The missing money has become the subject of a Swiss investigation involving a top executive of Abu Dhabi’s International Petroleum Investment Company.
“If the money is missing, then what was a done deal is now headed towards a dispute,” according to lawyer Lim Chee Wee, former Bar Council president and a member of an anti-corruption advisory panel, quoted by the Straits Times in a report from Kuala Lumpur today.
Last year 1MDB and IPIC entered into an agreement to exchange 1MDB debts and assets with IPIC. Some of 1MDB’s US$3.5 billion deposit and US$940 million investment units would be transferred to IPIC for US$1 billion cash and IPIC assuming all liabilities of 1MDB’s bond holdings of US$3.5 billion.
The deal was to be completed by the end of June.
However IPIC said this week that it did not own the company to which 1MDB said it had sent the money. IPIC said it did not receive any payments from the company, Aabar Investments PJS Limited registered in the British Virgin Islands, which it said was wound up in June last year.
1MDB has said the money was transferred on the instruction of IPIC’s former managing director Khadem Al-Qubaisi and the Aabar Investments chief executive Mohamed Badawy Al-Husseiny.
The two men are believed to be at the centre of a Swiss investigation into fraud, corruption and money-laundering.
1MDB has said it had documents to show that the funds were received, but 1MDB chief executive Arul Kanda Kandasamy acknowledged this week that the company may have been defrauded.
The Straits Times report quoted litigation lawyer Andrew Yong as saying that if 1MDB had the documents to back its claim, then IPIC would be required to honour the deals struck by the former officials.
With time running out for the 1MDB-IPIC deal to be completed, “it will likely go into a dispute that will take years to resolve”, he was quoted as saying.