Mahathir Pressure Singapore On 1MDB

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Mahathir Mohamad has attacked ’s handling of alleged money-laundering linked to Malaysian state investment fund 1MDB.

In an interview with the Financial Times, ’s influential former prime minister accused Singapore of failing to target the protagonists in what is alleged to be a global scheme to siphon off more than $3.5bn from the fund.

“Notice that the government of Singapore is very reluctant to pinpoint the people involved in this corruption,” Mr Mahathir said. “It affects Singapore’s reputation as a financial centre. It is not doing the right thing. The people who accepted the bribes are not the people who are laundering the money.”

The scandal around 1MDB has echoed through the world’s financial system, highlighting apparent failings in money-laundering controls at global banks.

Singapore’s regulator has vowed to carry out more intrusive inspections of banks and is creating a dedicated money-laundering unit, after taking the rare step of ordering the closure of a Swiss bank’s branch in the city-state earlier this year.

Singapore authorities said last month that the country was playing an active role in global investigations into 1MDB-linked fund flows, and that they had charged two people in Singapore with related offences.

Authorities in the city-state say they have seized about S$120m (US$89m) of assets belonging to Jho Low, a Malaysian financier alleged by US prosecutors to have played a central role in the operations of 1MDB, and his family. Mr Low has previously denied any wrongdoing.

“Appropriate actions will be taken against those who have broken Singapore’s laws,” said a spokesperson for the Singapore attorney-general. “As investigations are still ongoing, we are not able to comment any further.”

Last month the US Department of Justice exposed details of transactions in a bid to recover assets it said had been purchased with stolen Malaysian funds. These range from property in London and New York to Van Gogh paintings and the rights to proceeds from the film The Wolf of .

The DoJ case was the first time , prime minister, had been officially tied to the 1MDB scandal. Although not mentioned by name, the description of “Malaysia Official 1” in court documents matches his biography and job description.

The US intervention has given succour to domestic critics of Mr Najib, who set up 1MDB and chaired its advisory board. Mr Najib denies any wrongdoing.

Mr Mahathir, Mr Najib’s former mentor, is seeking to capitalise on the prime minister’s discomfort by launching a political party that aims to be a rallying point for disaffected members of the ruling United Malays National Organisation, which has dominated Malaysian politics for decades.

“It is quite obvious that the party that is being led by Najib is being used by Najib to cover up,” Mr Mahathir said. “The FBI and DoJ have exposed the wrongdoing.”

Mr Mahathir said the primary goal of his new party was “to get rid of Najib”. “For that purpose it will work together with other opposition parties, on this issue alone.”

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