Just as it was announced at the end of last month that the Obama fundraiser, Frank White, has cut a deal with the US government to return $20 million ‘after learning that the money .. originated from misappropriated 1MDB funds, while he was unaware of the source at the time’, 1MDB watchers received parallel news of similar ‘light touch’ handling by the Swiss authorities of the convicted PetroSaudi fraudster, Patrick Mahony.

The Swiss 1MDB whistleblower, Xavier Justo, has now heard from multiple sources (including those who have spoken to this website) that Mahony, who was allowed to roam free after appealing his conviction and six year jail sentence for PetroSaudi’s theft of hundreds of millions of dollars from 1MDB (yet to be restored), has resettled in the Philippines.

Mahony, who has a UK passport as well as a Swiss passport, was judged by the Swiss court not to be a flight risk, given his family resided at that point in a luxury Gstaad mansion (funded by the ill-gotten gains from Malaysia).

Prosecutors disagreed, however Mahony was de-tagged and returned his travel documents, in order to continue to ply his business whilst the months tick by till his appeal is heard.

Now, sure enough, he and his family have reportedly established themselves in Manilla, thanks to the businessman’s ties with wealthy allies of the Marcos regime.  Before joining PetroSaudi, Mahony had worked for the private equity company Ashmore, which specialises in emerging markets, and had acted as the link man for investments involving key local players who are now believed to be protecting him there.

This has not stopped Mahony from flitting back to Switzerland to show his presence from time to time, and indeed continuing to satisfy his well-known predilections for luxury and glamorous company – he was recently clocked enjoying yet another yachting holiday in the Bahamas.

Justo suspects the lenient approach may well result in a failure to turn up when the time comes to face the reckoning over his extremely solid conviction.  Writing January 31st he doubtless spoke for many Malaysians outraged by recent developments as perpetrators seek to wriggle out of their convictions.

Today, I learned something that left me speechless. Patrick Mahony, despite being sentenced in the 1MDB scandal (6 years in prison and billions of dollars in fines), is living a luxurious life with his family in the Philippines. Meanwhile, I, Xavier Justo-the whistleblower who handed over the critical data to expose this massive fraud-am still under investigation in Switzerland.  How can this be right?
Mahony helped orchestrate a scam that stole billions, money that should have gone to improving lives, building communities, and
offering opportunities to those in need. Instead, it went into private jets, luxury properties, and personal greed. And yet, here he is, free to enjoy a
life of privilege, while the victims – many of whom are still struggling – wait for justice. The Swiss justice system should be admired for
its integrity, but moments like these raise questions that cannot be ignored. [read more]

Justo’s frustration thereby reflects a view that top host countries for corrupt white collar money have an extremely conflicted approach in dealing with such cases, often preferring to keep law and order on their own well manicured streets while turning a blind eye to the foreign crimes behind much of the wealth they manage, such as Mahony’s.

That Justo is still ‘under investigation’ for his ‘release of private information’ – i.e. his whistleblowing on a crime – will offer comfort to prospective kleptocrat banking clients.  However, if and when Patrick Mahony enters a Swiss jail it could send a shiver down their spines.

Indeed, if the United States Department of Justice’s kleptocracy initiative had not pursued the PetroSaudi fraud then the evidence suggests that the Swiss authorities would have failed to act at all.

Sarawak Report had offered the Swiss Attorney General’s office the very same information that we passed to the US DOJ in February 2015, yet received no response whatsoever until the US action was underway.

Likewise, the UK fraud authorities had opined they would take no action on the matter, until the US moved to confiscate property assets across London which were the product of 1MDB money laundering, at which point they too cooperated.

Frank White

Depressingly, even the United States’ role as referee over global money-laundering has now been dealt a temporary, perhaps fatal, blow.

Amongst his many moves to de-stress the lives of the global super-rich over the past two weeks, the new president has reportedly abolished the Department of Justice’s very same Kleptocracy Asset Recovery Unit which flushed out Najib’s record thefts through 1MDB.

He has thereby de-policed global money laundering by politically powerful individuals for the foreseeable future.

Simultaneously, over the past 48 hours the so-called FARA registration rules have also apparently been relaxed to reduce the transparency burdens on foreign agents seeking influence in Washington. Violations previously could invite a jail sentence, however the new Attorney General, Pam Bondi, has deliberately raised the benchmark for such punishment.

