Edmond de Rothschild Europe Agrees to €25 Million Settlement Over 1MDB Scandal

Private banking group Edmond de Rothschild Europe has reached a €25 million agreement to settle criminal allegations stemming from its involvement in the 1MDB corruption scandal. The settlement, struck with prosecutors in Luxembourg last week, is still subject to judicial approval.

A spokesperson for the Luxembourg prosecutor’s office confirmed the agreement to the Luxembourg Times, stating: “The matter was taken under advisement, and a judgment will be rendered on 22 May 2025.” The case is now in the hands of the 7th Criminal Chamber of Luxembourg’s District Court, which will issue its decision on that date.

The controversy traces back to between 2009 and 2013, when at least $4.5 billion—approximately €3.3 billion at the time—was allegedly siphoned from Malaysia’s sovereign wealth fund 1MDB, according to international investigators. Of that, about $472.5 million, or €433.7 million, was eventually transferred to Edmond de Rothschild Europe, a Luxembourg-based private bank.

Prosecutors accused the bank of failing to carry out sufficient checks on the origin of those funds. An investigative magistrate concluded the inquiry in May 2023, characterizing it as a “particularly complex case.”

Now, the bank has entered into a jugement sur accord—a form of criminal settlement under Luxembourg law—admitting to offences including money laundering and concealment. According to a representative of the prosecutor’s office, the bank has “acknowledged” its involvement in the misconduct.

While this settlement addresses the bank’s criminal liability, prosecutors continue to pursue legal action against four individuals linked to the affair. The bank has declined to comment publicly, citing ongoing legal proceedings connected to the case.

This isn’t the first time the bank has faced scrutiny over 1MDB. Back in 2017, Luxembourg’s financial watchdog, the Commission de Surveillance du Secteur Financier (CSSF), imposed a fine of nearly €9 million on Edmond de Rothschild Europe for procedural shortcomings in connection with the scandal.

The 1MDB scandal has prompted investigations and prosecutions across multiple countries as authorities work to reclaim misappropriated public funds.

By fLEXI tEAM