DBS faces $1 billion lawsuit in Singapore High Court linked to Jho Low associate

Southeast Asia’s biggest bank just got slapped with a billion-dollar lawsuit tied to one of the largest financial frauds in history. DBS Group Holdings is facing a claim of S$1.298 billion, roughly US$1.03 billion, filed in Singapore’s High Court by liquidators of four companies linked to the sprawling 1MDB scandal.

The companies at the center of the case, Blackrock Commodities (Global) Ltd., Affinity Equity International Partners Ltd., Platinum Global Luxury Services Ltd., and TKIL Global Investments Ltd., all held accounts at DBS under the signature of Malaysian national Eric Tan. Tan is a known close associate of fugitive financier Jho Low, the man widely regarded as the architect of the 1MDB theft.

What the lawsuit alleges

The claim was filed by liquidators Jason Aleksander Kardachi and Karnjote Singh, who are tasked with recovering assets from the four companies. According to the 1MDB Asset Recovery Taskforce, more than US$1 billion in funds misappropriated from Malaysia’s state fund 1MDB and the related entity SRC International flowed through these companies during 2013 and 2014.

Five DBS accounts were opened in 2013, with Eric Tan listed as the sole beneficial owner and signatory on all of them. The transfers allegedly had no legitimate commercial purpose and were eventually routed to various third parties.

DBS has firmly rejected the allegations. In a filing dated around September 9-10, the bank said it intends to defend vigorously against the claims and has not set aside any provisions for potential losses.

The 1MDB saga, still unfolding

Malaysia’s state investment fund, 1Malaysia Development Berhad, was created in 2009 to promote economic development. Instead, according to US authorities, approximately US$4.5 billion was siphoned out of it.

Jho Low, the Malaysian financier at the center of it all, has been charged in both Malaysia and the US but remains a fugitive. His associate Eric Tan, who controlled the DBS accounts in question, has been identified in various recovery proceedings as a proxy, facing previous default judgments against him.

Singapore itself has been a key jurisdiction in the 1MDB fallout. The city-state shut down two banks, BSI Bank and Falcon Private Bank, for their roles in the scandal. Multiple bankers were criminally prosecuted. The Monetary Authority of Singapore imposed financial penalties on several other institutions, including DBS, for anti-money laundering control failures related to 1MDB-linked transactions.

What this means for DBS and the broader cleanup

Malaysia itself reached settlements with Goldman Sachs, which agreed to pay US$3.9 billion over its role in raising funds for 1MDB through bond offerings. Recovery actions have also targeted assets in the US, Switzerland, Luxembourg, and elsewhere.