimes.
I want to thank the team of prosecutors and paralegals from the Criminal Division’s Asset Forfeiture and Money Laundering Section and the U.S. Attorney’s Office for the Central District of California, who have worked tirelessly on this matter. I also want to thank the agents from the FBI’s International Corruption Unit and the IRS’s Criminal Investigations Division, who assisted them in this case. And I am grateful to the Criminal Division’s Office of International Affairs for their vital contributions. At this time, I will turn things over to Assistant Attorney General [Leslie] Caldwell, who will speak in further detail about today’s filing.
My own question: What are the Malaysian police and the MACC doing about this? Are they content to leave it all to international investigators to trace and recover the funds and nail the culprits?