Banker jailed for role in 1MDB saga
A SINGAPOREAN private banker has been jailed on fraud charges relating to Malaysia’s 1MDB financial scandal, becoming the first figure to be convicted in the international multi-billion-dollar saga.
Allegations that huge sums were misappropriated from the Malaysian state fund through moneylaundering have triggered a massive corruption scandal which has embroiled Prime Minister Najib Razak.
Prosecutors said Yak Yew Chee, a former managing director at the Singapore branch of Swiss bank BSI, helped manage funds linked to 1MDB, which was set up by Mr Najib with the help of a close family friend, Malaysian financier Low Taek Jho.
Mr Yak, 57, who was also a private banker to Mr Low, forged reference letters to Swiss banks and funds, and failed to report suspicious money transfers involving accounts belonging to his client, the prosecutors said.
He was sentenced to 18 weeks in jail after pleading guilty to four charges of forgery and failure to report suspicious transactions related to the investment fund.
He was also fined S$24,000 (US$17,000) by the Singapore court.
One of these transactions saw a 1MDB subsidiary transfer $110 million, channelled through six banks and nine accounts, to the Swiss bank account of Selune Ltd, a company US investigators have said is owned by Mr Low.
The banker for the subsidiary, 1MDB Energy, was Falcon Private Bank, whose Singapore branch was shut down by regulators this year.
The complex web of transactions cut across international borders as the money passed through accounts controlled by Mr Low and his father.
The transactions were flagged as suspicious by BSI compliance officers but dismissed by the bank’s senior management who said that “intra-family transfers are not always going to be logical”.
Mr Yak was paid a bonus of S$7.5 million for his dealings that has now been forfeited to the state.
Mr Najib, Mr Low and 1MDB have all strongly denied any wrongdoing.
Before handing down the sentence, judge Jennifer Marie said she hoped “to send a strong signal to the public and errant bankers in particular that the courts will not tolerate such conduct that harms the standing and reputation of the financial institutions of Singapore”.