JPMorgan Chase agreed to pay the Malaysian government $330 million to settle all outstanding claims tied to its role in the multibillion-dollar 1MDB scandal, both parties said Friday. The agreement marks another major step in Malaysia's yearslong effort to recover billions looted from its sovereign wealth fund.
Malaysia's Finance Ministry said the payment, equivalent to 1.4 billion ringgit, will go directly into the government's 1MDB Assets Recovery Trust Account. "Under the settlement, JPMorganChase will, without admission of liability, contribute RM1.4bil (US$330mil) to Malaysia's Assets Recovery Trust Account," the ministry said in a statement.
The settlement resolves all current and potential legal claims between Malaysia and JPMorgan, including a lawsuit filed by 1MDB in 2021 against JPMorgan (Switzerland) Ltd. That case, which also named Deutsche Bank and Coutts & Co., sought up to $800 million for alleged "negligence, breach of contract, conspiracy to defraud/injure, and/or dishonest assistance." As part of the settlement, each side agreed to withdraw pending appeals.
In a joint statement, JPMorgan and Malaysia confirmed the agreement "resolves all existing and potential claims and binds both parties from any future claims or litigations related to 1MDB." JPMorgan said it welcomed the outcome. "Since then, we've enhanced our controls, earning the trust of regulators in Switzerland and beyond," the bank said.
The announcement came the same day Swiss prosecutors fined JPMorgan's Swiss unit 3 million francs ($3.71 million) for failing to prevent money laundering linked to 1MDB. The Swiss Attorney General's Office said the bank was guilty of "failing to take all reasonable and necessary organisational measures" in its dealings. The probe centered on two oil company executives convicted last year of embezzling more than $1.8 billion from the Malaysian fund.
The scandal, which ran from 2009 to 2014, saw at least $4.5 billion misappropriated from 1MDB, according to Malaysian and U.S. investigators. Proceeds were used to buy luxury real estate, art, and finance the Hollywood film "The Wolf of Wall Street." The fallout implicated major financial institutions and toppled former Malaysian Prime Minister Najib Razak, who was jailed in 2022 after being convicted of corruption and money laundering. Najib has denied wrongdoing.
Malaysia says it has recovered about 29.7 billion ringgit ($7.03 billion) through settlements with institutions including Goldman Sachs and Deloitte. Officials say additional recovery efforts remain underway as Kuala Lumpur presses claims against other parties linked to the fund.
