Read on Twitter
The 1 Malaysia Development Berhad (1MDB) scandal is the story unprecedented greed and corruption.
1/
While billions of dollars were looted, the Malaysian people did not let it slide its handling carries valuable lessons for Kenya...
---A thread---
1/
While billions of dollars were looted, the Malaysian people did not let it slide its handling carries valuable lessons for Kenya...
---A thread---
2/
1MDB has been referred to as “kleptocracy at its worst” and potentially “one of the greatest financial heists in history,” with more than $4.5billion diverted and looted.
It resulted in investigations in over 7 countries including the US and the UK.
https://corpgov.law.harvard.edu/2019/05/14/goldman-sachs-and-the-1mdb-scandal/
1MDB has been referred to as “kleptocracy at its worst” and potentially “one of the greatest financial heists in history,” with more than $4.5billion diverted and looted.
It resulted in investigations in over 7 countries including the US and the UK.
https://corpgov.law.harvard.edu/2019/05/14/goldman-sachs-and-the-1mdb-scandal/
3/
Worst of all, hundreds of millions of looted dollars were allegedly used to steal an election and keep the corrupt prime minister Najib Razak in power for 5 more years, when his opponents were crushed and at least one prosecutor brutally murdered. https://www.cnbc.com/2015/12/28/wsj-reports-malaysia-pm-najib-razak-used-700m-donation-to-win-2013-elections.html
Worst of all, hundreds of millions of looted dollars were allegedly used to steal an election and keep the corrupt prime minister Najib Razak in power for 5 more years, when his opponents were crushed and at least one prosecutor brutally murdered. https://www.cnbc.com/2015/12/28/wsj-reports-malaysia-pm-najib-razak-used-700m-donation-to-win-2013-elections.html
4/
Background
1MDB was set up in July 2009 by Malaysian Prime Minister Najib Razak, 3 months after he took office. It was supposed to be a "strategic development company driving new ideas and new sources of growth"
Instead, billions of dollars were stolen and misappropriated.
Background
1MDB was set up in July 2009 by Malaysian Prime Minister Najib Razak, 3 months after he took office. It was supposed to be a "strategic development company driving new ideas and new sources of growth"
Instead, billions of dollars were stolen and misappropriated.
5/
In September 2009, 1MDB signed a deal with PetroSaudi International
Former Petrosaudi exec Xavier Justo:
“The company, co-founded by Tarek Obaid in 2005, had few assets and did little, but had its name: ‘PetroSaudi,’ which sounded important" https://www.nst.com.my/news/nation/2018/11/427094/1mdb-petrosaudi-deal-created-steal-money-justo
In September 2009, 1MDB signed a deal with PetroSaudi International
Former Petrosaudi exec Xavier Justo:
“The company, co-founded by Tarek Obaid in 2005, had few assets and did little, but had its name: ‘PetroSaudi,’ which sounded important" https://www.nst.com.my/news/nation/2018/11/427094/1mdb-petrosaudi-deal-created-steal-money-justo
6/
The $2.5bn Joint venture deal between 1MDB and PetroSaudi was struck on the Alfa Nero, a 92-metre long megayacht, off the coast of Monaco.
Obaid and co-founder, Prince Turki bin Abdullah of Saudi Arabia met with Najib and his adviser Jho Low to iron out the details
The $2.5bn Joint venture deal between 1MDB and PetroSaudi was struck on the Alfa Nero, a 92-metre long megayacht, off the coast of Monaco.
Obaid and co-founder, Prince Turki bin Abdullah of Saudi Arabia met with Najib and his adviser Jho Low to iron out the details
7/
Jho Low was a close friend of Razia Aziz, Najib's stepson.
He was a flamboyant, well-educated financier with connections to the wealthy & powerful.
Low came up with the idea of 1MDB, which materialised when his friend's stepdad became Prime Minister https://www.nytimes.com/2015/02/09/nyregion/jho-low-young-malaysian-has-an-appetite-for-new-york.html
Jho Low was a close friend of Razia Aziz, Najib's stepson.
He was a flamboyant, well-educated financier with connections to the wealthy & powerful.
