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AP Photo/Ambros Boli Berani
Ill-gotten gains.
RIGHTING THE SHIP

An expensive souvenir of 1MDB corruption has sailed back to Malaysia

By Tripti Lahiri

It has a massage room, a sauna, a helicopter landing pad, a cinema, and gold-leaf fittings. Its name is Equanimity and it’s a $250 million souvenir of a quickly unraveling multibillion-dollar Malaysian corruption scandal. Now, the 300-foot super-luxury yacht has sailed back to Malaysia, docking at the country’s Port Klang Tuesday (August 7).

It’s the latest 1MDB win for the new Malaysian government elected in May and headed by 93-year-old prime minister Mahathir Mohamad, who has put his full weight behind the investigation and prosecution of a corruption scandal dating back to 2009. That was the year former prime minister Najib Razak oversaw the establishment of 1Malaysia Development Bhd., a state fund that was supposed to attract investment and help Malaysia develop. Instead, billions of dollars were siphoned away from it and squandered on art, real estate, diamonds, and the movie rights to something called Dumb and Dumber To.

Soon after the election, Najib, Mahathir’s one-time protegé, was arrested and charged with criminal breach of trust. Najib has denied any wrongdoing, as has the fund.

The return of the yacht comes after the US Justice Department, which has also been investigating 1MDB, last June filed a forfeiture petition (pdf, p. 2) for the yacht, and for a long list of other assets linked to the 1MDB corruption scandal. US prosecutors alleged that it was purchased by mysterious financier Jho Low in an intricate series of transactions with $250 million in laundered funds. Mr. Low, whom investigators believe orchestrated the corruption at the state fund, couldn’t be reached for comment.

Reuters
Officers from Malaysia’s Attorney Generals Chambers and the High Court inspect the yacht at Port Klang on Tuesday.

According to the Justice Department, Low and his family members flew to the shipyard of Rotterdam-based shipbuilder Oceanco, which built the yacht, for a tour in September 2013. Later, $250 million made its way into a Cayman Islands bank account in four stages between January and June 2014. The ship was built in 2014.

In February, the Equanimity was seized by Indonesian authorities as it sailed to Bali. On Monday, Mahathir thanked Indonesia’s president on Facebook for returning the yacht to Malaysia. Authorities are now expected to take inventory, open it for public viewing, and then sell it off. The US Justice Department has sought to put its own efforts to seize the yacht on hold in the meantime.

Some of the ill-gotten gains purchased with 1MDB funds can never be recovered—for example, the millions of dollars spent on champagne for the celebrities and financiers Low cultivated. But the Equanimity is hopefully just one of many assets that will eventually make their way back to Malaysia.

Update: The story has been updated to note the yacht’s arrival in Malaysia.