The Malaysian government is said to be making preparations to shut down the state-owned 1Malaysia Development Berhad fund.
The remaining assets of the scandal tainted fund, which includes highly valued plots of land in Penang Island and prime ares of Kuala Lumpur, will apparently be shifted over to two companies owned by the country’s Finance Ministry.
In an effort to alleviate its substantial debt late last year 1Malaysia Development Berhad (1MDB) disposed of another of its main assets, power plants owned by Edra Energy, the energy arm of 1MDB, to a Chinese firm, China General Nuclear Power Corporation, for just under $4 billion.
Another Auditor
Last week U.K. based Parker Randall became the fourth auditor appointed by 1MDB after Ernst & Young, KPMG and Deloitte Touche Tohmatsu. The appointment was made almost a year after Deloitte had informed the state owned fund that it planned to resign.
However in order to gain approval for the closure plan, the Malaysian government must guarantee 1MDB's creditors and holders of billions of dollars in bonds that it will honour all obligations.
More Fallout to Come
While Bank Negara Malaysia (BNM) has concluded its investigation into the activities of the scandal hit unit, the authorities in Switzerland, Singapore and the U.S. are still working through offences conducted in their relative jurisdictions directly allied with the fund.
In the latest developments connected to the fund, Jens Sturzenegger the the former branch manager of Falcon Private Bank in Singapore,was charged with 16 offences pertaining to 1MDB. Sturzenegger became the fifth person to be charged in the extensive and ongoing probe and is unlikely to be the last.
