KUALA LUMPUR (Reuters) - The U.S. attorney-general described a multi-billion dollar corruption scandal involving a Malaysian state fund as the worst form of kleptocracy, and said the U.S. Department of Justice (DoJ) was working to provide justice to the victims.

U.S. Attorney General Jeff Sessions waits to speak at the Federalist Society's 2017 National Lawyers Convention in Washington, U.S., November 17, 2017. REUTERS/Joshua Roberts

The DoJ in June filed several lawsuits to seize more than $1.7 billion in assets believed to have been stolen from 1Malaysia Development Berhad (1MDB), a sovereign fund set up by Malaysian Prime Minister Najib Razak.

U.S. Attorney-General Jeff Sessions said on Monday the 1MDB-linked assets accounted for nearly half of some $3.5 billion in total proceeds seized or restrained by the DoJ, tied to money-laundering offences.

“This is kleptocracy at its worst,” Sessions said at a global forum on asset recovery in Washington according to a transcript of his speech posted on the DoJ website, referring to the Malaysian case.

“Today, the U.S. Department of Justice is working to provide justice to the victims of this alleged scheme,” he said.

Sessions said “allegedly corrupt officials” in 1MDB had reportedly spent $200 million on real estate in Southern California and New York, $130 million on artwork, invested $100 million in an American music label and $265 million on a yacht.

“In total, 1MDB officials allegedly laundered more than $4.5 billion in funds through a complex web of opaque transactions and fraudulent shell companies with bank accounts in countries ranging from Switzerland and Singapore to Luxembourg and the United States,” Sessions said.

He did not identify any of the officials he thought were corrupt.

Officials at 1MDB did not immediately respond to requests for comment.

Sessions said the DoJ’s anti-kleptocracy initiative had returned at least $254 million in corruption proceeds to the people of Italy, Khazakhstan and Peru, and millions more to the people of Nicaragua, South Korea and Taiwan, since 2004.

1MDB was once a pet project of Najib, who chaired its advisory board until last year. The fund is the subject of money-laundering investigations in at least six countries including Switzerland, Singapore and the United States.

The U.S. lawsuits have alleged that $681 million of the misappropriated funds from 1MDB was transferred to the account of “Malaysian Official 1”, which U.S. and Malaysian sources have previously identified as Najib.

Najib, who faces a general election next year, has denied any wrongdoing and was cleared of any offense by Malaysia’s attorney general.

U.S. President Donald Trump welcomed Najib to the White house in September, praising Malaysia’s investments in the United States while avoiding any talk of the DoJ’s investigation into the scandal.

Source: Reuters