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US DoJ nears settlement with Jho Low in 1MDB forfeiture case

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Via Financial Times

Jho Low, the Malaysian financier at the centre of the 1MDB scandal, has struck a deal with the US Department of Justice that would resolve a number of civil forfeiture lawsuits targeting assets worth almost $1bn, according to a person familiar with the matter.

The settlement, which would require approval by the courts, had been agreed in principle and was expected to be filed this week, the person said. The deal would help resolve a multibillion-dollar corruption scandal that rocked Malaysia and implicated Goldman Sachs.

Mr Low was indicted in the US last year and still faces criminal prosecution for his alleged role as the mastermind behind the looting of 1MDB, the Malaysian investment fund. He has denied any wrongdoing.

The settlement includes over $10m in legal fees for Mr Low’s attorneys, the person familiar with the matter added.

A spokesman for Mr Low, who remains at large, declined to comment. A justice department spokesman declined to comment. The settlement was first reported by Bloomberg.

The 1MDB investment fund was set up in 2009 by Najib Razak, the former Malaysian prime minister now on trial in Malaysia. It subsequently raised $6.5bn in bonds with the help of Goldman Sachs, much of which was allegedly stolen.

The US first launched a wave of forfeiture lawsuits aimed at cash looted from 1MDB in 2016 as it sought to recover money that had flowed into luxury real estate, expensive art and the production of Martin Scorsese’s The Wolf of Wall Street.

Last year, along with the indictment of Mr Low, the US brought criminal charges against two Goldman Sachs bankers. In Malaysia, the bank itself and 17 current and former executives have been criminally charged.

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Goldman Sachs has challenged the charges in Malaysia, where the government is demanding billions of dollars to settle the case. In the US, the bank is also negotiating a possible settlement with the justice department.

Career prosecutors in the US recommended that any settlement with Goldman Sachs include a guilty plea to a criminal charge by the parent entity of the bank, the Financial Times reported earlier this year.

The bank has denied any knowledge of wrongdoing connected to 1MDB by senior management, arguing it was the result of rogue employees who hid their activities from compliance.

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