Luxury mansion linked to 1MDB scandal to be sold

KUALA LUMPUR (Reuters): US prosecutors are seeking to sell a US$39mil (RM162mil) Los Angeles mansion allegedly bought by fugitive Malaysian financier Low Taek Jho with money stolen from a state fund, court filings showed.

Low, popularly known as Jho Low, has been charged in Malaysia and the United States for his central role in the alleged theft of US$4.5bil from state fund 1Malaysia Development Berhad (1MDB).

Low, whose whereabouts are unknown, has consistently denied wrongdoing through spokesmen.

In 2017, the US Department of Justice (DoJ) filed civil forfeiture lawsuits on several assets said to have been bought with stolen 1MDB funds, including the mansion near Hollywood’s famed Sunset Strip.

The mansion was now empty and falling into disrepair, costing nearly US$690,000 in maintenance, insurance and taxes annually, US prosecutors and the property’s holding company said on Friday (May 3).

A sale of the property was necessary as "the expense of keeping the property is excessive and/or is disproportionate to its fair market value", the parties said in the filing in a California court.

The money from the proposed sale will be held in a government account pending the outcome of the forfeiture case, they said.

The parties filed a separate request for the court to lift a stay on the forfeiture lawsuit so that the sale can proceed.

Low’s spokesman said in a statement his client was aware of the proposed sale to "preserve the property's value while ensuring the owners’ claims are protected and may proceed in a timely fashion".

“We look forward to the continued amicable resolution of these claims,” the spokesman said.

The DoJ, in the biggest case to date in its anti-kleptocracy programme, is pursuing billions of dollars it says were misappropriated from 1MDB, a state fund founded by former Malaysian prime minister Datuk Seri Najib Razak.

US prosecutors say funds diverted from 1MDB were used by Low and several associates to buy about US$1.7bil in assets including luxury real estate, a private jet, jewellery and art.

The United States this month will return to Malaysia US$200mil recovered as part of the seizure of 1MDB-linked assets, sources have told Reuters.

Najib, who lost power in a general election last year, is facing more than 40 criminal charges related to losses at 1MDB and other government entities. 

He has consistently denied wrongdoing. - Bernama