KUALA LUMPUR: 1Malaysia Development Berhad (1MDB) and its four subsidiaries on Wednesday (June 7) obtained permission from the High Court here to proceed with a US$2.795bil (RM12.8bil) lawsuit against an associate of fugitive businessman Low Taek Jho or Jho Low, namely Eric Tan Kim Loong, who was declared bankrupt.
Lawyer Siva Kumar Kanagasabai, who represents 1MDB said, Senior Assistant Registrar Haneefa Ariffin allowed the application of 1MDB, 1MDB Energy Holdings Limited, 1MDB Energy Limited, 1MDB Energy (Langat) Limited and Global Diversified Investment Company Ltd, formerly known as 1MDB Global Investments Limited as applicants at the proceedings of the case today.
Siva Kumar said following the court's decision today, 1MDB's application to continue the lawsuit against Tan could continue even if he is declared bankrupt.
"When a person is declared bankrupt, then court action cannot be continued except with the permission of the court and permission was obtained today by my client," he said when contacted.
1MDB along with its four subsidiaries filed the application on May 2, naming Tan as the judgment debtor and the Malaysian government as the judgment creditor.
In the application, the five companies requested permission to proceed with the lawsuit against Tan on the grounds of several causes of action including breach of trust, breach of fiduciary duty and conspiracy which all occurred before Tan was declared bankrupt on June 14, 2022.
Mohd Hisyamuddin Awang Abu Bakar, as a director of 1MDB through his supporting affidavit filed with the application, claimed that between Oct 1, 2009, and Nov 7, 2014, Tan dishonestly received funds amounting to US$2.795bil without any legitimate commercial purpose.
According to him, Tan should not keep the funds and is responsible for returning the money to the applicants.
On June 14, 2022, Tan was declared bankrupt by the High Court here after failing to pay RM68,334,219.01 in income tax to the government.
Based on the creditor's petition, the government applied for a bankruptcy order to be made with regard to Tan's property as a debtor as he owed the government RM68,334,219.01 including interest and costs.
Previously, 1MDB and its four subsidiaries named Tan, along with Jho Low and four of his family members, namely Tan Sri Larry Low Hock Peng, Puan Sri Goh Gaik Ewe, Low Taek Szen and Low May Lin in a multi-billion ringgit suit filed on May 7, 2021. - Bernama