13 Feb 2016
Swiss authorities have declared that there are “serious indications” that $4bn of government money has gone astray in Malaysia connected with the scandal surrounding Prime Minister Najib Razak and the 1Malaysia Development Berhad (1MDB) state investment fund.
According to the Swiss attorney-general’s office, some of the funds were placed in bank accounts of former Malaysian officials and former and current officials from the UAE.
The scandal started in early 2015 when the Malaysian state investment fund, chaired by Prime Minister Najib, was found to be defaulting on payments. At the same time, Najib admitted receiving $680m in his personal bank account, insisting the transfers were a gift from the Saudi royal family.
According to the Wall Street Journal, the money flowed to Mr Najib’s accounts via an anonymous company in the British Virgin Islands and a Swiss private bank owned by an Abu Dhabi sovereign wealth fund.
So far, the scandal has triggered investigations in Switzerland, Singapore, the US and Hong Kong. Singapore police have frozen two accounts as part of an investigation linked to 1MDB, and Hong Kong police said they were investigating bank deposits allegedly linked to Najib.
The Swiss authorities have launched a criminal investigation into alleged fraud committed in Switzerland in connection with 1MDB. According to The Wall Street Journal, the FBI has also launched an investigation.
Count reading this article to your CPD minutes, by signing up to our CPD WalletFREE CPD Wallet