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Malaysia Charges Ex-PM Najib with Money Laundering

Lex Radz and Hadi Azmi
Kuala Lumpur
2018-08-08
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Former Malaysian Prime Minister Najib Razak arrives at Kuala Lumpur High Court, Aug. 8, 2018.
S. Mahfuz/BenarNews

Malaysian authorities charged former Prime Minister Najib Razak with three counts of money laundering Wednesday, a day after taking control of a $250 million yacht that prosecutors allege was bought by one of his associates using money from a scandal-plagued state investment fund.

The latest charges were linked to three electronic transfers that occurred in 2014 and 2015 in which, according to anti-graft investigators, about 42 million ringgit (U.S. $10.3 million) were diverted into Najib’s personal bank accounts from SRC International, a former subsidiary of the 1Malaysia Development Berhad (1MDB).

Each charge carries a prison sentence of up to 15 years, plus fines, lawyers said. Najib pleaded not guilty.

Anti-graft investigators under the new government of Prime Minister Mahathir Mohamad reopened their 1MDB probe soon after the Pakatan coalition defeated the Barisan Nasional bloc on May 9 in a stunning electoral outcome buoyed by public anger over allegations of corruption at the state investment fund.

The amount involved in the charges filed Wednesday were minuscule compared to allegations earlier made by United States prosecutors that at least $4.5 billion were stolen from 1MDB and diverted through acquisitions of real estate, artwork and luxury properties by Najib and his associates.

Najib was arrested and charged last month with abuse of power and three counts of criminal breach of trust.

The new charges will be consolidated with those four charges, lawyers said. The Malaysian 1MDB probe is independently being pursued in Switzerland, France and the United States.

Najib, who was also the former finance minister, founded 1MDB as a sovereign wealth fund ostensibly to pursue projects beneficial to Malaysians.

When U.S. prosecutors filed a civil forfeiture case related to 1MDB in July 2016, they described a breathtaking level of fraud in which more than $730 million of what seemed to be 1MDB money was rerouted in a complex maze of transactions before ultimately landing to the personal bank account of “Malaysia Official 1,” a veiled reference to Najib.

The U.S. Justice Department (DOJ) has described the 1MDB affair as the “worst kleptocracy scandal in recent times.”

 

‘Surprising display of iron-fisted rule’

As Najib walked to his car, he waved to about 20 supporters who gathered at the court complex lobby.

“This is a surprising display of the iron-fisted rule of Mahathir Mohamad,” said Lokman Noor Adam who organized and led the gathering of Najib’s supporters.

One supporter told BenarNews the accusations against the former leader did not shake his trust in Najib.

“The accusations will keep on coming, but we will never believe that Najib is as bad as what they portray him to be,” Zahalan Man said.

On Monday, Mahathir thanked Indonesian President Joko “Jokowi” Widodo for handing over the Equanimity yacht, which Indonesia initially seized in February. Malaysian investigators boarded the vessel Tuesday after it docked at the Boustead Cruise Center terminal in Pelabuhan Klang.

The Cayman Islands-flagged vessel had been moored off the Indonesian island of Bali since it was boarded by Indonesian police and FBI agents on Feb. 27.

Washington had listed the yacht in court documents as among the assets allegedly bought by Malaysian financier Jho Low, a friend of Najib’s stepson Riza Aziz.

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