$4bn likely stolen from 1MDB, says Swiss prosecutor

(From agencies)

Switzerland’s chief prosecutor says about $4 billion may have been stolen from a state fund run by Malaysian Prime Minister Najib Razak who, only days ago, was cleared of wrongdoing in an investigation into transfers of $681 million to his bank accounts.

Michael Lauber

Michael Lauber

The office of Swiss Attorney General Michael Lauber said he has sought Malaysia’s help with his investigation into possible violations of Swiss law by the state-owned fund 1Malaysia Development Berhad (1MDB) set up in 2009.

The possible violations include bribery of foreign officials, misconduct in public office, money laundering and criminal mismanagement at 1MDB.

Malaysia’s Attorney-General Mohamed Apandi Ali said the Swiss findings would be reviewed by Malaysia, along with findings of other relevant authorities and internal investigations, to determine the appropriate course of action.

Last August, Swiss authorities had opened criminal proceedings against two former 1MDB officials as well as “persons unknown” after the state fund  amassed more than $11bn (£7bn) of debt.

Lauber’s investigation revealed that funds to the tune of $4 billion, which should have been earmarked for investment in economic and social development projects in Malaysia, have been misappropriated from Malaysian state companies.

A small portion of the money had been transferred to accounts held in Switzerland by former Malaysian public officials and current and former public officials from the United Arab Emirates.

The prosecutor has sought legal assistance from Malaysian companies involved to find out whether “losses on this scale have been sustained.”

“To date, however, the Malaysian companies concerned have made no comment on the losses they are believed to have incurred,” the attorney general’s statement said.

The statement on Friday said Lauber had discussed the case with his Malaysian counterpart Ali at a meeting in Zurich in September.

Sources said Ali had then strongly urged Lauber to abandon his 1MDB-related investigation involving Najib.

This week, Ali cleared Najib of corruption saying the $681 million transfer was a personal donation by the Saudi royal family to the prime minister’s private bank account.

Malaysia’s anti-graft agency said on Wednesday it will seek a review of a decision by the attorney-general to clear Najib.

Last year, Ali’s predecessor Abdul Gani Patail was investigated and replaced after he linked the donation to Najib’s account with companies and bodies which had ties to 1MDB.

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