Malaysia to widen 1MDB probe to BN parties, politicians

  • Malaysia’s new government has widened its investigation into state-owned 1Malaysia Development Berhad (1MDB) to cover flows of funds to parties in former ruling coalition Barisan Nasional (BN), in a move that could have far-reaching ramifications for the country’s political landscape.
  • Senior government officials and financial executives told The Straits Times that investigators are looking into money flowing from companies tied to 1MDB and fund transfers from former prime minister Najib Razak’s private accounts to key BN partners and politicians.
  • The probe, which is being carried out by regulatory agencies under the sweeping Anti-Money Laundering Act, has also extended to law firms tied to the previous administration, the officials said.
  • The parties and legal firms in possession of funds that flowed out of 1MDB or its related entities could find their bank accounts frozen by the authorities pending a full investigation and trial. Elected representatives would not only have their bank accounts frozen but could also face being disqualified as MPs or state assemblymen if found guilty.
  • Government officials expect the Mahathir administration to level charges related to corruption, embezzlement of state resources and national economic sabotage against Najib early in Jul 18.
  • The ability to dispense patronage has long been the lifeblood of key BN members such as the United Malays National Organisation (Umno) and the Malaysian Chinese Association (MCA).
  • Both parties have sizeable business interests. Umno has long used its unfettered authority over government to dispense lucrative licences, contracts and powerful positions at state-owned entities to reward political warlords and senior officials.
  • The party’s business interests, grouped under a private company called Temasek Padu Sdn Bhd – estimated to be valued at roughly MYR800mn – features equity holdings in companies that operate the private Subang airport in the outskirts of Kuala Lumpur, a property project and a shipyard in East Malaysia.
  • The MCA’s business assets, estimated to be in excess of MYR3bn, are grouped under a private entity called Huaren Holdings Sdn Bhd. Its investments include extensive property developments, control of Star Publications, which operates the country’s largest English-language daily newspaper, and the running of higher learning institutions.
  • By-elections that may be called as a result of the disqualification of elected representatives being found guilty of receiving tainted 1MDB-related funds could further undermine BN’s representation in Parliament.
  • It now holds 57 seats – Umno with 54, MCA with one and the Malaysian Indian Congress with two – in the 222-seat Parliament, a far cry from the 133 seats it won in the 2013 election.

External Link: https://www.straitstimes.com/asia/se-asia/malaysia-to-widen-1mdb-probe-to-bn-parties-politicians

21-Jun-2018


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