The over $4.5 billion theft from Malaysian sovereign wealth fund 1MDB is one of the world’s biggest-ever financial scams and a sad story as it deprived ordinary people in that country of vital resources. Xavier Justo talks about his nightmare experience exposing the fraudsters responsible for this massive theft and the lessons he’s learned along the way.

When Xavier Justo sat down to talk with Fraud Magazine over Zoom about his experiences as a whistleblower, he’d just returned from Malaysia where he was promoting his book. Justo is lauded in the Southeast Asian country for his role in bringing down the corrupt government of former prime minister Najib Razak, who now sits in prison on graft charges. But Justo and his family have paid a high price for his valor.

It’s been eight years since Justo says he was unjustly thrown in a Thai prison for blackmail, and he’s still suffering the consequences of his role in exposing Razak and Justo’s former colleagues at oil services firm PetroSaudi who plundered the Malaysian sovereign wealth fund 1Malaysia Development Bhd (1MDB) for billions of dollars. Indeed, it’s been a long and often frustrating journey for the former Swiss banker.

Justo says he still faces charges in Switzerland for industrial espionage brought against him by Patrick Mahony and Tarek Obaid, the two former managers at PetroSaudi, who were responsible for his 547-day nightmare in a crowded cell in Thailand’s notorious Klong Prem Central prison. The PetroSaudi managers have accused Justo of stealing company data that exposed the dirty dealings at 1MDB, but Justo says an IT engineer freely gave him the information. And the case has ignited a debate about how whistleblowers expose wrongdoing and how best to protect them. (See “1MDB whistleblower under investigation in Switzerland,”, Foreign Affairs, Feb. 14, 2019.)

Under those circumstances, Justo feels he’s been unfairly treated by Swiss authorities, who’ve dropped a string of criminal complaints that he and his wife, Laura, brought in October 2017 against Mahony and Obaid. Justo says that not only did the two PetroSaudi managers bribe Thai officials, but they also intimidated and manipulated his wife to keep him falsely imprisoned and quiet about the managers’ dirty dealings with 1MDB. Alternating between threats to stop her from seeing Justo in prison and promises that they’d help her free him soon, Mahony and Obaid pushed Laura to cooperate with them in a disinformation campaign to discredit Clare Rewcastle Brown, the journalist to whom Justo had leaked information about wrongdoing at PetroSaudi. The offenses in Justo and his wife’s complaint include threatening behavior, extortion and blackmail, coercion, imprisonment and abduction, misleading judicial authorities, bribery of foreign public officials and money laundering. According to the Swiss attorney general’s office, which already indicted the two managers on the money-laundering charges, the complaint has bumped up against a statute of limitations and “did not give rise to a reasonable suspicion.” (See “1MDB affair: two PETROSAUDI managers indicted in the Federal Criminal Court,” Swiss government, April 25, 2023.)

Justo says he’s appealing that decision and wants to reinstate his charges against Mahony and Obaid. “I am not looking for revenge,” says Justo. “But my wife has been manipulated and mentally tortured [by Mahony and Obaid]. My son was without his father for 18 months of his life. That is not fair or right. They should at least investigate the charges.”

Nor, he says, should courts have given Mahony and Obaid access to an escrow account from an earlier oil exploration project between PetroSaudi and the Venezuelan state-owned oil company PDVSA. Both have extracted millions of dollars from that account to help them pay for legal costs and maintain their rich lifestyles, according to the Sarawak Report. [See “Clean Money? PetroSaudi’s Lies Are Unmasked (Again),” Sarawak Report, Sept. 23, 2022.]

In contrast, Justo says his month-to-month life is now a struggle to cover bills as finding permanent work has proven impossible, partly due to the industrial espionage charges in Switzerland and because of Mahony and Obaid’s efforts to discredit Justo through various disinformation campaigns via social media. (See “Billionaires, whistleblowers, criminals, political opponents: The targets of the disinformation factory,” by Damien Leloup and Florian Reynaud, Le Monde, Feb. 16, 2023.)

“Being seen as the whistleblower, as the good guy, as the hero, as the guy who went to prison and all these things, doesn’t help you to find a job,” Justo tells Fraud Magazine. “I can find a couple of consultancy jobs, but financially it is a nightmare. I know I can pay the rent at the end of this month, but I have to find the money for the next month, and I don’t have a fixed job.”

