Malaysia in bid to restrain PetroSaudi from using alleged 1MDB funds in UK firm
15 Jul 2020

The government has filed an application seeking to prohibit PetroSaudi International and its director Tarek Obaid from using over US$340 million in alleged funds from 1MDB kept in a client’s account of a UK law firm.

In the application filed on July 10, the government contended that the US$340,258,246.87 in Clyde & Co LLP belonging to PetroSaudi and its subsidiary company PetroSaudi Oil Services (Venezuela) Limited was proceeds from unlawful activities.

It cited Section 53 of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (Amla) as basis for its application.

According to the provision, the public prosecutor is allowed to make such a move if he is satisfied that the money was gained from unlawful activities.

Besides the US$340 million, the government is also seeking to bar the use of money kept in a bank account under the name Temple Fiduciary Services Limited.

Malaysian Anti-Corruption Commission (MACC) investigating officer Mohd Afiq Abd Aziz affirmed an affidavit for the application.

He claimed the US$64 million was related to a conspiracy to defraud 1MDB involving Tarek, Low Taek Jho and former prime minister Najib Razak.

“Based on my investigations, I believe that the funds in Clyde & Co LLP, kept at London’s Natwest Bank, would be dispersed soon after the final award concerning the money delivered through an arbitration proceeding,” he said.

He said PetroSaudi Oil Services and Venezuelan government-owned Petróleos de Venezuela had entered into arbitration over a dispute on oil drilling and exploration in the South American nation.

PetroSaudi Oil Services won its bid in the arbitration proceeding, and Petróleos de Venezuela was ordered to deposit US$500 million in Clyde & Co LLP’s bank account.

“Our investigations show that in September 2019, Clyde & Co LLP entered into an agreement to use the money from the arbitration proceedings for purposes such as paying outstanding balances and liabilities, paying the Dutch tax authority, as well as distributing the said money to Tarek, owner of PetroSaudi,” Afiq said.

By Ho Kit Yen, FMT, 14 July 2020

Read more at Free Malaysia Today

Photo (cropped and edited): Khairil Yusof/CC BY-SA 4.0

RiskScreen: Eliminating Financial Crime with Smart Technology

Count this content towards your CPD minutes, by signing up to our CPD Wallet