Malaysian investigators have uncovered details about how fugitive financier Jho Low could have profited from a bond sale worth RM5 billion (US$1.2 billion) by the entity that predated 1MDB.

Malaysian investigators looking at the 1Malaysia Development Berhad (1MDB) scandal have uncovered how Jho Low might have profited from a bond sale in 2009 by the entity that predated 1MBD, involving banks and companies in Thailand and Singapore, Bloomberg reported.

According to Bloomberg, Low and associate Eric Tan are believed to have benefitted to the tune of $126 million from a bond sale by the Terengganu Investment Authority (TIA), an entity set up in 2008 as a sovereign wealth fund with Low as one of its special advisors.

The sale of the bonds, arranged by AMMB Holdings, a sister company of AmBank, was done at a discount to three parties, including a company that had an agreement with Low. Later in the day, the same bonds were resold at a higher price, allowing the original purchasers and Low to benefit from the sale. However, this raised suspicions among the authorities.

Country Group Securities

According to the report, AmBank sold RM3.8 billion in notes to Thailand-based Country Group Securities – a new name in the investigations – as well as RM700 million to a Singapore company and RM500 million to itself. The three parties paid RM87 for 30-year Islamic notes with a face value of RM100, which were sold by AmBank to investors later the same day for RM100 to RM105.

Investigators also uncovered a put option signed between Country Group Securities and ACME Time, based in Singapore, which received US$113 million in May 2009 from the former through an AmBank account for the resale of the TIA notes. ACME Time, whose beneficiaries are Low and Tan, also received US$12.6 million in July 2009, though this is not believed to be linked to the TIA sale.

Low was named by U.S. prosecutors as the mastermind behind the $4.3 billion 1MDB scandal, though he has repeatedly maintained his innocence. Low and Tan are still at large, and have repeatedly denied any wrongdoing. Former Malaysian Prime Minister Razak has 39 charges against him relating to 1MDB and its subsidiarity SRC International.