Swiss Court Convicts Executives for Embezzling $1.8B from Malaysia's 1MDB

The Swiss Federal Criminal Court has convicted two executives, Patrick Mahony and Tarek Obaid, for embezzling $1.8 billion from Malaysia's state investment fund 1MDB. Both men were ordered to repay more than $1.75 billion and received prison sentences. The case highlights a massive international corruption scandal involving high-profile figures.

The Swiss Federal Criminal Court handed down convictions on Wednesday to two executives from an oil exploration company, Patrick Mahony and Tarek Obaid, for embezzling $1.8 billion from Malaysia's state investment fund 1MDB. Both Mahony and Obaid have been ordered to repay over $1.75 billion to the beleaguered fund, which has been at the heart of a global kleptocracy scandal.

The convicted individuals managed to deceive 1MDB's board by falsely claiming their company, PetroSaudi, was supported by the Saudi government. This misrepresentation played a pivotal role in persuading 1MDB to engage in a joint venture that led to significant financial losses. The court noted that Obaid gained at least $805 million, while Mahony secured at least $37 million from the fraudulent activities. They have both been found guilty of fraud, criminal mismanagement, and money laundering.

Obaid received a seven-year prison sentence, whereas Mahony was sentenced to six years, based on the degree of their financial enrichment. Despite the convictions, both men denied their involvement in the crimes, with Obaid's legal team immediately filing an appeal. The court's ruling also ties the executives' actions to fugitive Malaysian financier Jho Low and implicates other high-profile individuals, including former Malaysian Prime Minister Najib Razak.

(With inputs from agencies.)