KUALA LUMPUR (Dec 23): 1Malaysia Development Bhd (1MDB), the former Malaysian sovereign wealth fund embroiled in one of the largest financial scandals in history, and its subsidiaries have initiated legal claims exceeding US$1 billion (RM4.5 billion) against Hong Kong-headquartered corporate services provider Amicorp Group and its co-founder and chief executive officer Toine Knipping.
The claims, filed in the British Virgin Islands (BVI) against eight Amicorp entities, allege that Amicorp played a pivotal role in facilitating the laundering of more than US$7 billion in misappropriated 1MDB funds between 2009 and 2014. Additionally, the liquidator of the 1MDB subsidiaries has filed a further suit on the same facts.
According to a 1MDB statement on Monday, the lawsuits were filed on Dec 20. The claimants accuse Amicorp of fraudulent trading, dishonest assistance in breaches of fiduciary duty, and conspiracy to commit unlawful acts.
They further allege that Amicorp established and managed an intricate network of shell companies, sham transactions, and fraudulent financial structures that disguised the movement of stolen funds. The funds were allegedly funnelled through a global network spanning jurisdictions such as Singapore, Barbados, Curaçao, Hong Kong, and the BVI.
A key element of the claim is the alleged involvement of Amicorp Bank, a bank registered in Barbados that is accused of providing access for the fraud to the global financial system. Amicorp is alleged to have used fund entities and banking services to repeatedly cycle assets through 1MDB’s subsidiaries, creating the illusion that the stolen assets were legitimate investments generating returns, "when in fact they had been misappropriated".
"There is, in our view, strong evidence to suggest that Amicorp — at the highest levels — knew they were involved in a dishonest and illegal money laundering scheme designed to transfer large sums of cash away from its intended beneficiary — the people of Malaysia," a spokesperson for the 1MDB board said in the statement.
"We are confident that our claim will succeed, and are committed to holding accountable the institutions and individuals involved in misappropriating money from Malaysia’s sovereign wealth fund, while ensuring the recovery and restitution of these assets back to the Malaysian people," the spokesperson added.
According to 1MDB, Amicorp has faced scrutiny for compliance failures in several jurisdictions in recent years. Regulatory actions include fines for inadequate anti-money laundering systems and compliance lapses in the Netherlands, Abu Dhabi, Malta, and the BVI.
The Edge has reached out to Amicorp for comment.
The lawsuit against Amicorp and its entities is part of 1MDB’s broader international efforts to recover stolen assets. As of the end of September, a total of RM27.17 billion linked to 1MDB has been recovered and placed in the Assets Recovery Trust Account, according to Finance Minister II Datuk Seri Amir Hamzah Azizan.
The funds have been used to repay 1MDB’s debt and cover other expenses permitted under the trust account directive.
According to the Auditor General’s Report released in October, the federal government has provided a total of RM39.74 billion in guarantees to repay 1MDB’s debts between 2019 and 2023.
Additionally, the federal government will need to allocate another RM9.46 billion to repay the remaining 1MDB debt. This comprises RM5 billion in principal and RM4.46 billion in coupon payments for the Sukuk Islamic Medium Term Notes, which will mature on May 27, 2039.