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Malaysia will freeze US$340m PetroSaudi funds linked to 1MDB

[KUALA LUMPUR] Malaysia granted an interim order to prevent US$340 million of funds allegedly linked to 1MDB from being moved from Petrosaudi International's accounts in the UK.

The judge has set Aug 28 for the next hearing on the forfeiture lawsuit filed by Malaysia's government against PetroSaudi and its director Tarek Obaid. Tarek had previously been charged in his absence with engaging in criminal conspiracy with the country's former leader Najib Razak and with illegally receiving US$300 million from 1MDB.

"This is the first step, to freeze the account, the next step is to bring the money back," said Nizamuddin Hamid, a lawyer for the Malaysian Anti-Corruption Commission. The money has been moved to an escrow account held by Clyde & Co in London and the commission will submit a mutual legal assistance request to UK authorities to freeze the funds, it said in a statement.

The 1MDB scandal has sparked global investigations into corruption and money laundering with prosecutors estimating that about US$4.50 billion was siphoned from the Malaysian investment fund.

Since Mr Najib was ousted in 2018, the country has reopened investigations and sought to find the billions of dollars missing from 1MDB. It has brought back US$600 million with help from US authorities and recouped millions of dollars more with assistance from neighbouring Singapore.

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Mr Najib's party has since returned to power following a political turmoil in February that ended with the appointment of Prime Minister Muhyiddin Yassin. Mr Muhyiddin has pledged to continue fighting corruption and working with authorities around the world to recoup the funds, even as his government faced backlash for striking a deal with Mr Najib's stepson to drop a different set of 1MDB-related charges.

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