Disgraced former Malaysian Prime Minister Najib Razak appeared in court Wednesday over corruption accusations related to the sprawling 1MDB scandal, as on the same day, the country’s government finally began the process of recouping some of the nearly $5 billion allegedly stolen from the fund.
Malaysian officials said Wednesday they would sell a luxury superyacht belonging to the alleged mastermind of the 1MDB financial scandal for about half its estimated value. Prosecutors claim the 91.5-meter (300 foot) Equanimity, was bought by Malaysian financier Jho Low with a portion of the billions allegedly embezzled from 1MDB, the country’s sovereign wealth fund set up by former PM Najib.
News of the sale came as Najib appeared in court for the first time for the much delayed start of his trial over alleged corruption and abuses of power in connection with the scandal. Both he and Jho Low – who remains at large – deny any wrongdoing.
Najib pleaded not guilty to all charges against him, as Attorney General Tommy Thomas promised to prove that the former PM, who once held “near absolute power” is not “above the law.”
The Equanimity, bought by Jho Low in 2014, included an on-board hospital, space for 26 guests and 33 crew, as well as a sauna, steam room, and swimming pool, according to designers Oceanco.
It was valued at around $250 million, but will sell for the relative bargain price of $126 million, Thomas said Wednesday. That is the largest amount so far recouped from the 1MDB scandal.
Thomas said that Genting Malaysia Berhad, a holdings firm, will purchase the yacht, which Malaysia seized in 2018 and has struggled to get rid of.
An auction last year fell through, and upkeep of the yacht was reportedly costing the government over $1 million a month, making its sale a pressing issue.
The superyacht is only one of many luxury items bought with money allegedly stolen from the 1MDB fund, including jewelry and handbags worth millions of dollars, paintings by Picasso and Basquiat, and property in New York and Los Angeles.
Embezzled money was also allegedly used to fund the production of “The Wolf of Wall Street,” a film starring Leonardo DiCaprio about financial wrongdoings.
In a statement, Jho Low’s lawyers said the Equanimity was “owned by Equanimity (Cayman) Ltd,” and criticized the “bargain-basement sale price” accepted by the government of Prime Minister Mahathir Mohamed.
“It took the Mahathir Government twice as long as they promised to sell the yacht, the auction flopped and the ‘transparent’ sales process the Mahathir Government committed to at the outset has been subject to multiple abrupt changes – largely forced on the Government through their own incompetence,” the statement said. “The Mahathir Government has shown that they are prepared to trash the value of the Equanimity in a misguided attack on their political opponents.”
Massive alleged fraud
Billions of dollars were allegedly stolen from the 1MDB fund over the years, laundered through a variety of offshore and dummy accounts around the world.
Blame for the huge scandal has largely fallen on Najib, whose dramatic election loss in May last year set the scene for this week’s corruption trial.
Within days of the stunning election loss, Najib and his wife were barred from leaving the country. Police soon raided their properties and seized millions of dollars in luxury goods allegedly linked to the 1MDB funds.
In July 2018 – three years after the first 1MDB stories began emerging – Najib was charged with four counts of corruption. The charge sheet was later expanded to cover dozens of other alleged crimes.
His wife, Rosmah Mansour, whose spending with funds allegedly embezzled from 1MDB had helped fuel public outrage, was arrested months later.
Both the former first couple’s trials have been repeatedly delayed, however, as Najib has remained an important political figure and seen something of a reinvention as a “man of the people” critic of the new government.
Analysts said that Najib’s best bet for avoiding jail, considering the vast array of charges against him, is to hope his allies are returned to power at the country’s next election in 2023, if the trial is still going on then.