The former prime minister of Malaysia Najib Razak, convicted in the 1MDB corruption case, can claim back the thousands of seized jewelry pieces, watches and handbags as the prosecution failed to prove they came from illegal activities, according to a Malaysian court.
The High Court of Kuala Lumpur on November 14 ruled that the Malaysian government failed in its last bid to forfeit luxury items seized by the police in 2018 from the former prime minister Najib Razak as part of the 1MDB corruption case.
If the prosecution doesn’t file an appeal, Najib Razak and his wife Rosmah Mansor can claim back the seven Richard Mille watches, 29 Hermès handbags and 2,435 pieces of jewelry previously seized for a value said to be worth 80 million ringgits (17 million dollars).
The government of Malaysia filed a suit in 2019 in order to forfeit the assets seized during a raid at properties linked to Najib Razak. The suit was filed against Obyu Holdings, the company which owned the properties; Najib Razak and the United Malays National Organization (UMNO), the main political party of Malaysia, are third-party claimants.
The government claimed the assets were misappropriated from 1Malaysia Development Berhad funds.
1Malaysia Development Berhad was originally a state fund created to develop the Malaysian economy. But Najib Razak with other people was accused of having used the funds to finance their luxurious lifestyles. The amount stolen from 1MDB was estimated to be 4.5 billion dollars.
The scandal contributed to the loss of the coalition led by Najib Razak in the 2018’s general election after which he lost the position of prime minister he held since 2009. The raid took place soon after the fall of the Barisan Nasional administration, the right-wing coalition led by the United Malays National Organization which stayed continuously in power from 1957 to 2018. Barisan Nasional returned to power in 2021.
Najib Razak was sentenced in 2020 to 12 years in prison and fined 210 million ringgits (46 million dollars) for abuse of power, criminal breach of trust, and money laundering of a subsidiary of 1MDB. The sentence was upheld last August.
But the high court of Kuala Lumpur considered that the prosecution failed to prove the luxury items of this bid were the proceeds of illegal activity.
Najib Razak has always argued his money came from a loan from a Saudi prince. The court also ruled there was no evidence the 3 billion ringgits (653 million dollars) in Najib Razak’s AmBank Islamic account which came from Prince Saud Abdulaziz Al-Saud resulted from unlawful activities.
In September, Najib’s defense claimed three of the seven Richard Mille watches were gifts from companies unrelated to 1MDB funds. The seven watches are worth a total of 4 million ringgits (871,000 dollars). One is worth 1.58 million ringgits (344,000 dollars) and another 500,400 ringgits (109,000 dollars).
Deputy public prosecutor Faten Hadni Khairuddin told the court the prosecution will be considering an appeal to the decision and asked to grant an interim stay of the ruling so that the items are retained pending the appeal process. But the court rejected the request considering the appeal was only potential. The prosecution can also appeal the decision of refusing to grant a stay of the ruling.
In total, the police, during its raid in 2018 at properties linked to Najib Razak, seized approximately 1 billion ringgits (218 million dollars). There were close to 12,000 pieces of jewelry (2,200 rings, 1,400 necklaces, 2,100 bracelets, 2,800 pairs of earrings,1,600 brooches, 14 tiaras), 401 watches, 234 pairs of eyewear, 306 handbags, and cash in various currencies amounting to 114 million ringgits (25 million dollars). This was the largest seizure in all of Malaysia’s history.
But most of the seized assets were not successfully proven to be coming from the state fund 1MDB either and this government bid was the last attempt to seek forfeiture of some of the assets.
The same judge last year had struck out the government’s application to forfeit the 114 million ringgits in cash seized from Najib and Rosmah because the prosecution failed to prove they were misappropriated from 1MDB funds. He ordered the funds to be returned to Umno and Najib. The prosecution didn’t file an appeal.