In a stunning development, Malaysian fund 1Malaysia Development Berhad and its 10 subsidiaries have launched a civil lawsuit against Rosmah Mansor, the wife of former Prime Minister Najib Razak, for allegedly obtaining luxury items worth a staggering $346 million. The plaintiffs accuse Rosmah of using the companies' funds to purchase lavish goods, including jewelry, watches, and handbags, according to Bloomberg.
The lawsuit, filed last Thursday, also names Shabnam Naraindas Daswani as the second defendant, alleging that she had purchased or procured the luxury items on behalf of Rosmah. The plaintiffs assert that funds from 1MDB and its subsidiaries were funneled through various offshore entities and paid via 320 transactions to 48 vendors across 14 jurisdictions, amounting to a total of $346 million, as reported by Malaysian newspaper The Star.
The plaintiffs argue that the goods represent a "traceable substitute" for 1MDB and its subsidiaries' trust property, granting them an equitable proprietary interest in these items, according to The Straits Times. They seek a court declaration affirming their equitable proprietary interest in the goods and their traceable proceeds held by Rosmah, along with an order for her to pay $346 million to the first six plaintiffs, which include 1MDB, SRC International, 1MDB Energy Holdings, 1MDB Energy, 1MDB Energy (Langat), and Global Diversified Investment Company.
The case is set for management on May 24, shedding light on the multibillion-dollar 1MDB graft scandal that implicated Najib and his wife, Rosmah. Established in 2009 during Najib's first year as prime minister, 1MDB was intended to function as a sovereign wealth fund to boost economic development through strategic investments. However, the U.S. Department of Justice alleged that between 2009 and 2014, $4.5 billion was siphoned off from 1MDB, with roughly $1 billion funneled into Najib's personal bank accounts.
A portion of the stolen funds were allegedly used to buy jewelry for Rosmah, including a $27 million pink diamond necklace, according to U.S. lawsuits. In 2018, police discovered a treasure trove of 12,000 pieces of jewelry, 567 luxury handbags from brands like Hermes and Chanel, 423 watches, and $26 million in cash at properties linked to the couple.
Rosmah's legal troubles escalated in September 2022 when she was sentenced to a decade in prison and fined 970 million ringgit ($205.2 million) for seeking and receiving bribes in exchange for government contracts. Around the same time, her husband Najib was also jailed for corruption, marking a significant fall from grace for the once-powerful couple.
The civil lawsuit against Rosmah Mansor is the latest chapter in the ongoing 1MDB scandal, which has sent shockwaves through the global financial community. As the case unfolds, it remains to be seen how the Malaysian courts will handle the allegations and whether Rosmah will be held accountable for her alleged role in the misappropriation of funds from 1MDB and its subsidiaries.
