Money in Malaysian PM Najib's accounts from 1MDB, not from Saudis: WSJ editor

Money in Malaysian PM Najib's accounts from 1MDB, not from Saudis: WSJ editor

Following The Wall Street Journal (WSJ) finance editor's claim that Malaysian Prime Minister Najib Razak's "political donation" of RM2.6 billion (S$867.4 million) was not from the Saudi royal family, 1Malaysia Development Bhd (1MDB) has once again refuted that and called his allegation a "lie".

WSJ finance editor Ken Brown told Australia's ABC News in an interview that the newspaper had evidence to back their claim that the money came from companies related to troubled state fund 1Malaysia Development Berhad (1MDB).

But 1MDB said on Friday (Feb 19) that the fact that it had never transferred funds to Mr Najib's accounts has been stated by the authorities, reported The Malaysian Insider

"Contrary to the Wall Street Journal's baseless and unproven allegations, 1MDB has consistently maintained that it has not paid any funds to the personal accounts of the prime minister," 1MDB said in a statement yesterday. 

"This has been reiterated by multiple lawful authorities, including the Malaysian Anti-Corruption Commission, attorney-general, and various reputable international publications, who have confirmed that these funds came from Saudi Arabia."

Last year, WSJ broke the story that close to US$700 million (S$986 million) from 1MDB had been transferred into Mr Najib's personal accounts, citing documents from a government probe.

Various investigations into 1MDB were set up, but in January this year, Malaysia's AG said that the funds had been a gift from the Saudi royal family, and that there was no criminal offence or corruption involved. The AG also said that Mr Najib had returned US$620 million that had not been utilised.

In the ABC News interview, Mr Brown was asked about plans by the Malaysian government to introduce new laws to increase sentences for people who leak official secrets.

"It is no surprise that it comes after the attempt by the government to say that this money that went into the Prime Minister's bank account came from Saudi Arabia. The reality is that no one really believes that," he said.

"Our reporting has shown for months now that the money did not come from the Saudis, but it came via a bunch of companies and bank accounts related to 1MDB," Mr Brown said, adding that their story had not been called into question yet.

He described the saga as a "peel-the-onion" story in which new pieces of information emerged every week, but felt it would be difficult to keep the investigations away from Mr Najib.

When asked if he thought Mr Najib would be able to survive the investigation, Mr Brown highlighted the possibility of Malaysia's ruling United Malays National Organisation (UMNO) party rising up to oppose him due to their frustrations over the scandal and fear of losing power at the next election.

"But it still hasn't happened, and he has retained his control of power," he noted.

He added that moving forward, the "real action" would be from the overseas investigations into 1MDB. "If they find real serious stuff, it will be hard for the Malaysians to ignore it," he said.

Authorities in Singapore, Switzerland, the United Kingdom, the United States and Hong Kong are still investigating the 1MDB affair.

In Singapore, the Commercial Affairs Department and the Monetary Authority of Singapore seized a "large number of bank accounts" linked to the alleged financial misappropriation at 1MDB in January this year.

Among these were the accounts of private banker Yak Yew Chee, who handled the 1MDB account after he joined Swiss private bank BSI.

seanyap@sph.com.sg

maryanns@sph.com.sg

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