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Student activists hold clown-faced caricatures of Malaysian Prime Minister Najib Razak (second right) and his wife Rosmah Mansor (second left) during a protest over the 1MDB scandal in Kuala Lumpur in August 2016. Photo: AFP

Are Malaysia arrests a bid to divert attention from 1MDB scandal?

Move comes soon after controversial appointment of anti-corruption commission’s new chief, seen by some as Prime Minister Najib Razak’s man

Malaysians have been rocked by the arrests of various high-powered government officials and corporate captains in recent weeks, even as Prime Minister Najib Razak battles worldwide graft allegations regarding state fund 1Malaysia Development Berhad (1MDB).

Though the arrests by the Malaysian Anti-Corruption Commission have been praised, critics say the authorities continue to drag their feet on 1MDB. This is despite a US probe claiming that a “Malaysian Official No1” received US$700 million fleeced from 1MDB.

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More importantly, Malaysian corruption watchdogs say the Najib administration continues to refuse to enact structural reforms that would prevent corruption in the first place.

The lack of action on 1MDB and the political will to make government processes transparent and force public officials to declare their assets, have led to criticism that the arrests are a bid to divert attention from 1MDB.

Malaysian Prime Minister Najib Razak. Photo: AFP

Over a period of two weeks, the commission picked up three government officials and two top managers at the national Bank Rakyat. The arrests shocked many as about half of them carried titles, such as “Tan Sri” and “Datuk Seri”, which are awarded by the country’s royal families.

What also raised eyebrows was the fact that the arrests came soon after the contentious appointment of the commission’s new chief, Dzulkifli Ahmad. Opposition politician P Ramasamy speculated that Dzulkifli may have been “Najib’s man” to lead the agency.

The new chief had replaced Abu Kassim Mohamed who had spearheaded the commission’s former probe into 1MDB.

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The Attorney General, who has the final say over whether the commission’s probe should be brought to court, decided there was not enough evidence to prosecute. Najib was subsequently cleared of wrongdoing in 1MDB early this year.

In July, however, the US Department of Justice revealed in a civil suit that up to US$3.5 billion had been stolen from 1MDB. About US$731 million from that was deposited into the personal account of “Malaysian Official No1”.

On September 1, Cabinet Minister Abdul Rahman Dahlan confirmed that “Malaysian Official No1” was Najib but insisted that Najib was not part of the US investigation.

Cabinet Minister Abdul Rahman Dahlan confirmed that “Malaysian Official No1” was Najib. File photo

Anti-graft campaigner Cynthia Gabriel praised the commission’s crackdown on crooked public officials but insisted its new chief must re-open the investigation into 1MDB in light of the US revelations.

“The arrests are very good and a major clean up is long overdue. But the [commission] cannot ignore the elephant in the room which is 1MDB,” Gabriel told This Week in Asia.

“There have been critical developments in the case ever since they closed their investigations early this year,” said Gabriel, a co-founder of the Centre to Combat Corruption and Cronyism.

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The dissonance between the commission’s crackdown and its lack of action over 1MDB was not lost on ordinary Malaysians who vented their frustrations on the popular independent news site Malaysiakini.

“When are you going to check the accounts of [“Malaysian Official No1”]? Are you afraid? People are laughing at you [when you] suddenly arrest people but [“Malaysian Official No1”] you don’t arrest,” wrote a Facebook user named Nik Hariff.

Another Facebook user named P Siva questioned the timing of the arrests.

A student activist holds up a clown-faced caricature of Malaysian Prime Minister Najib Razak during a protest over the 1MDB scandal in Kuala Lumpur on August 27, 2016. Photo: AFP

“I am perplexed as to why the [commission] is suddenly working very hard and arresting all these people with big titles. Is this a tactic to divert attention from 1MDB?”

Another commentator, Mohd Dzulkifli, said the commission’s integrity would remain tarnished as long as it did not take action against individuals named in the US probe, which included Najib’s stepson Riza Aziz and Malaysian businessman Low Taek Jho.

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The arrests again highlighted the need for structural reforms that activists have long campaigned for but which are ignored and even dismissed by members of Najib’s administration. This includes the very basic practice of having politicians and senior civil servants regularly declare their assets to the public – a common practice in Indonesia, Thailand and the Philippines.

In 2012, Najib’s administration had reportedly pledged to study the possibility of enacting public asset declaration rules but nothing has materialised so far.

Student activists march during a protest over a financial scandal involving state fund, 1MDB, in Kuala Lumpur on August 27, 2016. Photo: AFP

One cabinet minister, Tengku Adnan Tengku Mansor, oversees the Kuala Lumpur local council, where the alleged graft took place. Yet he rubbished the suggestion the case made a strong argument for public declaration of assets.

Tengku Adnan said this was unfeasible as it would make politicians who were successful businessman the target of robbers and kidnappers.

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“It reflects badly on Malaysian politicians when they dismiss the idea of publicly declaring their assets,” veteran human rights and anti-graft activist Ambiga Sreenevasan said.

“When they use this excuse it shows that they actually have something to hide,” said Ambiga, who heads human rights body HAKAM.

Cabinet minister Tengku Adnan Tengku Mansor, who oversees the Kuala Lumpur local council. Photo: AFP

Paul Low, the cabinet minister in charge of integrity and anti-graft measures in the Najib administration, declined to comment.

Neither has the Najib administration announced other reforms such as creating an independent public prosecutor’s office or amending secrecy laws so that public works contracts are transparent. Even the Auditor General’s forensic audit of 1MDB is classified as a state secret – something that has baffled politicians and activists.

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These reforms would have prevented the 1MDB scandal in the first place, said the anti-graft campaigner Gabriel. “If we had public declaration of assets then we would not be surprised to find US$700 million in someone’s personal account.”

Despite the crackdowns, there was no political will in the Najib administration to decisively end corruption, said Ambiga. “They don’t want to reform the system because it shields people at the top”.