The opposition leaders who filed a suit against Prime Minister Najib Abdul Razak are contending that Najib, as chairperson of 1MDB board of advisers, caused the state-owned fund to issue bonds and raise funds for the purchase of power plants at an inflated price.

The plaintiffs, former opposition leader Anwar Ibrahim, former PKR secretary-general Saifuddin Nasution Ismail and PKR vice-presidents Nurul Izzah Anwar and Tian Chua, further alleged that the issuance of the bonds is favourable to United Arab Emirates-based Aabar Investments PJS and International Petroleum Investment Co (IPIC).

“This is to induce Aabar and IPIC to cause US$681 million (RM2.6 billion) to be paid into Najib’s personal accounts just prior to the 2013 general election. Hence, the said monies, or part thereof, were used by Najib for GE13,” they said in their statement of claim.

Aabar is a diversified investment company with its headquarters in Abu Dhabi, while IPIC was also formed by the United Arab Emirates government in Abu Dhabi in 1984. Aabar acquired Falcon Private Bank in April 2009.

The said funds were transferred from Falcon Bank, based in Singapore, into Najib’s personal accounts.

These four PKR leaders, along with former PAS central committee member Dr Dzulkefly Ahmad (photo) and the party PKR, filed the suit yesterday , naming Najib, BN secretary-general Tengku Adnan Tengku Mansor, 1MDB and the Election Commission as defendants.

“As the purchasing price of the power plant was inflated so as to induce the Genting Group to make a RM37 million payment to Yayasan Rakyat 1Malaysia, from which donation monies were subsequently utilised by Najib in GE13,” says the statement of claim filed by them, which was sighted by Malaysiakini .

They raised Najib’s Arabian connection in the shady deal related to 1MDB.

They claimed IPIC had previously guaranteed bonds issued by 1MDB, totalling billions of dollars, and had also injected a sum of US$1 billion into 1MDB around May or June 2015.

Links to Jho Low

They claimed the original chairperson of the Falcon Bank board was one Khadem Al Qubaisi, who was then Aabar chairperson and IPIC CEO. All Qubaisi was allegedly at the heart of a series of controversial deals with 1MDB and had ties with businessman Low Taek Jho, who is better known as Jho Low.

Mohamed Badawy Al Husseiny succeeded Al Qubaisi as Falcon chairperson and Aabar CEO. Both are said to have been closely involved in all the various deals between Aabar and 1MDB and it was Al Husseiny who made payments into Najib’s account in March 2013.

The plaintiffs further claimed that Tanore Finance Corp, based in the British Virgin Islands, as reported in The Wall Street Journal on July 9, 2015, transferred some US$681 million (RM2.6 billion) to Najib’s personal account.

Tanore remitted the monies through Singapore-based Falcon and the transfers were made on March 21, 2013 (US$620 million) and March 25, 2013 (US$61 million).

The Edge Financial Daily published an article of March 2, this year that in 2012, 1MDB was using its subsidiaries to issue two bonds totalling US$3.5 billion (RM11.55 billion) to finance the acquisition of power assets from Tanjong and the Genting Group.

The subsidiaries were 1MDB Energy Ltd and 1MDB Energy (Langat) Sdn Bhd. The total proceeds, after netting off the expenses and fees to Goldman Sachs and other intermediaries, was US$3.1 billion (RM9.3 billion).

'Borrowing style an expensive move'

The bonds were co-guaranteed by 1MDB and IPIC. The plaintiffs claimed that the IPIC guarantee came at a heavy price because 1MDB agreed to IPIC retaining RM4.25 billion or 45 percent of the nett proceeds of RM9.3 billion, or 37 percent of its gross debt of RM11.55 billion, as refundable security for the guarantee.

IPIC, the plaintiffs alleged, was given a 10-year option to subscribe up to 49 percent of the future listing of the power assets. IPIC transferred the option to its subsidiary, Aabar.

All six plaintiffs further claimed 1MDB’s method and borrowing style was an expensive move, as it only got to keep RM4.27 billion or 37 percent out of the RM11.55 billion raised or borrowed. 1MDB also agreed to share 49 percent of any upside on the power plants it bought via the Aabar options.

In 1MDB’s March 31, 2014, accounts submitted to the Companies Commission of Malaysia in November, the sovereign fund disclosed that the first substantial sum of the US$1.22 billion (RM4.03 billion) redeemed from Cayman Islands was used for debt servicing, working capital and payments to Aabar as ‘refundable deposits’.

In May 2014, 1MDB had taken a bridging loan facility of up to US$250 million to finance the acquisition of the options granted to Aabar; and on May 22 last year, 1MDB and Aabar signed a settlement agreement to terminate the options.

On Sept 2, 2014, Aabar, they claimed, had written to inform 1MDB that it did not wish to exercise the options.

The plaintiffs further claimed that The New York Times reported on Aug 10 last year that Najib’s step-son, Riza Shahriz Abdul Aziz, who co-owned Red Granite Pictures, as saying that the principal film investor for the company (Red Granite) was Al Husseiny.

Red Granite produced the US$100 million budget movie, ‘The Wolf of Wall Street’.

Go here for the statement of claim in full.