FOR the past year 1MDB—a Malaysian state investment firm at the heart of one of the world’s biggest financial scandals—has been locked in dispute with IPIC, a sovereign-wealth fund from the oil-rich emirate of Abu Dhabi, with which it was once chummy. Terse statements released on April 24th suggest the pair are finally making up. 1MDB has agreed to pay IPIC $1.2bn, reportedly to settle a complaint that it reneged on the terms of a bail-out IPIC provided in 2015. The two companies have also agreed to enter into “good-faith discussions” about other disputed payments, which may total as much as $3.5bn.
Past dealings between 1MDB and IPIC are a focus for investigators hunting huge sums that have gone missing from the Malaysian state-owned company since its founding in 2009. In 2012 IPIC offered to guarantee loans that 1MDB needed to acquire two power firms. But IPIC said last year that it had never received collateral and other monies supposedly due to it under this deal. Instead 1MDB appears to have wired payments to an account held by an unrelated shell company registered in the British Virgin Islands, which had adopted a name similar to that of one of...Continue reading
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