Standard Chartered Plc is facing a $2.7 billion lawsuit from liquidators alleging it played a role in enabling the laundering of billions of dollars misappropriated from Malaysian sovereign wealth fund 1MDB, as per a Bloomberg report.
The suit, filed in Singapore on Monday, represents the latest attempt to recover money taken from 1MDB as part of a decade-long hunt that has involved several of the world’s largest banks
Liquidators began legal proceedings against the UK-headquartered bank in Singapore, according to a statement released on Tuesday. In a statement given to the Financial Times, the bank said it had not yet received the claim documents. It said it “emphatically rejects any claims” made by the 1MDB companies, adding that the liquidators had publicly stated they were “shell companies with no legitimate business”.
“Any claims by these companies are without merit and Standard Chartered will vigorously defend any lawsuit commenced by the liquidators,” the bank said. StanChart added that it had made “significant investments” in its anti-money laundering controls and standards.
Standard Chartered had reported the transaction activities of the 1MDB companies, shut these accounts in 2013 and fully cooperated with the investigating authorities, the bank said.
The claimants allege that Standard Chartered Bank permitted more than 100 intrabank transfers between 2009 and 2013 that helped to conceal the flow of stolen funds. Such transfers led to the loss of more than $2.7 billion for the claimants, as well as S$20 million ($15.7 million) in public funds, according to the liquidators’ statement.
One of the biggest frauds of all time
The 1MDB scandal was one of the biggest financial frauds in history, with stolen funds estimated to have exceeded $4 billion.
The fraud also led to the prosecution of Malaysia’s prime minister at the time, Najib Razak. He was convicted and ultimately sentenced to six years in prison. It also involved several of the biggest banks across the US, Europe and Asia.
Last month, Tim Leissner, the disgraced former Goldman Sachs banker at the heart of the affair, was sentenced to two years in prison by Brooklyn’s federal court. Liquidators at financial services firm Kroll, which is coordinating the 1MDB recovery efforts, have identified more than $2.7bn that flowed through StanChart accounts, including payments to Najib and purchases of jewellery and luxury goods for his family members, according to people briefed on the lawsuit, as per an FT report.
Singapore authorities imposed a S$5.2 million fine against Standard Chartered in 2016 for anti-money laundering breaches related to the case. Other banks were also fined.
(With Bloomberg inputs)
The suit, filed in Singapore on Monday, represents the latest attempt to recover money taken from 1MDB as part of a decade-long hunt that has involved several of the world’s largest banks
Liquidators began legal proceedings against the UK-headquartered bank in Singapore, according to a statement released on Tuesday. In a statement given to the Financial Times, the bank said it had not yet received the claim documents. It said it “emphatically rejects any claims” made by the 1MDB companies, adding that the liquidators had publicly stated they were “shell companies with no legitimate business”.
“Any claims by these companies are without merit and Standard Chartered will vigorously defend any lawsuit commenced by the liquidators,” the bank said. StanChart added that it had made “significant investments” in its anti-money laundering controls and standards.
Standard Chartered had reported the transaction activities of the 1MDB companies, shut these accounts in 2013 and fully cooperated with the investigating authorities, the bank said.
The claimants allege that Standard Chartered Bank permitted more than 100 intrabank transfers between 2009 and 2013 that helped to conceal the flow of stolen funds. Such transfers led to the loss of more than $2.7 billion for the claimants, as well as S$20 million ($15.7 million) in public funds, according to the liquidators’ statement.
One of the biggest frauds of all time
The 1MDB scandal was one of the biggest financial frauds in history, with stolen funds estimated to have exceeded $4 billion.
The fraud also led to the prosecution of Malaysia’s prime minister at the time, Najib Razak. He was convicted and ultimately sentenced to six years in prison. It also involved several of the biggest banks across the US, Europe and Asia.
Last month, Tim Leissner, the disgraced former Goldman Sachs banker at the heart of the affair, was sentenced to two years in prison by Brooklyn’s federal court. Liquidators at financial services firm Kroll, which is coordinating the 1MDB recovery efforts, have identified more than $2.7bn that flowed through StanChart accounts, including payments to Najib and purchases of jewellery and luxury goods for his family members, according to people briefed on the lawsuit, as per an FT report.
Singapore authorities imposed a S$5.2 million fine against Standard Chartered in 2016 for anti-money laundering breaches related to the case. Other banks were also fined.
(With Bloomberg inputs)
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