KUALA LUMPUR • A Middle Eastern company has denied any links to a British Virgin Islands (BVI)-registered firm with a similar name that had received US$3.5 billion (S$4.7 billion) from troubled Malaysian investment firm 1Malaysia Development Berhad (1MDB).
Abu Dhabi's sovereign wealth fund, International Petroleum Investment Co (IPIC), and its subsidiary Aabar Investments PJS (Aabar), said in a joint statement the BVI firm that received Malaysia's money, Aabar Investments PJS Ltd (Aabar BVI), "was not an entity within either corporate group".
Both firms said yesterday they had never received payments from the company with the almost identical name, nor assumed any liabilities on its behalf, Reuters reported.
In response to the statement, 1MDB said it was surprised neither firm had any knowledge of 1MDB's payments to Aabar BVI as the payments were "clearly recorded" in the publicly available and audited 1MDB financial statements.
"Further, the amounts paid have been subject of much commentary, starting from 2013 right up to the present. Accordingly, 1MDB finds it curious that IPIC and Aabar have waited until April 2016 to issue such a statement," 1MDB said.
The firm added that its legal agreements were negotiated with Mr Khadem Al Qubaisi, IPIC's managing director and Aabar chairman, and Mr Mohamed Badawy Al Husseiny, the chief executive of Aabar.
The United Arab Emirates' central bank has ordered a freeze on the assets of both men, reported Reuters.
A Malaysian parliamentary probe had earlier established that 1MDB had raised US$3.5 billion in bonds and was supposed to pay US$1.36 billion in security deposits to IPIC's subsidiary Aabar.
Instead, it transferred US$1.36 billion to Aabar BVI as security deposits and made subsequent payments of US$855 million, US$993 million and US$295 million as termination options and security deposit "top-ups".
Despite requests from Malaysia's Auditor-General and the parliamentary Public Accounts Committee (PAC) to submit bank account statements of these overseas transactions, 1MDB had failed to do so.
It had also been unable to provide proof that Aabar BVI was a subsidiary of either IPIC or Aabar, the PAC report stated.
The PAC probe also found that written approval of Prime Minister Najib Razak was required for any and all financial commitments of 1MDB.
Tourism and Culture Minister Nazri Abdul Aziz said it was normal practice for the PM to sign off on documents presented to him.