Explained: Malaysia’s 1MDB Scandal

1Malaysia Development Berhad (1MDB) is a state investment fund that came under investigation for a multibillion-dollar global corruption scandal.
The US Department of Justice (DOJ) alleges US$4.5 billion was siphoned from 1MDB between 2009 and 2014. The scandal has been described as the world’s most extensive financial con.
Who are the central figures in the 1MDB scandal?
Low is wanted by several countries and subject to a global manhunt. He denies any wrongdoing and is widely speculated to be in China.
Disgraced former Malaysian prime minister Najib Razak faces more than 40 counts of criminal breach of trust, money laundering and abuse of power. Najib, who founded and chaired 1MDB, stands accused of diverting some US$700 million from SRC International – a former subsidiary of 1MDB – into his personal bank accounts.
A cover-up?
When the 1MDB scandal first broke in 2015, Najib’s government sought to quash investigations by the Malaysian Anti-Corruption Commission (MACC) despite five other countries, including the US, opening their own probes.
Current and former government officials said Najib’s administration threatened MACC investigators and wrote many press releases published by the anti-corruption agency.
How is Goldman Sachs involved?
CEO David Solomon has apologised to Malaysia for ex-banker Tim Leissner’s role in the 1MDB scandal. Leissner, a former partner for Goldman Sachs in Asia, pleaded guilty in the US to conspiring to launder money and violate the Foreign Corrupt Practices Act.
How has it affected Malaysian politics?
The change in government in Malaysia has affected the country’s diplomatic relations with China.
Source: SCMP