Ex-BSI banker trial: Singapore names Jho Low as person of interest in 1MDB-linked probe

Mr Low and two others are being probed by the CAD over a "money laundering case involving billions of dollars in transactions" believed to be linked to 1MDB.
Mr Low and two others are being probed by the CAD over a "money laundering case involving billions of dollars in transactions" believed to be linked to 1MDB.PHOTO: THE STAR/ASIA NEWS NETWORK

Malaysian tycoon Low Taek Jho and two other men are being investigated by police here over money laundering claims linked to scandal-hit Malaysian state fund 1MDB, a court heard yesterday.

This is the first confirmation the trio are being probed by the Commercial Affairs Department (CAD).

CAD officer Oh Yong Yang told the court that the three are "persons of interest" in the "largest money laundering case involving billions of dollars in transactions" believed to be linked to 1Malaysia Development Berhad (1MDB).

Mr Oh said the men - Mr Low, his close business associate Eric Tan Kim Loong and American Mohamed Ahmed Badawy Al-Husseiny - are also being investigated in other jurisdictions.

Mr Low and Mr Tan have been the subject of the CAD probe since last year, he added.

Al-Husseiny is the former chief executive of Aabar Investments PJS, a unit of International Petroleum Investment Company, an Abu Dhabi government fund.

Mr Oh's testimony came on day eight of the trial of former BSI banker Yeo Jiawei on four counts of obstructing justice.

Yeo took the stand yesterday for the first time in the trial and told the court that Mr Low was "the most important client" of former BSI banker Yak Yew Chee, because he introduced BSI to sovereign wealth funds SRC International and 1MDB, which were set up by Prime Minister Najib Razak's government.

Yeo testified: "Low is deemed 'gatekeeper' and key adviser to the sovereign wealth funds. BSI management treat him like the most important client of the bank. Whenever he comes, Hans Peter Brunner (former BSI Asia chief executive) and Yak have to meet him.

"Low only communicated with Yak at BSI. Low is quite particular about maintaining secrecy."

Yeo, under examination by his lawyer Philip Fong, mentioned two "very huge" deals Mr Low had brought to BSI - a US$100 million (S$140 million) deal with SRC in 2011 and a US$2 billion deal with 1MDB unit Brazen Sky in 2012.

Prosecutors said Yeo arranged for his own firm, Bridgerock Investment, and GTB Investment - controlled by his former supervisor Kevin Swampillai - to receive a portion of the referral fees, ultimately paid by Brazen Sky.

Yeo said he met Mr Low for the first time after helping BSI with the 2011 deal that involved setting up a "simple trust structure through a fiduciary fund" for SRC.

"I was told, client will put money in BSI, and then subscribe the money to a fund (called) Enterprise Emerging Markets Fund, and then give the money as a loan to a company identified by the client."

Yeo said he believed the money went to Blackstone Asia Real Estate Partners, a firm owned by Mr Tan.

United States prosecutors have said 1MDB raised funds in two bond offerings in 2012 through Goldman Sachs.

They also stated that more than US$1 billion of the US$1.367 billion that was misappropriated from the bond sales wound up in Mr Tan's Blackstone account in Singapore.

Yeo claimed he had a more minor role in the scheme: "At my level, I'm just taking instructions."

Mr Oh disputed Mr Fong's suggestion that the witness tampering charges against Yeo were not related to the money laundering charges, as they involved referral fees that were channelled through various cross-border bank accounts.

A version of this article appeared in the print edition of The Straits Times on November 11, 2016, with the headline 'CAD names Jho Low as a 'person of interest''. Print Edition | Subscribe