Two executives from PetroSaudi, an oil exploration company, have been sentenced by the Swiss Federal Criminal Court for their involvement in embezzling over $1.8 billion from Malaysia’s state investment fund, 1MDB. The court found Patrick Mahony and Tarek Obaid guilty of setting up a joint venture with 1MDB under false pretenses, ultimately defrauding the fund. Obaid received a seven-year prison sentence, while Mahony received six years.
The executives, along with fugitive Malaysian financier Jho Low, allegedly siphoned $1.83 billion from 1MDB between 2009 and 2015. They used the money to purchase real estate, jewellery, and further their business interests. 1MDB has filed a lawsuit against Mahony seeking the return of the embezzled funds. Malaysian and US investigators estimate that a total of $4.5 billion was embezzled from 1MDB, implicating multiple high-profile individuals.
Last year, a former Goldman Sachs manager was sentenced to 10 years in prison for his role in the scandal. The US Department of Justice has helped recover $1.4 billion in 1MDB funds for Malaysia. The scandal has involved corruption at the highest levels, including former Malaysian Prime Minister Najib Razak and Goldman Sachs staff.
The 1MDB board has praised the Swiss court’s verdict, stating that it represents justice for the people of Malaysia who were defrauded. The complexity of the case and the extensive global ramifications highlight the need for continued investigation and prosecution of those involved in the scandal.
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