Low came up with the idea of 1MDB, which materialised when his friend's stepdad became Prime Minister https://www.nytimes.com/2015/02/09/nyregion/jho-low-young-malaysian-has-an-appetite-for-new-york.html
8/
Najib was dynastic and had risen through the ranks: MP at 23; chief minister of his home state; minister for education, defense & finance; then deputy PM.
He was the eldest son of Abdul Razak, Malaysia's 2nd PM and nephew of Hussein Onn, its 3rd PM. https://www.bbc.com/news/world-asia-22338100
Najib was dynastic and had risen through the ranks: MP at 23; chief minister of his home state; minister for education, defense & finance; then deputy PM.
He was the eldest son of Abdul Razak, Malaysia's 2nd PM and nephew of Hussein Onn, its 3rd PM. https://www.bbc.com/news/world-asia-22338100
9/
On corruption in Malaysia:
The Razak family is tightly intertwined with Malaysia’s leading political party...
Inflated govt contracts are the norm, widely accepted because recipients simply turn around and donate to the party...
Sound familiar?
On corruption in Malaysia:
The Razak family is tightly intertwined with Malaysia’s leading political party...
Inflated govt contracts are the norm, widely accepted because recipients simply turn around and donate to the party...
Sound familiar?
10/
Three weeks after the deal, $300mn was transferred into the 1MDB-Petrosaudi Joint Venture account and $700mn into an account held by Good Star, a firm owned by Jho Low.
1MDB eventually made payments to Good Star in 2009 & 2011 totalling $1.03bn.
https://www.reuters.com/article/malaysia-scandal-jholow/malaysian-financier-jho-low-owned-firm-linked-to-1mdb-scandal-source-idUSL4N18U2NZ
Three weeks after the deal, $300mn was transferred into the 1MDB-Petrosaudi Joint Venture account and $700mn into an account held by Good Star, a firm owned by Jho Low.
1MDB eventually made payments to Good Star in 2009 & 2011 totalling $1.03bn.
https://www.reuters.com/article/malaysia-scandal-jholow/malaysian-financier-jho-low-owned-firm-linked-to-1mdb-scandal-source-idUSL4N18U2NZ
11/
Totally unrelated: Did Kenya Railways finally pay off the Sh38,000,000,000 invoiced by Africa Star Railway Operation Company Ltd for running SGR?
https://www.nation.co.ke/kenya/news/shocking-details-of-mysterious-local-owners-of-sgr-firm-175402#:~:text=Summary,operator%20was%20to%20earn%20Sh13.
Totally unrelated: Did Kenya Railways finally pay off the Sh38,000,000,000 invoiced by Africa Star Railway Operation Company Ltd for running SGR?
https://www.nation.co.ke/kenya/news/shocking-details-of-mysterious-local-owners-of-sgr-firm-175402#:~:text=Summary,operator%20was%20to%20earn%20Sh13.
12/
The Good Star deal made Obaid, then 32, and Mahony, then 33, very rich men. Records indicate that on 30 September 2009, Good Star agreed to pay $85m to Obaid, which the Seychelles company described as a fee for “brokering services.”
Mahony was a PetroSaudi executive.
The Good Star deal made Obaid, then 32, and Mahony, then 33, very rich men. Records indicate that on 30 September 2009, Good Star agreed to pay $85m to Obaid, which the Seychelles company described as a fee for “brokering services.”
Mahony was a PetroSaudi executive.
13/
Between September 2010 and May 2011, 1MDB agreed to lend an additional $830m to the joint venture with PetroSaudi – bringing 1MDB’s total investment to $1.83bn.
https://www.sarawakreport.org/2016/03/the-petrosaudi-files-fact-or-fraud/
Between September 2010 and May 2011, 1MDB agreed to lend an additional $830m to the joint venture with PetroSaudi – bringing 1MDB’s total investment to $1.83bn.
https://www.sarawakreport.org/2016/03/the-petrosaudi-files-fact-or-fraud/
14/
Meanwhile, Jho Low spent $140m from the joint venture on properties in Hollywood and New York.
Funding for The Wolf of Wall Street movie came from money diverted from the PetroSaudi joint venture.
