KUALA LUMPUR: The Singapore High Court has granted winding up applications filed for three entities incorporated in the British Virgin Islands and linked to the multibillion-dollar scandal at Malaysian state fund 1Malaysia Development Berhad (1MDB), liquidators recovering assets for 1MDB said on Friday (May 15).
The court decision will enable the liquidators to bring further statutory claims, to be filed soon, against Standard Chartered Bank and BSI Bank in Singapore over their roles in allegedly facilitating the 1MDB fraud, they said in a statement.
The claims would be pursued in addition to other ongoing legal actions brought against the banks, including those related to allegations of “dishonest assistance, breach of the banks’ duties of reasonable skill and care, and/or breach of their banking mandate,” the liquidators said.
Standard Chartered said in a statement that it would defend itself against the claims, adding that the three entities were shell companies used to siphon 1MDB funds.
“More than 13 years ago, these shell companies deceived the bank and abused its services by using their accounts to launder money misappropriated from 1MDB. We will vigorously defend against their attempts to now obtain from the bank the money they paid away,” it said.
The liquidators have said they were exploring workarounds after Singapore’s appeals court in March dismissed their bid to sue the banks for alleged fraud, upholding a lower court ruling.
Singapore’s High Court had dismissed the suit against Standard Chartered and BSI in October last year, ruling that the country’s cross-border insolvency framework could not be applied to the case as the alleged transactions occurred before the law took effect in 2018.
US and Malaysian investigators say about US$4.5 billion was stolen from 1MDB between 2009 and 2014 in a complex scheme that has implicated a former prime minister, as well as high-level officials and top financial institutions around the world.
