Malaysia examining whether China offered to bail out 1MDB

China also offered to bug the homes and offices of Wall Street Journal reporters in Hong Kong who were investigating 1MDB, to learn who was leaking information to them, said the Wall Street Journal.
China also offered to bug the homes and offices of Wall Street Journal reporters in Hong Kong who were investigating 1MDB, to learn who was leaking information to them, said the Wall Street Journal.PHOTO: ST FILE

WASHINGTON (BLOOMBERG) - Malaysia is looking into allegations that China offered to help deter probes into 1MDB in exchange for infrastructure projects, after the Wall Street Journal reported that senior Chinese leaders offered to help bail out the troubled state fund in 2016. 

The government is unaware of the discussions detailed in the Journal report, which cited minutes from meetings the newspaper reviewed, and is examining the matter, said Finance Minister Lim Guan Eng. 

The cost of China-backed projects was certainly enlarged and Malaysia will check whether that was due to 1Malaysia Development Berhad (1MDB) links, Mr Lim said near Kuala Lumpur on Tuesday (Jan 8).  

“But I have to refer back to see if there are details or thing explicitly said,” he said. "If this is said, this is something we will pursue.” 

Chinese officials told visiting Malaysians that China would use its influence to try and get the United States and other countries to drop probes of allegations that allies of then Prime Minister Najib Razak and others plundered the fund, according to the newspaper.

In return, Malaysia offered stakes in railway and pipeline projects as part of China's Belt and Road Initiative. The Chinese government information office did not respond to requests for comment, the WSJ said, adding that China's Foreign Ministry had earlier denied that money in the programme was used to help bail out the 1MDB fund.

1MDB is at the centre of a global scandal involving claims of embezzlement and money laundering, with jurisdictions from the US, Malaysia and Singapore probing cases related to the fund. Najib has been charged with dozens of counts of corruption, criminal breach of trust and money laundering involving 1MDB-related monies.

He also stands accused of altering the report on a government audit into the fund to protect himself from criminal, civil or regulatory action. He has denied wrongdoing and pleaded not guilty to all charges.

China also offered to bug the homes and offices of Wall Street Journal reporters in Hong Kong who were investigating 1MDB, to learn who was leaking information to them, the newspaper said, citing the minutes of the meetings. It could not be determined whether China provided any such information, the newspaper added.