This article first appeared in The Edge Financial Daily, on April 14, 2016.

KUALA LUMPUR: 1Malaysia Development Bhd (1MDB) said recent statements by Abu Dhabi sovereign fund International Petroleum Investment Corp (IPIC) and the Office of the Attorney-General of Switzerland (OAG) indicate that the strategic fund could be a victim of fraud.

“1MDB is exploring all avenues open to us,” said 1MDB president and chief executive Arul Kanda Kandasamy in a statement yesterday. “Further announcements will be made in due course,” he added.

On Monday, IPIC and its subsidiary Aabar Investments PJS (Aabar) denied having any stakes in a British Virgin Islands company with a similar name as the IPIC subsidiary and referred to as Aabar BVI.

In a statement to the London Stock Exchange, they said neither of them have received payments from Aabar BVI nor have assumed any liabilities on behalf of Aabar BVI.

IPIC and Aabar also said that publicly available records showed that Aabar BVI was wound up and dissolved in June 2015.

1MDB, however, maintains that payments totalling about US3.5 billion it made to Aabar BVI between 2012 and 2014 have been clearly recorded in the fund’s financial statements.

Meanwhile, OAG said it has “elements in hand” allowing it to suspect that money paid for the guarantee of bonds issued to fund 1MDB’s power plants was not returned to Aabar BVI.

“To the contrary, these funds would have benefited others, particularly two public officials concerned as well as a company related to the motion picture industry,” it said in a statement on Tuesday.

The Wall Street Journal, in a series of articles, had alleged that Red Granite Pictures, the production company behind the Oscar-nominated film The Wolf of Wall Street, had obtained the capital to produce the movie after receiving funds diverted from 1MDB.

The chairman of Red Granite Pictures is Prime Minister Datuk Seri Najib Razak’s stepson Riza Aziz.

Red Granite Pictures has repeatedly denied that the movie, which received five nominations at the 2014 Academy Awards, was funded by capital from 1MDB.

Arul Kanda, in his statement yesterday, “categorically and unequivocally” denied any prior knowledge that Aabar BVI has been liquidated, apart from what “I have read in recent press reports.”

“I challenge YB Tony to provide proof of this malicious accusation,” he said in response to a statement earlier in the day by opposition lawmaker Tony Pua on the matter.

Pua had asked: “How can Arul Kanda not know that the US$1.367 billion of ‘refundable security deposit’, US$993 million of ‘refundable options termination payment’ and an additional US$1.15 billion of ‘top-up security deposit’ have been paid to a company which has already ceased to exist”.

“In fact, all the 1MDB agreements signed with Aabar [BVI] as disclosed by the Auditor-General and the PAC (Public Accounts Committee) are now completely void.

“The announcement made by IPIC on the London Stock Exchange has confirmed without a doubt that not only is the US$3.51 billion above unaccounted for, the money is definitely ‘missing’, as we have suspected all these while,” claimed Pua.

“The question now is why did Arul Kanda hide these information from Malaysians and fail to institute action against the relevant parties in the obscene scam, including 1MDB officials involved, the fake Aabar (BVI) and its officers, since Arul’s [Kanda] appointment was in January 2015, six months before Aabar (BVI) was liquidated.

“If he hid these crucial information, then he must be investigated for being an accessory to the entire scam,” added Pua.

In his response, Arul Kanda said the PAC report on its investigations into 1MDB, which Pua as a member of the committee collectively approved, has now been tabled in Parliament.

“PDRM (the Royal Malaysia Police) have confirmed investigations are ongoing. YB Tony should stop cherry-picking and let the authorities do their job,” he added.