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Malaysian Prime Minister Najib Razak today denied news reports that nearly US$700 million were funnelled from an indebted state investment fund into his personal accounts.
The investment fund 1Malaysia Development Bhd (1MDB), which has accumulated 42 billion ringgit (HK$86 billion) in debt, is currently under investigation for alleged impropriety. The Wall Street Journal and the Sarawak Report online news portal reported that investigators have traced some US$700 million wired into Najib’s bank accounts.
However, Razak dismissed the claims “political sabotage”.
Najib’s office said in a statement that the claims were an effort to “undermine confidence in our economy, tarnish the government, and remove a democratically elected prime minister”.
“These latest claims, attributed to unnamed investigators as a basis to attack the prime minister, are a continuation of this political sabotage,” it added.
The newspaper cited documents it said it had obtained, including bank transfer forms and flow charts prepared by government investigators as the basis for its report.
On the allegations themselves, the statement said only that “it must be noted that 1MDB has already stated that the company never provided funds to the prime minister”.
Najib has come under increasing pressure over his leadership. Former premier Mahathir Mohamad has led calls for him to step down, warning that there was “something rotten” in the country and that the ruling coalition may lose the next elections with Najib at the helm.
The reports said five deposits were made into Najib’s account and the two largest transactions, worth US$620 million and US$61 million, were done in March 2013 ahead of general elections.

Mahathir also echoed critics’ concerns about 1MDB’s massive debt, an alleged lack of transparency and why billions of ringgits were kept in the Cayman Islands. Mahathir stepped down in 2003, after 22 years in power, but remains an influential political figure.
1MDB was launched in 2009 by Najib, who still chairs its advisory board. Critics say it has been opaque in explaining its dealings.
It is reeling under heavy debt, which has weighed on the ringgit amid allegations of mismanagement and murky overseas transactions. Under pressure, Najib earlier this year ordered his auditor-general to examine 1MDB’s books. Its report has not yet been released.
The 1MDB, however, denied any wrongdoing, saying it had never provided any funds to Najib.
“To suggest otherwise, as some media outlets have done, is highly irresponsible and a deliberate attempt to undermine the company,” it said.
Both Najib and 1MDB said that previous leaked documents had “reportedly” been tampered with, and that the documents cited by the WSJ had not been verified.
The Journal said that the millions moved through government agencies, banks and companies linked to the fund before ending up in Najib’s accounts.
1MDB’s huge debt has raised fears a possible bailout could leave the government bankrupt.
Malaysia’s ringgit currency tumbled today to 3.7845 against the US dollar, its lowest level since July 2005, after the report’s publication.
The fund urged the public to wait for the outcome of the investigations by government agencies, including the auditor general and the central bank.


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Malaysia 1MDB scandal

Malaysian PM Razak denies reports troubled state fund sent US$700m to his personal bank accounts

Malaysia's Prime Minister Najib Razak called allegations of questionable fund transfers to his accounts as 'political sabotage'. Photo: Reuters

Workmen are pictured on site at the 1 Malaysia Development Berhad (1MDB) flagship Tun Razak Exchange development in Kuala Lumpur. 1MDB has been strapped with billions of US dollars in debt. Photo: Reuters

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