JPMorgan’s 1MDB Reckoning: Swiss Conviction and $330M Settlement

It has been reported that

• JPMorgan Chase has been criminally convicted in Switzerland and agreed to a substantial settlement with the Malaysian government over its role in the 1MDB scandal.
• https://www.news.admin.ch/en/newnsb/iBaPoJlflbgYucklcjfxd

At the conclusion of criminal proceedings initiated in November 2022, the Office of the Attorney General of Switzerland (OAG) issued a summary penalty order and partial abandonment of the proceedings.

The OAG sentenced J.P. Morgan (Suisse) SA (JP Morgan Suisse) to a fine of CHF 3 million for failing to take all reasonable and necessary organisational measures to prevent acts of aggravated money laundering.

• The fund transfers took place between October 2014 and July 2015.
• The outbound transactions totalled approximately CHF 174 million.

This conviction is part of a series of proceedings conducted by the OAG relating to the embezzlement of assets from the Malaysian sovereign wealth fund 1Malaysia Development Berhad (1MDB).

The private claimant in the case, 1MDB, stated that it will be compensated in the amount of MYR 1.4 billion.

This criminal conviction stems from one of several cases connected with the embezzlement of assets belonging to the Malaysian sovereign wealth fund 1MDB.

Here's a breakdown of the key developments:

Swiss Conviction of JPMorgan Suisse

• Date of Conviction: August 22, 2025
• Authority: Office of the Attorney General of Switzerland (OAG)
• Penalty: CHF 3 million (approx. \$3.7 million)
• Reason: JPMorgan Suisse failed to implement adequate organisational measures to prevent aggravated money laundering.
• Period of Offence: October 2014 – July 2015
• Transactions Involved: 43 fund transfers totalling CHF 174 million, linked to PetroSaudi and the embezzlement of 1MDB funds.

The OAG concluded that JPMorgan Suisse ignored public red flags about PetroSaudi and its executives, who had already been convicted of embezzling over \$1.8 billion from 1MDB. The bank's internal failures enabled the laundering of these funds.

Settlement with Malaysia

• Settlement Amount: \$330 million (MYR 1.4 billion)
• Recipient: Malaysia’s Assets Recovery Trust Account
• Nature of Settlement: Civil claims resolved without admission of liability
• Background: Malaysia had sued JPMorgan’s Swiss unit in 2021, seeking \$800 million for alleged negligence and dishonest assistance in facilitating fraudulent transfers.

Both JPMorgan and Malaysia agreed to withdraw all pending appeals, and the bank stated it has since enhanced its compliance controls.

Broader Context

• The 1MDB scandal is one of the largest global financial frauds, involving over \$4.5 billion in misappropriated funds.
• Other institutions like Goldman Sachs have paid over \$5 billion in penalties globally.
• Malaysia has recovered over \$7 billion in assets linked to 1MDB and its former subsidiary SRC International.

Long read

1MDB case: Bank JP Morgan Suisse convicted by summary penalty order

1. At the conclusion of criminal proceedings initiated in November 2022, the Office of the Attorney General of Switzerland (OAG) issued a summary penalty order and partial abandonment of the proceedings.
2. The OAG sentenced J.P. Morgan (Suisse) SA (JP Morgan Suisse) to a fine of CHF 3 million for failing to take all reasonable and necessary organisational measures to prevent acts of aggravated money laundering.
1. The fund transfers took place between October 2014 and July 2015.
2. The outbound transactions totalled approximately CHF 174 million.
3. This conviction is part of a series of proceedings conducted by the OAG relating to the embezzlement of assets from the Malaysian sovereign wealth fund 1Malaysia Development Berhad (1MDB).
4. The private claimant in the case, 1MDB, stated that it will be compensated in the amount of MYR 1.4 billion.
5. For this reason, the OAG has not ordered a compensatory claim.
6. This criminal conviction stems from one of several cases connected with the embezzlement of assets belonging to the Malaysian sovereign wealth fund 1MDB.