Incidentally, the movie was banned in Kenya.
https://www.vice.com/en_ca/article/pa8pj8/the-pretend-billionaire-who-threw-insane-parties-for-celebs-and-vanished-1
Meanwhile, Jho Low spent $140m from the joint venture on properties in Hollywood and New York.
Funding for The Wolf of Wall Street movie came from money diverted from the PetroSaudi joint venture.
Incidentally, the movie was banned in Kenya.
https://www.vice.com/en_ca/article/pa8pj8/the-pretend-billionaire-who-threw-insane-parties-for-celebs-and-vanished-1
15/
Enter Goldman Sachs
Goldman raised $6.5 billion for 1MDB from investors around the world. However, more than half of that was reportedly looted by Najib and his friends.
Goldman made a cool $600 million for their trouble.
https://corpgov.law.harvard.edu/2019/05/14/goldman-sachs-and-the-1mdb-scandal/
Enter Goldman Sachs
Goldman raised $6.5 billion for 1MDB from investors around the world. However, more than half of that was reportedly looted by Najib and his friends.
Goldman made a cool $600 million for their trouble.
https://corpgov.law.harvard.edu/2019/05/14/goldman-sachs-and-the-1mdb-scandal/
16/
As an aside, Goldman has quite a history with such crooked deals and was once referred to as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”
[A must read really] https://www.rollingstone.com/politics/politics-news/the-great-american-bubble-machine-195229/
As an aside, Goldman has quite a history with such crooked deals and was once referred to as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”
[A must read really] https://www.rollingstone.com/politics/politics-news/the-great-american-bubble-machine-195229/
17/
"Whistleblower"
Things came to a head in Jan 2015 when PetroSaudi exec, Xavier Justo, leaked 200,000 emails to a reporter after he was stiffed £2mn of a £5mn severance package by Obaid and Mahony.
Things had been toxic at PetroSaudi for a while. https://www.scmp.com/magazines/post-magazine/long-reads/article/2186580/meet-1mdbs-accidental-whistle-blower-his-journey
"Whistleblower"
Things came to a head in Jan 2015 when PetroSaudi exec, Xavier Justo, leaked 200,000 emails to a reporter after he was stiffed £2mn of a £5mn severance package by Obaid and Mahony.
Things had been toxic at PetroSaudi for a while. https://www.scmp.com/magazines/post-magazine/long-reads/article/2186580/meet-1mdbs-accidental-whistle-blower-his-journey
18/
There was an uproar in Malaysia when news of fraud at 1MDB hit the headlines in March 2015.
On July 28, 2015, Najib fired the AG, head of special branch and the deputy PM as allegations of his stealing $700mn from 1MDB engulfed his administration. https://www.latimes.com/world/asia/la-fg-prime-minister-fires-deputy-20150728-story.html
There was an uproar in Malaysia when news of fraud at 1MDB hit the headlines in March 2015.
On July 28, 2015, Najib fired the AG, head of special branch and the deputy PM as allegations of his stealing $700mn from 1MDB engulfed his administration. https://www.latimes.com/world/asia/la-fg-prime-minister-fires-deputy-20150728-story.html
19/
A day after, on July 29, 2015, a fire broke out at Malaysia's police headquarters in Kuala Lumpur, engulfing the offices of key investigation departments where records of white-collar crimes were kept. https://www.straitstimes.com/asia/se-asia/fire-breaks-out-in-malaysias-police-hq-police-chief-says-not-linked-to-1mdb
A day after, on July 29, 2015, a fire broke out at Malaysia's police headquarters in Kuala Lumpur, engulfing the offices of key investigation departments where records of white-collar crimes were kept. https://www.straitstimes.com/asia/se-asia/fire-breaks-out-in-malaysias-police-hq-police-chief-says-not-linked-to-1mdb
20/
With Najib seemingly back in power after the purge, Xavier Justo was arrested and sentenced in August 2015 to 3 years in prison for attempted blackmail.
