1MDB saga: Standard Chartered Bank disputes $3.4 billion claim by liquidators in Singapore
Source: Straits Times
Article Date: 02 Jul 2025
Author: Grace Leong
StanChart said it has not yet received the legal claim documents, and emphatically rejects any claims made by these companies.
More than US$2.7 billion (S$3.4 billion) in alleged misappropriated funds is being sought from Standard Chartered Singapore (StanChart) in a High Court lawsuit filed by liquidators in the 1Malaysia Development Berhad (1MDB) saga.
The suit, which represents the latest wide-ranging effort to recover funds siphoned from Malaysia's sovereign wealth fund 1MDB – from which US investigators claim about US$4.5 billion was stolen between 2009 and 2014 – was brought by court-appointed liquidators Angela Barkhouse and Toni Shukla from financial services firm Kroll.
When asked by The Straits Times why the lawsuit was being brought at this juncture, a Singapore-based lawyer for the liquidators declined to comment.
The suit, which was filed on June 30, seeks to hold StanChart accountable for its role in allegedly enabling fraud to be committed against 1MDB and the systematic theft of funds.
Three companies in liquidation linked to 1MDB – Alsen Chance Holdings, Blackstone Asia Real Estate Partners and Brightstone Jewellery – alleged that between 2009 and 2013, StanChart permitted over 100 intra-bank transfers that helped conceal the flow of stolen funds and chose to overlook obvious red flags regarding these transfers.
The suit claims that in doing so, the bank failed to comply with Singapore's anti-money laundering (AML) regulations and client due diligence rules.
StanChart, in a statement on July 1, said: 'Any claims by these companies are without merit and Standard Chartered will vigorously defend any lawsuit commenced by the liquidators.'
The suit claims that the three companies lost over US$2.7 billion and $20 million in public funds.
StanChart, in response to ST's queries, said it has 'not yet received the legal claim documents, and emphatically rejects any claims made by these companies'.
The liquidators who are making these claims have publicly stated that these companies were shell companies with no legitimate business and were linked to fugitives Low Taek Jho and his associate Eric Tan Kim Loong, StanChart said.
They operated under false pretences, and acted as a conduit for funds misappropriated from 1MDB to launder monies, the bank said.
According to the lawsuit, the transfers demonstrate serious breaches and control failings that ultimately enabled the theft of public funds by people operating at the highest levels of the Malaysian government during that period.
The account held by Blackstone Asia Real Estate – a firm owned by Tan – allegedly disbursed US$150 million directly to the personal bank account of Najib Razak, the former prime minister of Malaysia who has since been jailed for corruption and money laundering.
Some US$4.7 million was disbursed to jewellery, watch and bag vendors to pay for the luxury goods purchased by Najib's wife Rosmah Mansor.
Another US$1 million allegedly went to Red Granite Pictures, a movie production and distribution company controlled by Rosmah's biological son Riza Aziz, to pay for movie development expenses, among other things.
An account held by Alsen Chance Holdings disbursed US$53.4 million to jewellery, watch and bag vendors to pay for Rosmah's luxury goods purchases, and another US$38.75 million to Red Granite Capital.
The account held by Brightstone Jewellery disbursed US$77.2 million to jewellery, watch and bag vendors to pay for Rosmah's luxury goods purchases.
According to the suit, these amounts, along with the nature of the money flows, are evidence of how StanChart had failed to conduct the anti-money laundering safeguards.
In 2016, the Monetary Authority of Singapore (MAS) imposed financial penalties of $5.2 million on StanChart and required that disciplinary action be taken against its officers who failed to perform their duties, following findings of significant lapses and serious regulatory breaches.
A spokesperson for the 1MDB board said on July 1: 'The Malaysian people were the true victims of this global fraud, and all parties are determined to hold every facilitator to account – including financial institutions that failed in their most basic duties of vigilance and responsibility.'
StanChart, in its statement, pointed out that the transactions at issue date back to 2010.
'We reported the transaction activities of these companies, both before and at the time we shut their accounts in early 2013, and fully cooperated with the investigating authorities,' it said.
'As set out in the MAS' December 2016 media release on the penalties on StanChart for 1MDB-related AML breaches, MAS concluded their inspection of StanChart in relation to 1MDB-related fund flows.
'While MAS identified regulatory breaches, the inspection did not find pervasive control weaknesses or wilful misconduct at Standard Chartered,' the bank said.
'Standard Chartered takes our responsibility to fight financial crime extremely seriously. We have made significant investments in strengthening our controls and uplifting our AML standards, and will continue to do so,' it added.
Source: The Straits Times © SPH Media Limited. Permission required for reproduction.
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