Indeed, Justo has often found himself at the end of many a job interview to be told that everyone likes him, but because of his past, he presents too much of a reputational risk to the firm. Justo’s association with the 1MDB scandal essentially forced him to leave his country of birth, Switzerland, where he found it impossible not only to find gainful employment but a place to live. He recalls how one particular landlord said that her husband feared there would be car bombs in their parking lot if they rented to Justo’s family. And then there was the time at the airport when he tried to exchange his currency through the Travelex machine, and the World-Check Risk Intelligence software flashed red on his name. (See “Refinitiv World-Check Risk Intelligence,” Refinitiv.) “The computer went red because I am on all the databases,” says Justo. “My name is red like a tomato.”

Finding justice

Much has been written about the 1MDB scandal: how fraudsters stole more than $4.5 billion from a sovereign wealth fund meant to help the Malaysian people, how that money financed the lavish lifestyles of Razak and other middlemen and how the alleged mastermind behind the scam — Malaysian businessman Jho Low — used his haul to establish himself in Hollywood and fund the film “The Wolf of Wall Street,” only to escape to China. (See “1MDB scandal explained: a tale of Malaysia’s missing billions,” by Hannah Ellis-Petersen, The Guardian, July 28, 2020 and “How Malaysia’s 1MDB Scandal Shook the Financial World,” by Shamim Adam and Yudith Ho, Bloomberg/The Washington Post, March 10, 2023.) But less has been said about Justo’s traumatic experiences as a whistleblower. Justo and his wife, Laura, are now telling their story in a self-published book, “Rendezvous with Injustice,” which describes their ordeal from both their perspectives.

“It is a kind of legacy for our son, family and friends,” says Justo. “We wanted them to know the real story, not through other people. This happened to us because of 1MDB and PetroSaudi, but there are no new revelations about 1MDB [in the book]. There may be, however, revelations about how the justice system works and how criminals are protected, and innocent people are not.”

While a few of those involved in what has been described as one of the world’s biggest-ever financial scams are behind bars and the banks connected to the scandal have agreed to pay billions of dollars in fines, Justo laments how criminals with deep pockets can still have influence across borders and manipulate the justice system to their favor.

But the wheels of justice have started to turn, albeit slowly, in Justo’s favor after a long wait. Using much of the evidence that Justo handed over to the authorities, in April Switzerland’s attorney general indicted two PetroSaudi managers, widely believed to be Mahony and Obaid, for alleged fraud, aggravated criminal mismanagement and aggravated money laundering in connection with the misappropriation of at least $1.8 billion from 1MDB between 2009 and 2015. (See “1MDB affair: two PETROSAUDI managers indicted in the Federal Criminal Court,” Swiss government, April 25, 2023; “FINALLY - Swiss Prosecutors Indict The PetroSaudi Boys!” The Sarawak Report, April 25, 2023; and “Switzerland indicts ex-PetroSaudi executives over 1MDB fraud,” by Sam Jones, Financial Times, April 25, 2023.)

“They will face a court and a trial within the end of the year, or early next year,” says Justo. “It will probably be quick because all the evidence is there.”

Sentinel Award recipient’s story

This year, the ACFE presented Justo with its Sentinel Award, which the association bestows annually on a person who, without regard to the consequences, has publicly disclosed wrongdoing in business or government. He spoke at the 34th Annual ACFE Global Fraud Conference and to Fraud Magazine about the difficulties faced by whistleblowers who have the courage to speak up and the frustrations of battling fraudsters with deep pockets.

Today Justo and his family live in a small flat in Spain, where the 1MDB scandal and Justo himself are less well known. The life of the former Swiss banker now stands in stark contrast to the comforts he enjoyed before it all imploded in the summer of 2015. Justo’s story is as bizarre as the 1MDB scandal is big. Here’s what happened, according to Justo himself, his book and press reports. (See “1MDB: The inside story of the world’s biggest financial scandal,” by Randeep Ramesh, The Guardian, July 28, 2016.)

In 2015, Justo was living a dream life on Koh Samui, a small island off the coast of Thailand known for its stunning beaches. All seemed well in the world for Justo, who along with his wife, Laura, and baby boy, Xander, were building their own resort and planning to settle in this tropical paradise following his departure from PetroSaudi, where he’d worked as a director.