Two managers of Petrosaudi were guilty of embezzling over USD 1.8 billion from 1MDB on 28 August 2024

7. As a reminder, in the same case complex, the Criminal Chamber of the Federal Criminal Court found two managers of Petrosaudi guilty of embezzling over USD 1.8 billion from 1MDB on 28 August 2024 (see FCC press release).
1. https://www.bstger.ch/uploads/2024-08-27_Press_Release_SK.2023.24.pdf
8. The two accused individuals were found guilty of fraud, complicity in criminal mismanagement and qualified money laundering.
9. The Federal Criminal Court found them criminally liable for the implementation of a fraudulent scheme that led to the transfer of USD 1 billion from 1MDB on the false pretext of a joint venture between Petrosaudi and 1MDB.
10. Subsequently, the accused individuals lent assistance, in connection with acts of criminal mismanagement, in the misappropriation of two additional instalments of USD 500 million and USD 330 million, claiming falsely that these funds were intended for legitimate investment opportunities, before laundering the embezzled funds in their entirety.
11. The presumption of innocence prevails pending a final and legally binding judgment. JP Morgan Suisse is not a party to these proceedings.

In November 2022, the OAG initiated criminal proceedings against the bank JP Morgan Suisse.

12. In this context, in November 2022 the OAG initiated criminal proceedings against the bank JP Morgan Suisse and persons unknown for corporate liability in connection with aggravated money laundering (Art. 102 no. 2 Criminal Code in conjunction with Art. 305bis no. 1 and 2 Criminal Code) or aggravated money laundering itself (Art. 305bis no. 1 and 2 Criminal Code), for the period from 2009 to 2015.
13. In its order dated 22 August 2025, the OAG found JP Morgan Suisse guilty of violating Art. 102 para. 2 SCC in relation to the offense of aggravated money laundering (Art. 305bis sections 1 and 2 SCC), for the period from 7 October 2014 to 21 July 2015, and sentenced the bank to a fine of CHF 3 million.
14. This amount takes into account the time elapsed since the offence was committed, as well as JP Morgan Suisse’s excellent cooperation in the proceedings and the compensation of the private claimant.
15. Proceedings relating to the facts pre-dating 2 October 2014 are abandoned under the terms of Art. 319 para. 1 lit. Sections b and d of the Criminal Procedure Code.

Criminal origin of funds

1. During the period under investigation, JP Morgan Suisse opened several business relationships connected with Petrosaudi and its two managers.
2. The funds that financed these business relationships can be traced back to the offences of fraud and complicity in criminal mismanagement committed against 1MDB (judgment SK.2023.24 of 28 August 2024).
3. In the present case, JP Morgan Suisse received or executed 43 transfers of funds originating from those earlier offences between 15 October 2014 and 21 July 2015, including 34 transfers abroad for a total of approximately CHF 174 million.

Corporate liability

1. The investigation established that from 2 October 2014 onwards, despite derogatory information from various public sources concerning the potential involvement of the two managers and of the Petrosaudi group in the embezzlement scheme defrauding 1MDB, JP Morgan Suisse did not adequately clarify the nature of the business relationships and lacked reasonable and critical judgment.
2. The transactions carried out between 7 October 2014 and 21 July 2015 were made possible due to an organisational failure at JP Morgan Suisse, which did not prevent the commission of money laundering offences.

Private claimant compensation

1. Since 1MDB, as the private claimant, is compensated in the amount of MYR 1.4 billion, the OAG does not order a compensatory claim.
2. The parties have declared that they will not appeal the order, which, as a result, enters into force. The order may be consulted or obtained in an anonymised form under the standard conditions via the OAG’s Legal Services

References

• 1MDB case: bank JP Morgan Suisse convicted by summary penalty order https://www.news.admin.ch/en/newnsb/iBaPoJlflbgYucklcjfxd
• JPMorgan to Pay $330 Million in 1MDB Settlement as Swiss Unit Convicted ...https://www.grcreport.com/post/jpmorgan-to-pay-330-million-in-1mdb-settlement-as-swiss-unit-convicted-in-money-laundering-case
• JPMorgan to pay $330M to settle 1MDB claims | Banking Dive https://www.bankingdive.com/news/jpmorgan-chase-330-million-1mdb-malaysia-swiss-money-laundering-goldman-deutsche/758422/
• https://www.news.admin.ch/en/newnsb/iBaPoJlflbgYucklcjfxd