In 2012, with help from Goldman Sachs, a Malaysian sovereign wealth fund called 1Malaysia Development Berhad sold $3.5 billion worth of bonds backed by an Abu Dhabi government fund to help it purchase power plants.
But behind the scenes, American officials have claimed, nearly $1.45 billion was illegally redirected to Swiss bank accounts and ultimately into the hands of some of the people involved in the deal.
That deal is now part of an international investigation into the Malaysian fund, known as 1MDB, that has plagued Najib Razak, the prime minister of Malaysia. A civil complaint filed by Justice Department officials in the United States said that some of the funds landed in the hands of Mr. Najib's friends and associates as well as officials and executives from Abu Dhabi's sovereign wealth fund.
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On Monday, Malaysia and Abu Dhabi moved to clean up one part of the scandal: who would pay back investors who bought the bonds.
The Abu Dhabi fund, the International Petroleum Investment Company, said in a stock exchange announcement in London that Malaysia's finance ministry and 1MDB had agreed to pay $1.2 billion to the Abu Dhabi fund by the end of the year as part of an agreement overseen by an arbitration panel in London.