US Department of Justice officials have asked Deutsche Bank AG and JPMorgan Chase & Co to provide details on their dealings with 1Malaysia Development Bhd, as global investigations into the troubled Malaysian state fund widen.
The US officials also traveled to Kuala Lumpur to speak to senior bankers and other people with close links to the state fund, three people with direct knowledge of the matter told Reuters. They said JPMorgan and Deutsche were not the target of investigations at this stage, but had only been asked to provide details.
The US move marks the latest development in a wide-ranging global investigation across three continents into possible corruption and money-laundering at 1MDB, whose advisory board is chaired by Prime Minister Najib Razak.
Najib has denied any wrongdoing and said he has not taken any funds for personal gain, but opposition leaders and government critics have stepped up calls for him to resign.
The sources spoke on condition of anonymity as they were not authorized to speak to the media. It was unclear how long the US officials were in Kuala Lumpur, or whether they had completed their visit.
A team of lawyers for Deutsche Bank are in Kuala Lumpur preparing the report they intend to submit to the Department of Justice, one of the sources said.
Malaysia’s attorney general, who was hand-picked by Najib, cleared him of all criminal offenses in January, declaring that $681 million that were deposited into his personal bank accounts were a gift from Saudi Arabia’s royal family.
The Wall Street Journal reported in March that more than $1 billion was deposited in Najib’s account and global investigators believe much of it originated from 1MDB.
Deutsche Bank is one of the many global lenders who had dealings with 1MDB, as the energy-to-real estate group expanded rapidly after its inception in 2009. The bank provided a $975 million loan for 1MDB in late 2014, which was repaid last year.
The German bank was also advising the fund on a proposed $3 billion initial public offering of its energy assets, which never took place.
JPMorgan normally acts as a US clearing bank for lenders operating in Malaysia. Its dealings if any with 1MDB were not immediately clear.
The US government is already reviewing Goldman Sachs’ relationship with the Malaysian fund.
Goldman came under fire for the fees it charged for helping 1MDB raise funds through bond offerings. The fund racked up borrowings of about 42 billion ringgit ($11.5 billion), before selling off assets in 2015 to pay down debt. Goldman has declined to comment.
Other international banks that have dealt with the fund are also facing questions.
