Deutsche Bank 1MDB Probe Dropped by U.S. Justice Department
MAY 10, 2021 | REPUBLISHED BY LIT: MAY 11, 2021
The U.S. Department of Justice has dropped a probe into Deutsche Bank AG’s role in the 1MDB scandal, removing a potential legal headache as Malaysia steps up its demands for compensation.
The DOJ sent a letter to notify the German bank that the investigation had been closed, people familiar with the matter said, without specifying the date of the correspondence. The people asked not to be identified discussing the private information.
Representatives for Deutsche Bank declined to comment. A Justice Department spokesman declined to comment.
The move by the DOJ provides relief as Deutsche Bank was named on Monday as a defendant in a lawsuit brought by 1MDB seeking $1.1 billion in payments from the German lender, Bloomberg reported earlier. Deutsche Bank said it hasn’t been served any papers on 1MDB and that it isn’t aware of any basis for a legitimate claim.
The DOJ opened a probe in 2019 assessing whether Deutsche Bank’s role in helping 1MDB raise $1.2 billion five years earlier might have violated foreign-corruption or anti-money-laundering laws, Bloomberg has reported. At the time the investigation was opened, Deutsche Bank pointed to asset-forfeiture documents previously filed by the Justice Department indicating 1MDB misled Deutsche Bank during transactions.
After successfully recouping more than $3 billion from firms including Goldman Sachs Group Inc., Malaysia’s 1MDB is casting a wider net.
MAY 10, 2021 | REPUBLISHED BY LIT: MAY 11, 2021
The state-owned investment fund is suing companies including JPMorgan Chase & Co. and Deutsche Bank AG in an effort to recover assets worth more than $23 billion the country says are linked to the fund.
1MDB and a former unit filed a combined 22 civil suits against entities and individuals for various alleged wrongdoings including fraud and conspiracy to defraud the fund, the Finance Ministry said on Monday.
The suits are the latest twist in Malaysia’s continuing efforts to recover billions of dollars allegedly siphoned from 1MDB by people connected to the country’s former prime minister.
For much of the past decade, authorities have tried to track funds that allegedly flowed from 1MDB into high-end art and real estate, a super yacht and, ironically, the hit Hollywood movie “The Wolf of Wall Street,” chronicling an earlier era of financial crimes.
In a move that broadens the dragnet, at least two suits were filed in London, according to publicly-available court records. Deutsche Bank’s Singapore branch faces a lawsuit, while 1MDB separately sued Citigroup Inc.’s head of commodities research Ed Morse alleging professional negligence, the filing shows.
JPMorgan declined to comment while Deutsche said it hasn’t been served any papers on 1MDB and isn’t aware of any basis for a legitimate claim.
The banks were named earlier on Monday by the Edge newspaper. New York-based Morse declined to comment.
‘Pursuing Wrongdoers’
The Malaysian government has had a string of successes in its recovery efforts, the most high-profile coming last year when Goldman Sachs reached a $3.9 billion pact to resolve probes into the Wall Street giant’s role in the scheme. Goldman’s overall tab for additional settlements with authorities in the U.S., U.K. and Hong Kong swelled to more than $5 billion.
In March, Deloitte PLT agreed to a 324-million ringgit ($80 million) settlement with the Malaysian government to resolve all claims related to the firm’s audit of 1MDB and its former unit SRC between 2011-2014. The deal also came less than a week after Malaysian lender AMMB Holdings Bhd. agreed to a $699 million settlement over its role in dealings linked to 1MDB.
“The Government’s recovery efforts are now focused on pursuing other wrongdoers who have caused losses to 1MDB and or SRC during the execution of their duties, as parties directly or indirectly involved in 1MDB and or SRC’s various operations and transactions,” Finance Minister Tengku Zafrul Abdul Aziz said in a statement.
The specific allegations against Deutsche Bank and JPMorgan weren’t immediately clear. According to court documents, 1MDB is seeking $1.1 billion from the German bank and $800 million from the U.S. firm.
Jho Low
The latest effort comes as a Malaysian court is hearing an appeal by ex-Prime Minister Najib Razak to overturn his conviction and 12-year jail sentence linked to the 1MDB scandal that brought down his government in 2018.
Najib, and the fugitive financier Jho Low and his family are among individuals named in the civil suit. Low, whom prosecutors have accused of orchestrating the fraud, has previously professed his innocence.
“We have not received the summons,” Najib’s lawyer Farhan Shafee said. “We also found out from the press.” M. Purvalen, a lawyer representing Jho Low’s mother, said he has not been approached to represent the Low family in this suit.
Deutsche Bank helped 1MDB raise more than $1 billion in 2014.
JPMorgan in 2017 was reprimanded by Swiss regulators over its handling of money transfers related to 1MDB in previous years.
After successfully recouping more than $3 billion from firms including Goldman Sachs Group Inc., Malaysia’s 1MDB is casting a wider net.
Against All Odds: Elizabeth Callan Received a Mortgage-Free Home from Deutsche Bank
Eventually, Every Outlaw Agreed Deutsche Bank Didn’t Universally Abandon Acceleration, Except Deutsche Bank, who Released the Original Loan.
Ten Buck Bandit: Lawyer Silvia Mintz Files Fraudulent Legal Docs in Harris County Real Property Records
This article will be updated once the foreclosure trustee deed is (or isn’t) posted in real property records.
Eva Morales Sued by DBNTCO and Endures Bottom Feeder Foreclosure Mill Legal Shenanigans
LIT let this latest case percolate in the draft section and what happened on May 2, 2024 was expected, the case would be nonsuited by DBNTCO.
