ABU DHABI • The authorities in the United Arab Emirates have arrested a key figure in an alleged multibillion-dollar fraud related to a Malaysian sovereign wealth fund, the Wall Street Journal (WSJ) has reported.
Mr Khadem Al Qubaisi was arrested last week in relation to an investigation into fraud and corruption, which includes his alleged role in the 1Malaysia Development Berhad (1MDB) affair. No charges have been filed against him, WSJ said in its report yesterday.
The news of the arrest comes days after investigators in Switzerland initiated a probe against Mr Qubaisi, the former head of the UAE government's wealth fund International Petroleum Investment Company (Ipic), for fraud, money laundering and corruption.
A United States Justice Department lawsuit had also named Mr Qubaisi among those under investigation for embezzlement from the Malaysian fund.
Investigators have estimated that US$4 billion (S$5.4 billion) has vanished from 1MDB's coffers, most of which were siphoned off illegally via a global network of shell companies.
Mr Qubaisi is said to be among the directors of one such shell company, and had allegedly received nearly US$473 million into his accounts in 2012, the US lawsuit claimed.
The US, Switzerland and Singapore were drawn into the investigations because of the movement of money through the international banking system.
1MDB also has outstanding payments due to Ipic, which signed a debt swap deal with the fund in May last year.
Yesterday's WSJ report also said that US investigators are currently broadening their probe into Mr Qubaisi's dealings and funds they suspect he took control of through the alleged fraud, according to people familiar with the probe.
The Justice Department filed civil lawsuits last month seeking to freeze about US$100 million of real estate in the US that he allegedly bought with money embezzled from 1MDB, including a US$51 million penthouse in New York's Walker Tower and two mansions in Los Angeles worth a combined US$46 million. The remainder of those funds, more than US$300 million, has not yet been accounted for.
Investigators are also trying to determine if the businessman used funds originating from 1MDB to help finance the world's fifth-biggest yacht, WSJ reported, quoting unnamed sources.
Mr Qubaisi, 45, was removed last year from his job at Ipic. His whereabouts and status were unknown until the arrest.