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Exclusive: Evidence that Malaysia's Najib received 1MDB funds was ignored, probe panelists say

Reuters  |  KUALA LUMPUR 

By Rozanna Latiff

KUALA LUMPUR (Reuters) - The (MACC) found evidence in late 2015 that 42 million ringgit ($10.6 million) was transferred from a former subsidiary of state fund 1MDB into an account of then Najib Razak, but its recommendation for further investigation was rejected by the attorney general, a member of a panel that reviewed the commission's case files told

Najib, who was ousted in a shock election loss on May 9, has consistently denied wrongdoing in connection with alleged graft involving (1MDB), and insisted $681 million of funds deposited in his personal were a donation from a Saudi royal. The $10.6 million would be in addition to that sum.

Newly elected Mahathir Mohamad, who was sworn in on Thursday, has vowed to investigate the 1MDB scandal and take action against those who may have abetted or benefited from corruption at the fund. At least six countries, including the and Switzerland, are investigating claims that $4.5 billion was allegedly siphoned off from 1MDB.

In an interview with Reuters, panel member said then attorney-general, Ali, had been presented with evidence by MACC at the end of 2015 that Najib had received the $10.6 million from 1MDB unit

Ali, who was replaced as on Monday, declined to probe further, Lim said.

"AG refused to investigate further despite evidence suggesting that Najib received directly or indirectly 42 million ringgit from SRC," Lim said, using the acronym for the

declined to comment when contacted by MACC did not respond to Reuters' requests for comment.

COMPELLING EVIDENCE

Lim, and another panel member, P. Sundramoorthy, a from the Malaysian Science University, also said that Mohamed Apandi declined repeated requests from MACC to seek legal assistance from foreign governments to trace missing funds from 1MDB. Lim said that they were unable to follow the money trail because it went outside the country.

"We kept telling the AG...please make mutual legal assistance from other jurisdictions to find out the money trail in those jurisdictions. We knew the movement of money in Malaysia, but once it leaves Malaysia, we didn't know where the money went," Lim said.

"Based on the panel review, we felt the case should not have been closed as there was compelling information to say that the case could be further investigated," Sundramoorthy said.

However, he added that he could not recall the amount that MACC suspected Najib had received from SRC.

Neither Najib nor his could be reached by phone to comment for this report.

Najib's told Channel Asia in January 2016 that Najib denies receiving the 42 million ringgit from SRC into his personal

1MDB did not respond to a request for comment.

Lim, a lawyer, was part of an eight-member panel tasked in early 2016 with reviewing investigations by the MACC into a reported transfer of $681 million into Najib's bank account, as well as the transactions linked to SRC. MACC appoints such panels when its recommendations have been rejected by the as part of a review process.

SRC is no longer a unit of 1MDB. It now reports to the

PUT ON LEAVE

Newly elected said on Monday that had been put on leave and the would take over his duties.

Both Lim and Sundramoorthy declined to go into specific details regarding the case files, as the documents are protected under Malaysia's

But the panel was given detailed briefings and full access to the MACC files, they said.

"The biggest disappointment to us was Apandi," said Lim. "MACC was very professional, they did a very good job. But their hands were tied by the AG," he said.

The (DOJ) alleged that about $4.5 billion was misappropriated from 1MDB, which was founded by Najib. The department has filed civil lawsuits seeking to seize about $1.7 billion worth of 1MDB-linked assets, and is also pursuing a criminal probe.

The DOJ has not named any targets of the probe but the civil lawsuits have named Malaysian Low Taek Jho, also known as Jho Low, and Najib's stepson among the alleged beneficiaries of misappropriated 1MDB funds. Both have denied wrongdoing.

A person described in the U.S. lawsuits as "Malaysian 1" was said to have received more than $1 billion in 1MDB funds, some of which was used to buy jewelry for the person's wife. U.S. and Malaysian sources have said "Malaysian 1" refers to Najib.

Najib has denied any wrongdoing and said in 2016 that the will cooperate with U.S. investigations.

($1 = 3.9450 ringgit)

(Reporting by Rozanna Latiff; Editing by Praveen Menon, John Chalmers and Martin Howell)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Tue, May 15 2018. 11:07 IST
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