KUALA LUMPUR (Dec 23): 1Malaysia Development Bhd (1MDB), the former Malaysian sovereign wealth fund embroiled in one of the largest financial scandals in history, has initiated legal claims exceeding US$1 billion (RM4.5 billion) against Hong Kong-headquartered corporate services provider Amicorp Group and its co-founder and CEO Toine Knipping. The claims, filed in the British Virgin Islands (BVI) against eight Amicorp entities, allege Amicorp's pivotal role in facilitating the laundering of more than US$7 billion in misappropriated 1MDB funds from 2009 to 2014.
The lawsuit, announced on Dec 20, accuses Amicorp of fraudulent trading, aiding breaches of fiduciary duty, and conspiracy to commit unlawful acts. The claimants allege Amicorp established and managed an elaborate network of shell companies, sham transactions, and fraudulent financial structures to conceal the movement of the stolen funds. According to 1MDB, the misappropriated funds traveled through various jurisdictions, including Singapore, Barbados, Curaçao, Hong Kong, and the BVI.
A significant aspect of the claims revolves around the alleged involvement of Amicorp Bank, which is accused of providing means for these fraudulent activities to infiltrate the global financial system. 1MDB contends Amicorp used its banking services to create the illusion of legitimate investments generating returns when, in truth, they were entirely misappropriated.
A spokesperson for the 1MDB board stated, "There is, in our view, strong evidence to suggest Amicorp — at the highest levels — knew they were involved in a dishonest and illegal money laundering scheme intended to transfer large sums of cash away from its intended beneficiary — the people of Malaysia." The spokesperson emphasized, "We are confident our claim will succeed and are committed to holding accountable the institutions and individuals involved in misappropriating money from Malaysia’s sovereign wealth fund, ensuring the recovery and restitution of these assets back to the Malaysian people."
1MDB noted Amicorp's history of compliance issues across several jurisdictions, including fines for inadequate anti-money laundering measures and regulatory shortcomings noted in the Netherlands, Abu Dhabi, Malta, and the BVI. This latest lawsuit is part of 1MDB’s global efforts to recover stolen assets, having regained RM27.17 billion linked to 1MDB by the end of September, which has been placed in the Assets Recovery Trust Account.
According to Finance Minister II Datuk Seri Amir Hamzah Azizan, these recovered funds are being utilized to service 1MDB's debts and cover other expenses as permitted under the trust account directive. The federal government has provided RM39.74 billion of guarantees to cover 1MDB’s debt between 2019 and 2023 and must allocate another RM9.46 billion to settle the remaining obligations, including principal and coupon payments for maturing Sukuk Islamic Medium Term Notes.
Legal plants extend beyond the filing against Amicorp. A separate lawsuit was filed by the liquidator of 1MDB subsidiaries, reinforcing the claims made against Amicorp and its wide array of entities. This lawsuit highlights the multi-faceted approach by 1MDB to reclaim assets siphoned off through fraudulent means.
While addressing the inquiry about the lawsuit, 1MDB reiterated the importance of the litigation against influential corporate entities involved in the misuse of Malaysian sovereign assets.
The legal action against Amicorp and its entities is being framed within the broader backdrop of the 1MDB scandal, which has attracted global attention and led numerous criminal investigations across multiple countries, including the United States, Switzerland, and Singapore. This financial debacle saw billions pilfered from 1MDB, used to acquire extravagant items such as luxury real estate, artworks, and even superyachts.
The fallout from the scandal has been immense, resulting not only in substantial financial losses but also political upheaval, leading to the fall of former Prime Minister Najib Razak's government in 2018. Najib is currently serving time for corruption linked to 1MDB and is facing additional legal challenges, including his recent bid to serve the rest of his sentence under house arrest.
Despite the depth of the scandal, the Malaysian government remains committed to transparent legal actions, aiming to restore the public's trust and recover what is rightfully owed to the nation. The recent lawsuit against Amicorp is seen as yet another step toward accountability.
The international ramifications of this case are still pending as investigation bodies from around the globe continue to address the widespread corruption initially highlighted by the 1MDB saga.
