The Department of Justice said that the U.S. has reached a settlement to recover more than $49 million involving Malaysian sovereign wealth fund 1MDB, Reuters reported. The government of former Malaysian Prime Minister Najib Razak set up the 1MDB fund in 2009. The Justice Department has estimated more than $4.5 billion was siphoned out of Malaysia by high-level fund officials and their associates between 2009 and 2014 in a scandal that has also embroiled Goldman Sachs Group Inc. The DOJ said yesterday that it has settled its civil forfeiture cases against assets acquired by the former managing director of Abu Dhabi’s International Petroleum Investment Company (IPIC), Khadem al-Qubaisi, using funds allegedly misappropriated from 1MDB and laundered through financial institutions in several jurisdictions, including the United States, Switzerland, Singapore and Luxembourg.
Federal prosecutors are mounting a broad search for fraud in emergency lending programs designed to assist businesses battered by the coronavirus crisis, a top Justice Department official said yesterday, the Wall Street Journal reported. The Justice Department “has a lot of leads and there are multiple ongoing investigations of individuals and small businesses,” Assistant Attorney General Brian A. Benczkowski said. Prosecutors also will apply scrutiny to the activities of banks, which are charged with disbursing the funds in some of the programs, he added. The $660 billion Paycheck Protection Program is getting the most attention now because it is rushing loans out quickly to reach small businesses in dire need of liquidity. Prosecutors also plan to look for problems in other areas, such as loan programs managed by the Federal Reserve that provide loans or other forms of credit support and are partially backstopped by Treasury Department funding, Benczkowski said. A federal criminal complaint unsealed Tuesday in Rhode Island has many of the hallmarks of fraud that prosecutors thought they would see, Benczkowski said. In that case, two men are accused of claiming to have dozens of employees to get PPP loans when in fact they had no workers.
Thousands of victims of Bernard Madoff’s Ponzi scheme are due to get checks totaling $378 million from a U.S. Justice Department fund created years ago through settlements with some of the con man’s oldest customers and his bank, JPMorgan Chase & Co., Bloomberg News reported. The distribution from the Madoff Victim Fund will bring total government payouts in the case to more than $2.7 billion for almost 38,000 investors across the globe, the Justice Department said yesterday. That’s almost 74 percent of their claimed losses, the U.S. said. The fund — which will eventually return more than $4 billion to victims — is separate from the repayment process being overseen by a trustee in federal bankruptcy court in Manhattan, according to the statement. Madoff’s investors lost about $20 billion in principal and more than $40 billion in fake profit when his securities firm collapsed in 2008. He's serving a 150-year sentence in North Carolina after pleading guilty to fraud.