On June 22, Justo had just finished a morning training session for the Ironman Triathlon, which he planned to compete in that November in Australia, and he was looking forward to flying to Switzerland in a fortnight to see his son and wife who were visiting family. While waiting for the arrival of a Thai immigration officer to renew his work permit, Justo noticed a group of cars and people standing outside his house. Unperturbed, he thought Thai immigration might be tightening controls under the recently installed military government. All the men were dressed in civilian clothes. Justo walked out the door to introduce himself, but to Justo’s surprise, one of the men handcuffed him so tightly that he began to bleed. He soon learned they were from the Crime Suppression Division of the Royal Thai Police.

The police turned off the security cameras, and for the next two hours ransacked Justo’s house and confiscated computers, laptops and mobile phones. He was transferred to a nearby police station and then flown to a Bangkok prison, where he was thrown into a cramped cell. The charges? Attempted blackmail of his former employer PetroSaudi.

Blowing the whistle

Rewind to May 2014 when Justo was first contacted by Clare Rewcastle Brown, an investigative journalist and ACFE’s 2018 Guardian Award winner. (See “Lone brave journalist exposes 1MDB corruption,” by Sarah Hofmann, CFE, Fraud Magazine, May/June 2018.) She’d heard about Justo’s involvement with PetroSaudi, which had a joint venture with 1MDB, and wanted to speak to him.

“She said she was a journalist who writes about corruption in Malaysia,” remembers Justo. “‘You may have information that might help my cause,’ she said, and I told her if you come to Thailand, I would be pleased to meet you. Two weeks later she came to visit me in Bangkok. That was our first meeting, and that changed our lives forever.”

When Justo met Rewcastle Brown, it had been about three years since he’d left PetroSaudi. He’d enjoyed the job, but he no longer wished to be part of the office’s party lifestyle and the increasingly “degenerate” behavior of Mahony and Obaid, whose spending habits had gotten out of hand after the announcement of the joint venture with 1MDB. “Patrick and Tarek became crazy,” recalls Justo. “They had so much money. It was a daily party at the office and everywhere. I mean I have nothing against that, but I just didn’t want to be involved.”

Nor had Justo departed on the best of terms as his friendship with Obaid soured after they fought over his decision to leave the company and what was fair severance pay. Besides, there was something off about the astronomical amounts of money being spent at a small company with a few employees. Following the joint venture with 1MDB, both Mahony and Obaid had bought multimillion-pound properties in London, and rented a large office in Mayfair, one of the city’s most exclusive neighborhoods. “We could have probably fit 100 people in the office, but we were only five or six,” recalls Justo. “Every time we went to a restaurant the meal was at least 500 pounds per person, the most expensive bottles of wine. And we made a few flights to Venezuela on a private jet.”

The joint venture between PetroSaudi and 1MDB (which according to the press release involved an initial $1 billion investment from the sovereign wealth fund) had been fishy from the start, and Justo had his suspicions. (See sidebar below at the end of the article.) But big money from commissions was part of the oil business and wasn’t necessarily out of the ordinary. Besides, Justo had no proof of any wrongdoing. Mahony and Obaid had told him that the only available cash from the 1MDB joint venture was approximately $300 million, which they’d deposited in a J.P. Morgan account and was being used for working capital. “We didn’t have any bank statements, paper, nothing,” says Justo. “I don’t want to say I was happy, but I was convinced the deal was only $300 million.”

Even so, as a safety measure, on leaving the company Justo contacted PetroSaudi’s IT person, whom he’d worked with at a previous job, and asked if he could provide him with some of the firm’s data. To his surprise, he handed over a complete hard drive comprising some 90-plus gigabytes of information and 220,000 emails. “It was a form of insurance in case there was a problem or a scam,” says Justo. “I just wanted to prove to the authorities that I had nothing to do with it.”

At the time, Justo didn’t realize the trove of evidence he had in his possession. Preoccupied with starting a new life in Thailand, Justo put all things related to PetroSaudi on the back burner. On weekends, he’d occasionally look at some of the data the PetroSaudi IT person had given him, but because of its size it took hours to download.

“We are talking about millions of pages of documents with a lot of useless material,” he says. “So, from time to time I thought, ‘wow that is strange or that is a big number’ and so on, but at that time I was getting married, my wife was pregnant, so it wasn’t a priority.”

It was some of these files that three years later Justo first showed to Rewcastle Brown, who had her own suspicions about 1MDB but lacked evidence. She said she’d be in touch and contacted Justo again in February 2015. By this time, Justo was a father. His son was born in October the previous year. He met Rewcastle Brown and the chairman and CEO of the Edge Media Group, a Malaysian publishing house, in Singapore. They knew Jho Low was siphoning 1MDB funds out of Malaysia, but they were struggling to prove it.

