KUALA LUMPUR • Senior officials at scandal-plagued state fund 1Malaysia Development Berhad (1MDB) withheld information from its board and took some decisions without the board's approval, a Malaysian government audit of the fund, which was declassified yesterday, had found.
The previous government led by former prime minister Najib Razak had classified the report "secret" in 2016 when the fund's financial troubles were being investigated.
Reports had emerged by then that around US$700 million (S$940 million) from 1MDB had gone to Datuk Seri Najib's personal bank accounts. Mr Najib denied any wrongdoing and was cleared by then Attorney-General Apandi Ali.
But after he lost last week's general election, new Prime Minister Mahathir Mohamad said he would reopen investigations into 1MDB and declassify the audit report. Tun Dr Mahathir has barred Mr Najib and his wife from leaving the country, and replaced Tan Sri Apandi.
Yesterday, Dr Mahathir met Auditor-General Madinah Mohamad, who announced the declassification of the report and said its executive summary would be available on her department's website.
"In several instances, the 1MDB management had presented incomplete or inaccurate information to the 1MDB board before an important decision was made and had taken action without the approval of the 1MDB board," the report said.
It noted that between 2009 and 2015, several decisions involving high-value investments were made through 1MDB board resolutions without detailed discussion or evaluation. Several high-risk investments were made in a very short time, and the 1MDB management went against the board's and the shareholders' wishes in some instances, it added.
"There were also instances where the 1MDB management gave inaccurate or different information to interested parties," the report said.
Files and records were also not kept in a systematic fashion.
Malaysiakini news website noted the declassified report lacks details due to the fund's refusal to provide complete documentation, but for key parts which were investigated, the information corroborates with that of the US Department of Justice. The Audit Department had, among others, examined the accounts of 1MDB subsidiary Brazen Sky Limited, and found irregularities.
The US Department of Justice has filed civil lawsuits alleging that over US$4.5 billion was misappropriated from 1MDB by high-level officials and their associates.
The lawsuits seek to seize about US$1.7 billion in assets, including a luxury yacht and paintings, that were bought with 1MDB funds.
The lawsuits name Malaysian financier Low Taek Jho, also known as Jho Low, and Mr Najib's stepson Riza Aziz among the alleged beneficiaries of misappropriated funds. Both have denied wrongdoing.
A person described in the US lawsuits as "Malaysian Official 1" was said to have received more than US$1 billion in 1MDB funds, some of which was used to buy jewellery for the person's wife.
US and Malaysian sources have said "Malaysian Official 1" refers to Mr Najib. Mr Najib has denied any wrongdoing.
Meanwhile, a federal judge in Los Angeles said on Monday she will issue an order on the department's request to get custody of the Equanimity, Mr Low's US$250 million yacht allegedly bought with siphoned funds. The yacht was seized by Indonesian authorities in Bali in February.
Separately, federal prosecutors in Switzerland are seeking quick talks with Malaysian counterparts on how to press forward with an investigation of 1MDB, the Swiss attorney-general's office added.
REUTERS
