Multi-year prison sentences for both defendants in the 1MDB trial
Published: Wednesday, Aug 28th 2024, 18:10
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The Federal Criminal Court has sentenced the director of Petrosaudi and his business partner to prison terms of seven and six years respectively. It found them guilty of fraud, qualified money laundering and aiding and abetting dishonest business management.
The presiding judge emphasized the enormous figures involved in this case when opening the verdict on Wednesday. In a first step, 1 billion US dollars had been diverted. That is 1000 million. A scary figure.
The defendants had not presented any valid arguments in court that the outflow of these funds was not a fraud. They must repay 1.75 billion dollars to the Malaysian state fund 1MDB, plus 5 percent interest.
The main defendant must also pay the Swiss Confederation a compensation claim of CHF 450 million, the co-defendant CHF 12 million. The court also ordered the seizure of five properties in Switzerland and London.
Case of international proportions
The Office of the Attorney General of Switzerland (OAG) had demanded prison sentences of ten and nine years respectively for the defendants at the main hearing in April. In a press release issued on Wednesday, it stated that this was an important verdict in very complex criminal proceedings.
In addition to numerous interviews in Switzerland and abroad, the extensive investigation also included the examination of hundreds of thousands of documents, including those from international mutual legal assistance, as well as a comprehensive forensic analysis of the money flows.
The verdict shows that economic crimes are prosecuted regardless of their complexity and sophistication. As soon as a written, reasoned judgment is available, the OAG will decide on how to proceed.
Return of funds
The board of directors of the sovereign wealth fund 1MDB has welcomed the verdict. "We commend the Swiss authorities for their work that led to these convictions," a spokesperson for 1MDB was quoted as saying in a statement from the Swiss representation of the plaintiffs.
Throughout the process, 1MDB has supported the Swiss Attorney General's Office as a defendant to ensure the return of assets to Malaysia, it added.
This included filing criminal charges on behalf of 1MDB, supporting the investigation, participating in the trial, providing testimony and cross-examination and finally securing the return of the frozen assets to Malaysia. In particular, we welcome the order of forfeiture and return of funds and assets.
Between 2009 and 2011, the two businessmen withdrew around 1.8 billion US dollars from the fund using conspiracies, accomplices at 1MDB and false information. In a first step, they transferred around 1 billion US dollars to the accounts of Petrosaudi and one of the best-known 1MDB fraudsters, Jho Low. The court is assuming fraud in this complex of offenses.
For two further payments, the court convicted the defendants of aiding and abetting fraudulent mismanagement. They assisted a member of the management of 1MDB to ensure that the funds were paid out.
This was followed by countless actions to disguise the routes of the money that had flowed. The men were convicted of qualified money laundering due to the enormous effort that the main defendant in particular put into this.
No preventive detention
After the verdict was announced, the criminal chamber ruled in camera that no preventive detention would be ordered for those convicted in the first instance. The court announced this in writing.
The BA had already applied for preventive detention at the main hearing due to the risk of absconding. It is sticking to its decision, the federal prosecutor explained on Wednesday. The main defendant is a Swiss-Saudi dual citizen. His former business partner has British and Swiss citizenship.
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