Lies told by a Swiss national, who was jailed here this week over the 1Malaysia Development Berhad scandal, denied the authorities vital clues to Malaysian tycoon Jho Low’s alleged role in the saga.
Prosecutors said that when the central bank here shut down Falcon Private Bank last October over its role in the 1MDB scandal, it had not been made aware of the extent of Mr Low’s involvement in several accounts managed by the bank.
Former Falcon branch manager Jens Sturzenegger’s lies had misdirected money laundering probes into suspicious 1MDB transactions and hid Mr Low’s role as the true controller of the accounts, they said.
Mr Low is being accused by the authorities worldwide of being at the heart of alleged massive money laundering linked to 1MDB. Hundreds of millions of dollars were allegedly transferred from accounts at Falcon to him and his associates.
Had the Monetary Authority of Singapore (MAS) known Mr Low was orchestrating suspicious transactions of about US$1.265 billion into two accounts at Falcon, this would have “added to its adverse findings” against the bank, which was shut down and fined $4.3 million on Oct 11.
According to court papers, Sturzenegger was “extremely apprehensive” at the sudden inflow of “astronomical” sums into the Falcon accounts in March 2013. He called his boss, Mr Eduardo Leemann, who in turn called Mohamed Ahmed Badawy Al-Husseiny, Falcon’s then chairman and former CEO of Abu Dhabi sovereign wealth fund Aabar Investment PJS, and Mr Low, and told them the supporting transaction documents were a “joke” and “ridiculous”.
Although Sturzenegger suspected that the inflows were related to money laundering, he did not report the suspicious transactions to the MAS. Instead he feigned ignorance about Mr Low’s involvement and tried to misdirect the investigations away from him to his close associate, Mr Eric Tan Kim Loong.
In asking for a “retributive and deterrent” sentence against him, Deputy Public Prosecutor Leong Weng Tat said Sturzenegger had “persistently maintained his false statements to MAS and the commercial affairs department over the course of more than a year”. Even after he was arrested on Oct 5 and released on bail, he “showed absolutely no compunction in lying even when confronted with evidence”.
Sturzenegger was sentenced to 28 weeks’ jail and fined $128,000 on Wednesday after he pleaded guilty to six of 16 counts, including consenting in the bank’s failure to comply with anti-money laundering rules. The other charges were taken into consideration.