Switzerland's prosecutor is probing a former Abu Dhabi finance official as part of a wide-ranging investigation into corruption at Malaysian state fund 1MDB, according to a report.
Khadem al-Qubaisi, who previously ran oil-rich Abu Dhabi's International Petroleum Investment Company, or IPIC, is suspected by Swiss officials of fraud, money laundering and corruption, according to a letter seen by the «Financial Times».
This represents a widening of a global investigation into 1MDB and allegations that billions in state funds were siphoned off for private use, ultimately financing luxury New York and Beverly Hills real estate, fine art, and even Hollywood film «The Wolf of Wall Street».
Letter to BSI
According to the «FT», Qubaisi is one of four suspects named in a letter last month from Switzerland's prosecutor, Michael Lauber, to BSI Bank, a small Swiss private bank that investigators have said acted as a linchpin for 1MDB's financial dealings.
Separately, «Sarawak Report» said PetroSaudi founder and Saudi businessman Tarek Obaid is under investigation, as well as two former 1MBD officials, Casey Tang and Jasmine Loo. The investigative blog cited the same letter in its reporting.
Both the prosecutor and the bank declined to comment to the «FT».
Pilfered Bond Proceeds
The investigation also targets a Qubaisi subordinate at IPIC, which also owns Switzerland's Falcon Private Bank, and two former 1DMB officials, according to the paper.
The former head of IPIC's Aabar subsidiary, Mohamed Badawy al-Husseiny, is also named as a suspect in the letter.
Qubaisi and Husseiny are alleged to have conspired with 1MDB officials to pilfer 3.5 billion in proceeds from a 2012 bond to an offshore company which turned out to be fake.
Unrelated Aabar
IPIC guaranteed the bonds, part of a «strategic partnership» between Abu Dhabi and Malaysia. They were issued by Goldman Sachs, also being scrutinized by U.S. officials over 1MDB.
U.S. officials allege that $1.37 billion of the bond proceeds were transferred to a Swiss bank account of a British Virgin Islands-registered business called Aabar Investments PJS Limited, named to create the impression that the entity was associated with an IPIC subsidiary.
Abu Dhabi vs 1MDB
IPIC has since denied any link to the offshore company and is now fighting 1MDB and Malaysia's finance ministry in London over bailout loans granted last year in return for assets. 1MDB has denied any wrong-doing.
Qubaisi was one of Abu Dhabi's most active investors in recent years and led IPIC's investments in assets such as Virgin Galactic and Tesla Motors. Qubaisi is alleged by U.S. authorities to have used 1MDB funds to buy a New York penthouse and other real estate worth $100 million.
