Deloitte fined in connection with 1MDB corruption scandal
Big Four accountancy firm Deloitte has today been hit with a 2.2m Ringitt (£409,559) fine by Malaysian regulators for failures in its audit of a firm linked to the scandal-hit 1MDB fund.
The Securities Commission Malaysia issued a reprimand and fine for four breaches connected to the 2.4bn Ringitt Sukuk Murabahah Programme, an Islamic bond issued by Bandar Malaysia (BMSB) in 2014.
Deloitte was the statutory auditor for BMSB and 1MDB Real Estate for the 2015 and 2016 financial years. The fund at the centre of the scandal, 1MDB, is the holding company of 1MDB RE and BMSB.
The regulator said Deloitte had failed to report irregularities which may have affected BSMB’s ability to fulfil its obligations in repaying sukukholders.
It said that the breaches were “serious in nature, as it has failed to discharge its statutory obligations”.
The US Department of Justice claims that over $4.5bn (£3.4bn) was stolen by officials working on the 1MDB fund between 2009 and 2014.
The scandal, one of the largest corruption cases in world history, led to the defeat of Prime Minister Najib Razak last year. He has been charged, but has pleaded not guilty.
Meanwhile Goldman Sachs, which helped sell 1MDB bonds, is facing criminal charges in Malaysia.
KPMG has also been reported to be under investigation in connection to the scandal.
Deloitte was contacted for comment.