He was released 18 months later as things continued to fall apart for PM Najib.
https://www.scmp.com/magazines/post-magazine/long-reads/article/2186580/meet-1mdbs-accidental-whistle-blower-his-journey
With Najib seemingly back in power after the purge, Xavier Justo was arrested and sentenced in August 2015 to 3 years in prison for attempted blackmail.
He was released 18 months later as things continued to fall apart for PM Najib.
https://www.scmp.com/magazines/post-magazine/long-reads/article/2186580/meet-1mdbs-accidental-whistle-blower-his-journey
21/
In 2016, the US DOJ filed a lawsuit to seize assets bought with $3.5bn stolen from 1MDB
The DOJ named a Malaysian Official 1 (MO1) over 30 times.
Meanwhile, Malaysia's Deputy Prosecutor Kevin Morais was found dead, encased in a concrete-filled drum. https://www.bbc.com/news/business-37234717
In 2016, the US DOJ filed a lawsuit to seize assets bought with $3.5bn stolen from 1MDB
The DOJ named a Malaysian Official 1 (MO1) over 30 times.
Meanwhile, Malaysia's Deputy Prosecutor Kevin Morais was found dead, encased in a concrete-filled drum. https://www.bbc.com/news/business-37234717
22/
In May 2018, Najib lost reelection to 92-yr old Mahathir Mohamed.
In Sept 2018, Najib was charged with 21 counts of money laundering and 4 counts of abuse of office.
On July 22, 2020 the High Court ordered Najib to pay $550mn to the govt. https://www.straitstimes.com/asia/se-asia/court-orders-former-malaysian-pm-najib-to-pay-550-million-in-additional-income-tax
In May 2018, Najib lost reelection to 92-yr old Mahathir Mohamed.
In Sept 2018, Najib was charged with 21 counts of money laundering and 4 counts of abuse of office.
On July 22, 2020 the High Court ordered Najib to pay $550mn to the govt. https://www.straitstimes.com/asia/se-asia/court-orders-former-malaysian-pm-najib-to-pay-550-million-in-additional-income-tax
23/
Earlier on in June 2018, police had seized over 12,000 items of jewellery, 234 sunglasses from 34 brands, 423 luxury watches from 100 brands and cash - all worth over $300mn - from premises and apartments linked to Najib. https://www.straitstimes.com/asia/se-asia/cash-items-seized-from-former-malaysian-pm-najib-razaks-residences-valued-at-over-300m
Earlier on in June 2018, police had seized over 12,000 items of jewellery, 234 sunglasses from 34 brands, 423 luxury watches from 100 brands and cash - all worth over $300mn - from premises and apartments linked to Najib. https://www.straitstimes.com/asia/se-asia/cash-items-seized-from-former-malaysian-pm-najib-razaks-residences-valued-at-over-300m
24/
In 2019, 17 current and former Goldman Sachs executives were charged by the Malaysian govt and a former partner, Tim Leissner, pleaded guilty to conspiracy to launder money
On July 24, 2020, the firm settled on $3.9bn with the Malaysian govt. https://www.bbc.com/news/business-53529075
In 2019, 17 current and former Goldman Sachs executives were charged by the Malaysian govt and a former partner, Tim Leissner, pleaded guilty to conspiracy to launder money
On July 24, 2020, the firm settled on $3.9bn with the Malaysian govt. https://www.bbc.com/news/business-53529075
25/
In Oct 2019, Low, while on the run, agreed to give up $1bn in assets
As of Feb 2020, fugitives Low, Obaid and Mahony were on Interpol's wanted list
Over $4.5bn was stolen from 1MDB and put into luxury apts, yachts, art, movies, parties & jewellery. https://www.malaymail.com/news/malaysia/2020/02/11/report-macc-puts-in-interpol-request-to-arrest-jho-low-tarek-obaid-and-patr/1836426
In Oct 2019, Low, while on the run, agreed to give up $1bn in assets
As of Feb 2020, fugitives Low, Obaid and Mahony were on Interpol's wanted list
Over $4.5bn was stolen from 1MDB and put into luxury apts, yachts, art, movies, parties & jewellery. https://www.malaymail.com/news/malaysia/2020/02/11/report-macc-puts-in-interpol-request-to-arrest-jho-low-tarek-obaid-and-patr/1836426
