In the latest development of the 1MDB scandal, two former executives of PetroSaudi have been convicted in a court in Switzerland.
Patrick Mahony and Tarek Obaid have been convicted of fraud, criminal mismanagement and money laundering for their role in the 1MDB scandal, according to a «Reuters» report citing legal proceedings.
A court in the southern Swiss city of Bellinzona sentenced Swiss-British Mahony and Swiss-Saudi Obaid to six and seven years of prison, respectively. The two were also ordered to pay back over $1.75 billion to the 1MDB fund.
Petrosaudi-1MDB Joint Venture
While helping set up a joint venture with 1MDB, prosecutors accused Mahony and Obaid of deceiving the Malaysian fund's board of directors into believing that PetroSaudi had links with the Saudi Arabian government.
$1 billion was allegedly extracted from 1MDB to buy a stake in the venture with another $830 million taken from the fund between 2010 and 2011 as part of a related Islamic loan. Between September 2009 and at least July 2015 the two allegedly arranged for bank accounts to be opened in Switzerland to help launder the funds.
According to the indictment, $1.8 billion was defrauded from 1MDB to enrich Obaid and Mahoney who obtained at least $805 million and $37 million, respectively.
