JPMorgan Chase (JPM.N), will pay the Malaysian government $330 million to settle matters related to its role in the multibillion-dollar scandal at state fund 1MDB, both parties said on Friday.
The settlement was announced as Swiss authorities separately found the U.S. bank guilty and fined it for failing to prevent money laundering in its dealings related to 1Malaysia Development Berhad.
Malaysian and U.S. investigators say at least $4.5 billion was stolen from 1MDB in a globe-spanning scheme between 2009 and 2014.
In 2021, 1MDB sued a unit of JPMorgan, along with those of Deutsche Bank (DBKGn.DE), and Coutts & Co, to recover losses from the fund, citing alleged “negligence, breach of contract, conspiracy to defraud/injure and/or dishonest assistance” on the part of the firms.
It had sought $800 million from J.P. Morgan (Switzerland) Ltd, court documents had shown.
A joint statement from JPMorgan and Malaysia on Friday said that the company, without any admission of liability, would contribute the settlement payment to the government’s 1MDB Assets Recovery Trust Account.
“The settlement agreement resolves all existing and potential claims and binds both parties from any future claims or litigations related to 1MDB,” the joint statement said.
Each party will also withdraw all pending appeals connected with the lawsuit previously filed by 1MDB against the JPMorgan unit at the Kuala Lumpur High Court, it said.
The Swiss Attorney General’s Office said on Friday it had found JPMorgan’s Swiss unit guilty of “failing to take all reasonable and necessary organisational measures” to prevent acts of aggravated money laundering in its 1MDB-related dealings, and ordered it to pay a fine of 3 million francs ($3.71 million).
The fine was issued as part of the Swiss federal prosecutor’s investigation into JPMorgan’s dealings with two executives at an oil exploration company, who were convicted by a Swiss court last year of embezzling more than $1.8 billion from 1MDB, the office said in a statement.
JP Morgan said it was pleased to have resolved matters including working with the Malaysian government on past issues related to 1MDB.
“Since then, we’ve enhanced our controls, earning the trust of regulators in Switzerland and beyond,” the bank said in a statement.
The 1MDB scandal has implicated high-level officials, banks, and financial institutions around the world. Former Malaysian Prime Minister Najib Razak was jailed in 2022 after being found guilty of 1MDB-linked corruption and money laundering.
