PETALING JAYA: The former head of the Abu Dhabi government financial firm, International Petroleum Investment Company (Ipic), is under investigation by criminal authorities in Switzerland, the Financial Times reported.
The probe is looking into allegations that Khadem al-Qubaisi is part of an international conspiracy to embezzle money from Malaysia’s 1MDB wealth fund.
The financial daily says a letter from Swiss authorities on the investigation states the well-connected Khadem is suspected of fraud, money laundering and corruption.
The Swiss investigation comes hot on the heels of the United States Department of Justice’s (DoJ) civil suits on the embezzling of the funds from 1MDB last month.
The DoJ had filed suits on July 20 saying that over US$3.5 billion was misappropriated from 1MDB.
In its suits, filed in Los Angeles, DoJ said it sought to seize assets “involved in and traceable to an international conspiracy to launder money misappropriated from 1MDB”.
Aside from Khadem, the suits specifically named Riza Aziz, who is Prime Minister Najib Razak’s stepson, Low Taek Jho (better known as Jho Low), and another Abu Dhabi government official, Mohamed Badawy Al-Husseiny.
FT reports that the Swiss investigation also targeted Mohamed Badawy and two former 1MDB officials, particularly highlighting the “damaging fallout for oil-rich Abu Dhabi from its investment business dealings with Malaysia, which drew in leading politicians from both countries”.
Khadem and the other three suspects are also allegedly named in a letter from the Swiss attorney-general’s office to BSI bank, the Swiss-based financial institution which was targeted by Switzerland and Singapore over the multi-billion dollar transactions linked to 1MDB.
According to FT, Khadem is said to have close ties with Sheikh Mansour bin Zayed al-Nahyan, the owner of English Premier League club Manchester City, and brother of Sheikh Khalifa, ruler of Abu Dhabi and president of United Arab Emirates.
Khadem had suddenly left Ipic in April last year after the financial scandal surfaced, and his whereabouts are subject to much speculation, the FT said. Despite his ties with the royal family of UAE, Khadem is also being investigated by Abu Dhabi authorities.
Prosecutors in the US have previously stated that Khadem and Badawy are part of the conspiracy, with help from some 1MDB officials, to transfer part of the proceeds from a 2012 bond issue by the Malaysian state-owned investment fund, to a fake offshore company, amounting to about US$3.5 billion.
The relationship between the Malaysian and Abu Dhabi funds was further strengthened in a March 2013 bilateral “strategic partnership” that led to another contentious US$3 billion bond issue.
Khadem is also said to have benefited personally with US$473 million of the funds ending up in his accounts in 2012, according to the US DoJ, some of which was then used to purchase various assets in the US, including a New York penthouse, FT reported.