DUBAI: Two senior executives of an Abu Dhabi fund linked to 1Malaysia Development Berhad have been sentenced to jail for financial crimes, the Wall Street Journal reported, citing people familiar with the matter.
They must jointly pay about US$336 million, half to IPIC, and half as a penalty, according to the criminal court, WSJ reported,.
The two men are Khadem al Qubaisi, who once headed Abu Dhabi’s International Petroleum Investment Co, and Mohammed Badawy al Husseiny, a US citizen who ran a subsidiary of IPIC.
Khadem was sentenced to 15 year’s jail, and Mohd Badawy to 10 years, the WSJ report said. Khadem was convicted of “exploiting his job and unlawfully appropriating 149 million euros after selling shares he owns for the company he heads, without disclosing his ownership of the shares, for 210 million euros.”
However, it quoted people familiar with the case as saying the convictions were not related to the 1MDB scandal.
1MDB and IPIC were involved in a controversy over a US$1.2 billion debt swap agreement and a dispute over a payment of US$3.5 billion that 1MDB was said to have paid an IPIC company, Aaabar, but which was said to have been diverted.
In January, Khadem al Qubaisi told WJS that he was being blamed as the “scapegoat” in the 1MDB scandal. The US Justice Department has alleged that US$4.5 billion was stolen and distributed among a group of co-conspirators, which included Khadem al Qubaisi and Mohd Badawy al Husseiny.