21 Jul 2016

1MDB: Malaysia 'will co-operate' with US fraud investigation

9:13 pm on 21 July 2016

Prime Minister Najib Razak's office has said Malaysia will "fully co-operate" with any investigation into state fund 1MDB after the US said it "defrauded" Malaysians.

Malaysian Prime Minister Najib Razak

Malaysian Prime Minister Najib Razak (file) Photo: AFP

US authorities moved Wednesday to seize more than $1 billion in assets from the fund set up by Mr Najib.

Mr Najib is not named but "Malaysia official 1" is identifiable as someone whose account allegedly received funds.

This is a major development in a case that has gripped the region.

Mr Najib was officially cleared of criminality by the country's attorney general earlier this year. He has always denied any wrongdoing.

There is no allegation that Mr Najib spent any of the money but people close to him are accused of using billions of dollars to buy jewellery, art and luxury properties; pay gambling expenses; and hire musicians and celebrities to attend parties.

A spokesperson for Mr Najib said the government would "fully co-operate with any lawful investigation of Malaysian companies or citizens in accordance with international protocols".

"As the prime minister has always maintained, if any wrongdoing is proven, the law will be enforced without exception."

A spokesperson for Mr Najib said the government would "fully co-operate with any lawful investigation of Malaysian companies or citizens in accordance with international protocols".

"As the prime minister has always maintained, if any wrongdoing is proven, the law will be enforced without exception."

The $1bn would only make up a proportion of the money that was allegedly diverted, which comes to more than $3.5bn.

Mr Najib's stepson, Riza Aziz - who produced the Leonardo DiCaprio film The Wolf of Wall Street - is named in the court papers, as are a Malaysian financier and two Abu Dhabi government officials.

The fund started to attract attention in early 2015 when it missed payments for the $11bn it owed to banks and bondholders.

The Wall Street Journal reported it had seen a paper trail that allegedly traced close to $700m from the troubled fund to Mr Najib's personal bank accounts.

1MDB said in a statement last year that it had never given money to the prime minister and called the claims "unsubstantiated". It has repeatedly stated that the company has assets worth more than its debts.

- BBC