Singapore's High Court has ruled to prevent foreign liquidators from pursuing legal action against Standard Chartered and BSI Bank over transactions allegedly linked to Malaysia's sovereign wealth fund 1MDB.

The court stated in its judgment issued last week: "This outcome indeed makes it difficult for applicants to pursue convenient recourse against respondents regarding clearly suspicious transactions."

A Standard Chartered spokesperson said the bank welcomed the court's decision.

According to a July statement, liquidators had initiated legal proceedings in Singapore against the London-based bank. The claimants alleged that Standard Chartered facilitated over 100 internal transfers between 2009 and 2013, thereby helping to disguise the flow of stolen funds. The liquidators claimed these transfers resulted in losses exceeding $2.7 billion for the claimants, plus S$20 million ($15.5 million) in public funds.

The judgment dismissed the case citing several technical legal issues, including the timing of the alleged transactions and questions regarding the applicability of Singapore law.

The 1MDB scandal represents one of the largest financial fraud cases in history, with allegedly stolen funds exceeding $4 billion. Cross-border investigations have resulted in the imprisonment of former Goldman Sachs executives and a former Malaysian prime minister. Malaysian financier Jho Low remains at large.

Singapore authorities had previously fined Standard Chartered S$5.2 million in 2016 for anti-money laundering violations related to the case. Other banks were also penalized.

Additionally, authorities shut down BSI Bank's local business entity in 2016 for violating anti-money laundering regulations, and fined the bank for failing to conduct proper due diligence on high-risk accounts and monitor suspicious customer transactions.

The ruling was previously reported by Singapore's Business Times.