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1MDB: The case that's riveting Malaysia 1MDB: The case that's riveting Malaysia
(about 1 month later)
Malaysians are no strangers to money politics but the high-profile players and the amount of funds allegedly involved in the so-called "1MDB scandal" have gripped the nation.Malaysians are no strangers to money politics but the high-profile players and the amount of funds allegedly involved in the so-called "1MDB scandal" have gripped the nation.
What is the controversy about?What is the controversy about?
It stems from Prime Minister Najib Razak's strategic state fund called 1Malaysia Development Bhd (1MDB) set up in 2009 when he came into office. The fund is meant to turn Kuala Lumpur into a financial hub. It started to attract national attention recently, when it missed payments for the $11bn (£7.1bn; €9.9bn) it owes to banks and bondholders. It stems from Prime Minister Najib Razak's strategic state fund called 1Malaysia Development Bhd (1MDB) set up in 2009 when he came into office. The fund is meant to turn Kuala Lumpur into a financial hub.
Former Prime Minister Mahathir Mohamad says the fund has taken on too much debt and lacks transparency. He also criticised Mr Najib's family's "lavish" lifestyle, which has been regularly discussed in the local press. It started to attract national attention when it missed payments for the $11bn (£7.1bn; €9.9bn) it owes to banks and bondholders.
Then the Wall Street Journal (WSJ) reported that it had seen a paper trail that allegedly traces close to $700m from the troubled fund to Mr Najib's personal bank accounts. Former Prime Minister Mahathir Mohamad has said the fund has taken on too much debt and lacks transparency. He has also criticised Mr Najib's family's "lavish" lifestyle, which has been regularly discussed in the local press.
Then the Wall Street Journal (WSJ) reported it had seen a paper trail that allegedly traces close to $700m from the troubled fund to Mr Najib's personal bank accounts.
Mr Najib is now facing calls to prove his assets are legal.Mr Najib is now facing calls to prove his assets are legal.
What do those involved say?What do those involved say?
1MDB said in a statement that it has never given money to the prime minister and called the claims "unsubstantiated." It repeatedly states that the company has assets worth more than its debts.1MDB said in a statement that it has never given money to the prime minister and called the claims "unsubstantiated." It repeatedly states that the company has assets worth more than its debts.
Prime Minister Najib also denied taking money from 1MDB or any public funds, and his lawyers have demanded an explanation from the WSJ on its report. Mr Najib also denied taking money from 1MDB or any public funds, and his lawyers have demanded an explanation from the WSJ on its report.
According to the New Straits Times, he told local reporters that it was "illogical" for him to embezzle money and then stash it in his personal account. According to the New Straits Times, he told local reporters that it was "illogical" for him to embezzle money and then stash it in his personal account.
Then in a post on his Facebook page, he accused his fiercest critic, Mr Mahathir, of "political sabotage".Then in a post on his Facebook page, he accused his fiercest critic, Mr Mahathir, of "political sabotage".
Prime Minister Najib said he believed Mr Mahathir worked "hand in glove" with foreigners as part of a campaign "to topple a democratically elected prime minister." He said these attacks began when he refused to implement Mr Mahathir's "personal demands". Mr Najib said he believed Mr Mahathir worked "hand in glove" with foreigners as part of a campaign "to topple a democratically elected prime minister." He said these attacks began when he refused to implement Mr Mahathir's "personal demands".
What's the latest?What's the latest?
The BBC put Prime Minister Najib's allegations to Mr Mahathir, who dismissed the claims. Instead, he called on the prime minister to show proof that he didn't pocket state funds. The BBC put Mr Najib's allegations to Mr Mahathir, who dismissed the claims. Instead, he called on the prime minister to show proof that he didn't pocket state funds.
Meanwhile, there are a few official investigations into the 1MDB fund, including a special task force headed by the attorney general. The team raided the office of 1MDB on Wednesday and took away some documents. Mr Najib has said the money is a donation and Malaysia's anti-corruption commission says it has verified that claim, adding that the donors who deposited the money are from the Middle East. It did not disclose their identities.
1MDB said in a statement that it was co-operating with the task force and all legal authorities in their investigations. The accounts have since been closed and it is not known where the money is now.
Meanwhile, there are a few official investigations into the 1MDB fund, including a special task force headed by the attorney general. The team raided the office of 1MDB and took away some documents.
But Mr Najib subsequently removed the attorney general on health grounds and the investigation has been suspended.
Swiss authorities have opened criminal proceedings related to 1MDB on "suspected corruption of public foreign officials, dishonest management of public interests and money laundering".
Could this spell the end for Najib?Could this spell the end for Najib?
Not necessarily. The opposition Pakatan Rakyat alliance has effectively collapsed from infighting so there is less outside pressure on Prime Minister Najib.Not necessarily. The opposition Pakatan Rakyat alliance has effectively collapsed from infighting so there is less outside pressure on Prime Minister Najib.
His greatest threat comes from his own governing party and in particular Mr Mahathir, who is still regarded as the father of modern Malaysia and highly respected.His greatest threat comes from his own governing party and in particular Mr Mahathir, who is still regarded as the father of modern Malaysia and highly respected.
This is Mr Mahathir's third campaign against the men he groomed to be the country's next leaders. He successfully ousted his deputy, Anwar Ibrahim, in the late 1990s and also forced his successor, Abdullah Badawi, to step down. Now Mr Mahathir has called on Prime Minister Najib to resign. This is Mr Mahathir's third campaign against the men he groomed to be the country's next leaders. He successfully ousted his deputy, Anwar Ibrahim, in the late 1990s and also forced his successor, Abdullah Badawi, to step down. Now Mr Mahathir has called on Mr Najib to resign.
Pro-democracy group Bersih has also demanded his resignation.
What do Malaysians think about it?What do Malaysians think about it?
The 1MDB controversy had been featured prominently in the local press for months but few Malaysians understood what it could mean until the WSJ report.The 1MDB controversy had been featured prominently in the local press for months but few Malaysians understood what it could mean until the WSJ report.
It now resonates with many Malaysians who are struggling with the rising cost of living. The alleged mismanagement of a state fund makes many poor Malaysians resent paying the new broad-based consumption tax.It now resonates with many Malaysians who are struggling with the rising cost of living. The alleged mismanagement of a state fund makes many poor Malaysians resent paying the new broad-based consumption tax.
But it hasn't made Malaysians lose their sense of humour.But it hasn't made Malaysians lose their sense of humour.
One social media trend is to think of major film titles with a 1MDB twist. One social media trend recently was to think of major film titles with a 1MDB twist.
Some of the more popular ones include: "Frozen (bank accounts)", "42 billion shades of debt", "How to train your ministers" and "The debt knight rises." Some of the more popular ones included: "Frozen (bank accounts)", "42 billion shades of debt", "How to train your ministers" and "The debt knight rises."
One Twitter user summed up the feeling of confusion in the country: "Malaysia is now in the darkest of political times."One Twitter user summed up the feeling of confusion in the country: "Malaysia is now in the darkest of political times."
Malaysian authorities have, in recent weeks, blocked online access to a website and newspapers that covered the 1MDB scandal extensively.