U.S. isn’t buying Malaysian leader’s story
BANGKOK — A U.S. Justice Department complaint filed in federal court this week directly contradicts repeated assertions by the Malaysian prime minister, Najib Razak, about the origins and purpose of hundreds of millions of dollars that ended up in his personal bank accounts.
While Najib and other Malaysian officials have insisted that the money was a gift from an unidentified Saudi donor, the Justice Department said that it was stolen from a Malaysian government investment fund that Najib oversaw. Najib has said he never received any money from the fund.
The court filing, one of several complaints filed Wednesday in a federal money-laundering investigation, provides the first official public documentation of transactions that challenge Najib’s version of events in a scandal that has battered his government for the past year.
The revelations could undermine his credibility and give new ammunition to a movement to force him from office. However, he maintains firm control over his governing party and has successfully stifled opposition with the firing of critics from party posts, the closing of online news outlets and the criminal prosecution of social media detractors and political opponents.
Najib, who has acknowledged receiving the money but said he broke no laws and took nothing for personal gain, told reporters on Thursday that his government would “fully cooperate” with the Justice Department action.
“Allow the process to take its course,” he said, “but I want to say categorically that we are serious about good governance.”
A spokesman for Najib said that the prime minister had not changed his position that the money he received was a gift from a Saudi donor and that he gave most of it back because he did not need it.
While the Justice Department complaint is an allegation, not evidence, it outlines in 136 pages of blow-by-blow detail how huge sums were diverted from the government fund, routed through bank accounts in various countries and then spent on highend real estate, artwork, gambling and various luxury goods by Najib’s stepson, friends and associates.
The court filing seeks to recover more than $1 billion in assets bought with money that prosecutors say was stolen from the fund, known as 1Malaysia Development Berhad, or 1MDB.
Those assets, Attorney General Loretta Lynch said Wednesday, “are just a portion of the more than $3 billion that was stolen from 1MDB and laundered through American financial institutions in violation of United States law.”
The case, she said, should be seen as a sign of the country’s “firm commitment to fighting international corruption” and the department’s determination “to protect the American financial system from being used as a conduit for corruption.”
The United States is among several governments, including Malaysia, Singapore and Switzerland, that have investigated 1MDB.
The inquiries began last year after an investigative report in the New York Times traced the purchases of about $150 million in residential properties and artwork in the United States to relatives or associates of Najib.
While the federal complaint does not identify Najib by name, it cites $731 million in funds that came from 1MDB that were deposited into accounts belonging to a government official identified as “Malaysian Official 1.”
However, Najib is clearly recognizable in the descriptions and actions attributed to that official.