Malaysia Closes 1MDB Scandal Probe on Najib

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Malaysia Closes 1MDB Scandal Probe on Najib

The attorney general finds no evidence of corruption, but critics say questions still remain.

Malaysia’s attorney general said Tuesday that he had closed a probe into allegations that the country’s premier, Najib Razak, had mismanaged funds linked to debt-ridden state investment fund 1Malaysia Development Berhad (1MDB), the latest development in a high-profile corruption scandal that has consumed the Southeast Asian state.

The so-called 1MDB scandal had rocked Malaysia following a July 3 report by the Wall Street Journal, which alleged that nearly $700 million from entities linked to 1MDB was deposited into Najib’s private bank account. Though Najib has denied using government funds for personal gain and the country’s anti-corruption agency has found no evidence thus far directly implicating him, revelations – including the fact that the money had come from an unspecified Middle East donor prior to Malaysia’s 2013 general elections – had only raised more questions and threatened his grip on power.

But on January 26, Attorney General Mohamed Apandi Ali said at a news conference that the $681 million transferred into the Malaysian prime minister’s personal bank account was a gift from the Saudi royal family, and that there was no criminal offense or corruption involved.

“I am satisfied with the findings that the funds were not a form of graft or bribery,” the attorney general said. He also added that Najib had returned $620 million to the Saudi royal family as the funds had not been utilized.

This statement echoes what the Malaysian anti-corruption commission (MACC) earlier said in August 2015 at the height of the scandal about the funds in Najib’s account being a political donation from an unidentified Middle Eastern benefactor rather than 1MDB.

Commenting further, the attorney general said that no reason was provided as to why the donation was made to Najib, adding that that was “between him and the Saudi family.”

The attorney general announced that he would return the MACC papers pertaining to the three separate investigations with instructions to close all three cases. This presumably ends months of speculation about the fate of the embattled Najib, who has weathered calls from opposition leaders and establishment figures, such as former prime minister Mahathir Mohammad, to resign.

Despite this development, skeptics and critics have fixated on the questions that still remain unanswered, including why exactly Saudi Arabia would send Najib such a large sum of money or how the portion of the money that was not returned – $61 million – was spent. On January 27, BBC reported that the funds were personally authorized by Saudi Arabia’s late King Abdullah to help Najib win the Malaysian general elections in 2013, at a time when the Saudis were worried about the global influence of the Muslim Brotherhood. The funds apparently came from King Abdullah’s personal wealth as well as state funds.

Najib said in a statement to The Guardian that he welcomed the attorney general’s comments that “confirmed what I have maintained all along: no crime was committed.” He added that the issue had been an “unnecessary distraction for the country” and “now that the matter has been comprehensively put to rest, it was time for us to reunite and move on.”

Najib continues to enjoy the backing of the powerful division chiefs within Malaysia’s ruling party, the United Malays National Organization (UMNO). Amid a cabinet reshuffle in late July 2015, Najib replaced previous attorney general Abdul Gani Patail, who had led investigations into 1MDB, citing health reasons for the change ahead of Patail’s retirement in October 2015. Critics had slammed the move as an attempt to undermine an ongoing probe.

Lim Kit Siang, the parliamentary leader of the opposition Democratic Action Party, said that it was inappropriate for Apandi to make such a decision given that he was appointed by Najib himself following Patail’s sacking.

“It was very controversial circumstances when Gani Patail was sacked. It is a conflict of interest,” he said.