“So, with their knowledge and my file we spent the day together and could match in a few hours different parts of the puzzle,” explains Justo. Using the documents Justo had given her, Rewcastle Brown published her first big expose on the 1MDB scandal on Feb. 28, 2015, and the Thai police arrested Justo four months later. (See “HEIST OF THE CENTURY - How Jho Low Used PetroSaudi As ‘A Front’ To Siphon Billions Out Of 1MDB!” Sawarak Report.)

Prison time

Mahony and Obaid had manufactured charges of attempted blackmail against Justo as they sought to keep him quiet and make him look like the guilty party. Among the cast of characters that Justo describes in his book is Paul Finnigan, who, Justo said, falsely claimed to be a Scotland Yard detective and remained in constant contact with Justo and his wife at the request of PetroSaudi. (Finnigan, a British citizen, was later discovered to be a former U.K. policeman, according to Justo.) His job, Finnigan told Justo, was to get him to sign the confession (for his own good) and help him follow instructions. If he pleaded guilty, he’d soon be out of prison. (See “Thailand’s Police Chief And PetroSaudi Must Now Explain What Happened To The ‘Scotland Yard Detectives’,” Sarawak Report, Nov. 6, 2016.)

At first, Justo insisted on his innocence, but as time went by his fears of being stuck in the hell that was the Thai prison, and the aching need to be with his family, got the better of him. Justo says he had no choice but to falsely confess that he’d stolen the PetroSaudi data, had collaborated with Malaysia’s political opposition and denounced Rewcastle Brown. Finnigan told him the choice was to confess to these lies or spend 10 years in jail. Even then, to Justo’s dismay, he was sentenced to three years at his trial on Aug. 17, 2015.

“They bribed the police, they bribed the judge, everybody,” says Justo. “My trial was a four-minute trial. We didn’t even go to the courtroom. Somebody came with a piece of paper and said, ‘OK: a six-year sentence, divided by two because you pleaded guilty.’”

Mahony and Obaid did all they could to keep up the farce that they were helping Justo and persuading his wife Laura to be a “team player,” while also leveraging Justo’s confession to conduct a misinformation campaign through their lawyers and PR agents. But Laura, tired of their broken promises, fought to free her husband and rebelled against his captors. She gathered an abundance of evidence and recorded conversations with Mahony that later showed law enforcement and the press of his true intentions. (See “Patrick Mahony calls Xavier Justo’s wife, Laura — audio,” by Tom Silverstone, The Guardian, Malaysia, July 28, 2016.)

On Oct. 13, 2016, news of the Thai king’s death brought hope among the prisoners, including Justo, amid expectations that the new king would grant a string of amnesties. In early December, Justo heard his name through the loudspeakers announcing those who’d be set free. On December 20, he was released and the following day he was reunited with his family after flying back to Switzerland. His prison nightmare was over.

Lessons learned

Often, says Justo, people think that complex and big frauds, such as 1MDB, are hard to detect, but PetroSaudi’s involvement in the scandal would’ve been easy enough to catch. When the joint venture with the sovereign wealth fund became public, the size and past business failures of PetroSaudi should’ve raised red flags. “There was no way they could have done this kind of major deal,” Justo told an audience of CFEs at the ACFE Annual Global Fraud Conference in Seattle this summer. “Tarek was also having financial difficulties, and it is very easy in Switzerland to find out if people are wealthy or not.”

Furthermore, for anyone who bothered to investigate, it was clear that the joint venture between PetroSaudi and 1MDB was fake. The Turkmenistan oil fields that PetroSaudi offered in return for the sovereign wealth fund’s investments were invalid assets as they sat in disputed territory. (See sidebar below at the end of the article.) “It would have been very easy to Google and find out there was a territorial dispute between Turkmenistan and Azerbaijan,” he added.

As for his own mistakes in this saga, Justo says that he was overconfident in his ability to remain safe in Thailand. And he says he underestimated the ability of Mahony and Obaid to use their wealth to bribe officials and hire top lawyers to defend themselves and attack him in jurisdictions across the globe. “I always thought I was quite smart, but sometimes you are not that smart. I was overconfident. I forgot that when you steal billions, there is no border.”

Paul Kilby, CFE, is editor-in-chief of Fraud Magazine. Contact him at

[See sidebar: “The PetroSaudi scam: How fraudsters stole close to $2 billion from 1MDB”.]

*Image source: Jose Jordan