NEW YORK: US prosecutors brought additional charges against Low Taek Jho, or Jho Low, accused of looting the 1MDB wealth fund, for campaign-finance violations related to President Barack Obama’s 2012 re-election effort.
According to an indictment unsealed Friday in Washington, Low transferred US$21.6 million (RM89.8 million) to Pras Michel, a musician and film producer, who spread approximately US$865,000 among 20 people.
These straw donors, in turn, gave the cash to a presidential fundraising committee without indicating it had come from a foreign source. Michel also sent more than US$1 million to an independent election committee, prosecutors said.
The charges, against both men, show a wide-ranging effort by the Malaysian financier to win influence in the US.
In an indictment last year, Low and Michel weren’t charged but were identifiable as co-conspirators trying to influence the Trump administration as the Justice Department investigated the 1MDB scandal.
Now, the Trump Justice Department says Low’s influence-buying goes back to the previous administration.
During Obama’s re-election campaign, Michel and Jho Low’s father attended a fundraiser in Washington, DC, and sat on each side of Obama, according to the indictment.
Obama’s name doesn’t appear in the indictment, which refers to him only as Candidate A. Nor is there any indication that he or the political groups knew of the foreign efforts or did anything wrong. The straw donors also weren’t identified.
Obama, through a spokeswoman, declined to comment.
The newest charges grew out of the Justice Department’s investigation into fraud and corruption at 1MDB.
Meant to promote economic development in Malaysia, the fund was instead used as a massive slush fund by Low, an adviser to Malaysia’s then-prime minister, Najib Razak, according to US prosecutors and other authorities around the world.
Low was previously charged in the US with conspiring to bribe foreign officials and launder money.
In Malaysia, he has been charged with receiving more than US$1 billion from the state fund in 2009 and 2011, and with multiple counts of money laundering. Low’s whereabouts are unknown.
“Mr. Low is innocent – and he is presumed innocent under US law,” said a spokesman. “Mr. Low has never made any campaign contributions directly or indirectly in the US and he unequivocally denies any involvement in or knowledge of the alleged activities.”
“Mr. Michel is innocent of these charges and looks forward to having the case heard by a jury,” his lawyer, Barry Pollack, said earlier Thursday, responding to a Bloomberg report that the charges were imminent.
The indictment describes efforts by Jho Low to use Michel to get access to Obama at two-big ticket fundraising events during the 2012 re-election campaign.
One, a June event in Miami, required a minimum contribution of US$40,000. Michel failed in an attempt to get last-minute permission for Low to attend, according to the filing.
Three months later, Michel tried to get Low and his father into Obama’s presence at an event in Washington, DC.
The father was allowed in, and during the fundraiser, he and Michel sat on each side of “Candidate A,” according to the indictment. The entry price for that event wasn’t clear.
The men took photos of themselves with the president and also ordered copies of professional photos taken of the event showing them with Obama, according to the indictment.
Although the charges on Friday relate to conduct from 2012, Michel was a central player in the more recent bank-fraud machinations that led to a guilty plea by former Justice Department official George Higginbotham last November, according to court documents filed in that case.
In that scheme, Higginbotham admitted that he conspired to influence US investigations into the looting of 1MDB.
He admitted to falsifying paperwork in 2017 to create bank accounts that were then used to funnel money from “Co-conspirator B” in Asia to “Co-conspirator A” in the US. The descriptions of the co-conspirators match those of Low and Michel.
According to Higginbotham’s plea, he created the false paper trail at the “direction” of Michel.
Higginbotham understood that Michel and Low created these false companies because no US bank would accept funds from Low, who had been identified by the Justice Department in 2016 as the architect of the 1MDB fraud.
Michel, 46, is a musician, actor and producer of records and films who rose to prominence in the 1990s as a member of the Fugees, a hip-hop group that also included Lauryn Hill and Wyclef Jean.
He appeared in and produced several films, including a documentary on homelessness in Los Angeles. His 1998 debut album, “Ghetto Supastar,” included a memorable cameo.
“Hi, this is Donald Trump, and I have no doubt that you are going to be a big success,” the future president said in one interlude. “I hope very soon you’re going to be in the leagues with me. So good luck, man.”
By 2012, Michel was drawn into the orbit of Low, whose parties attracted Hollywood producers, A-list actor Leonardo DiCaprio and music stars including Swizz Beatz and his wife, Alicia Keys.
Similar charges against Michel have emerged before.
In 2016, the Federal Election Commission dismissed charges that Michel made an illegal contribution by funnelling US$875,000 through a limited-liability company he controlled.
The LLC was listed as contributing to the super PAC called Black Men Vote.
The charges against Low and Michel come a few weeks after Attorney-General William Barr received a waiver from the White House allowing him to participate in the investigation and litigation involving 1MDB.
Barr’s former law firm, Kirkland & Ellis, represents Goldman Sachs Group Inc., which is under investigation by federal prosecutors in Brooklyn, New York, for its role in raising more than US$6 billion for the fund.