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Former Malaysian PM Najib arrested in graft probe

Reuters / Share:
Commissioner Amar Singh, Malaysia's Federal Commercial Crime Investigation Department (CCID) director, displays photos of items from a raid during a news conference in Kuala Lumpur, Malaysia June 27, 2018. REUTERS/Lai Seng Sin

KUALA LUMPUR (Reuters) – Malaysia’s former prime minister Najib Razak has been arrested and will be charged today in relation to a probe into SRC International, a former unit of troubled state fund 1MDB.

A task force investigating a multi-billion dollar scandal at 1Malaysia Development Berhad (1MDB) said in a statement that Mr Najib was arrested in the afternoon at his home.

Anti-graft agents picked up Mr Najib after serving him with a remand order, sources close to the family said. A Najib spokesman did not immediately have a comment and Mr Najib has consistently denied wrongdoing.

Founded by Mr Najib in 2009, 1MDB is being investigated in at least six countries for alleged money laundering and graft.

Civil lawsuits filed by the US Department of Justice allege that nearly $4.5 billion from 1MDB was laundered through a complex web of transactions and shell companies.

But the initial focus of the Malaysian Anti-Corruption Commission (MACC) investigation focused on how 42 million ringgit ($10.6 million) went from SRC International to Mr Najib’s account.

SRC was created in 2011 by Mr Najib’s government to pursue overseas investments in energy resources, and was a unit of 1MDB until it was moved to the finance ministry in 2012.

MACC has been able to track the money trail from SRC more easily because transactions were made through Malaysian entities, whereas most other transfers of 1MDB funds went through foreign banks and companies.

Malaysian police say they have seized nearly $275 million worth of jewelery, handbags, watches and cash from premises linked to Mr Najib, while authorities have frozen more than 400 bank accounts as part of the 1MDB probe.

Mr Najib’s wife, Rosmah, has also been quizzed by anti-graft investigators in relation to 1MDB and Mr Najib’s stepson, Riza Aziz, was giving a statement to the MACC when news broke of Mr Najib’s arrest.

Riza Aziz is the co-founder of Red Granite Pictures, a company that US prosecutors say financed three Hollywood films, including the 2013 Martin Scorsese movie “The Wolf of Wall Street”, with funds misappropriated by 1MDB.

Since his shock election loss to Mahathir Mohamad in May, Mr Najib has been barred from leaving the country, quizzed by the anti-graft agency and had his personal and family houses searched as part of the 1MDB probe.

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