The former Obama fundraiser Frank White fell into this category of potential violation, having acted as an agent for Najib, funded by 1MDB.  As part of the deal he brokered with the Department of Justice just three days before Trump took office (perhaps the last of its kind given the changes just announced) he agreed to admit to playing such a role in a re-filing of his so-called FARA registration.

“In conjunction with the agreement announced today, White Jr.’s company, DuSable Capital Management LLC (DuSable), submitted amended filings pursuant to the Foreign Agents Registration Act (FARA). The amended filings disclose additional political activities performed by DuSable for the government of Malaysia, including lobbying the U.S. government to provide non-financial support for a solar project in Malaysia.” [DOJ announcement January 17th]

Originally a businessman in the office supplies industry, Frank White was a key family contact and fundraiser for Barak Obama’s presidential campaigns who had become close to the politically active and celebrated rap singer, Pras Michel – himself one of Jho Low’s carefully curated network of celebrity friends and beneficiaries whom the Malaysian used and often paid to access the corridors of power in the United States.

Sarawak Report had identified the politically connected American’s interest in a lucrative 1MDB contract as long ago as September 2014. We noted his newly incorporated US company, DuSable, had been engaged to help develop the proposed Kedah based solar power project. For a handsome fee of just over half a million dollars DuSable was tasked “to encourage the US Government to provide non-financial support for the [1MDB Solar Power] project” .

It seemed White’s promotional work went further. Sarawak Report later identified in 2015 that White’s key role as an Obama insider and fundraiser had been instrumental in organising the iconic game of golf between the two leaders that Christmas in Hawaii.  We also exposed how 1MDB money from DuSable was finding its way into several democrat political campaigns at the time, in violation of US election finance laws.

Pras Michel was the key link in this arrangement, it has subsequently emerged, passing huge sums from Jho Low to the party through so-called ‘straw donors’ (celebrity friends of Pras who forwarded the donations into democrat campaign coffers), all in order to give the appearance that the stolen foreign influence money had originated from legitimate US citizens.

Within within two weeks of DuSable’s White House connection having been originally exposed by Sarawak Report, Frank White had quietly disengaged and severed all links to Malaysia, but not without making a further even more substantial profit.

The business relationship with 1MDB had developed well beyond PR ties it would be later discovered. By the end of 2015, at the height of the 1MDB scandal, Sarawak Report picked up on reports that White together with Pras Michel had been engaged as ‘investment advisors’ through DuSable to manage a massive $500 million investment fund named Yurus. 

It was a staggering revelation. Moreover, Yurus, based in Washington, was financed by none other than by 1MDB’s collaborator so many of its criminal ventures, the sovereign wealth fund Aabar together with ‘an unnamed partner‘.  Yurus had then entered into a joint venture agreement with 1MDB to co-develop the very same solar power plant project in Kedah.

Neither the rap star nor the political fund raiser were ostensibly qualified for such an extraordinary role, and thus it was, just days after this website had highlighted his connections on September 24th 2014,  that Frank White had pulled out of all these ties to 1MDB.

As a later announcement ‘clarified’, Yurus sold that stake in the solar power project back to 1MDB on Oct 2, 2014 (the plant was never developed) for a whopping $69 million in profit.  On the same date DuSable itself registered the ‘termination’ of its foreign agent relationship with the Government of Malaysia in the FARA database.

As one investment analyst commented to Sarawak Report at the time, “For some reason, which we don’t know, 1MDB wanted the Yurus Fund, managed by Frank White, to make a US$70 million profit in Malaysia”.  They added “[DuSable] doesn’t sound at all like a Private Equity firm, it sounds like a lobbying firm” .

Yurus closed shop within a year without doing any further business and announced it had returned the uninvested funds to Aabar and its mystery collaborator. As the manager of the fund which netted $69 million from the ‘buy out’ by 1MDB, Frank White’s company DuSable is estimated to have earned a fee of at least 20% or well over $10 million in that time.

Now, a full ten years after hightailing it out of the Malaysian deal, Frank White has at least acknowledged the (as yet unbuilt) power plant was yet another 1MDB scam, claiming this was something he only belatedly realised – hence the $20 million he has now ponied up to be returned to Malaysia.

In return, he has escaped the prosecution that faced his colleague Pras Michel who by contrast refused to acknowledge any guilt from his own even wider entanglements with Jho Low which extended well beyond the Obama years.