KUALA LUMPUR (AFP) - A controversial British former media adviser to Malaysian ex-leader Najib Razak has had money-laundering charges dropped after agreeing to pay US$1.7 million (S$2.3 million) to scandal-hit sovereign wealth fund 1MDB, officials said Friday (July 30).

Paul Stadlen is believed to have left the country shortly after his boss, former prime minister Najib, suffered a shock election defeat in 2018.

Mr Najib and many of his confidants faced corruption charges after the polls for their roles in a massive scandal involving the fund, 1Malaysia Development Berhad (1MDB).

Billions of dollars were looted from 1MDB in a fraud that spanned the globe, with the money spent on everything from a super-yacht to art.

Stadlen, whose whereabouts remain unknown, was charged in absentia in 2019 with laundering more than 14 million ringgit (S$4.47 million).

But the anti-graft agency said the charges were dropped after he agreed to pay back nearly 7.2 million ringgit (S$1.7 million).

They added that the case against him had been withdrawn, with the money to be transferred into a 1MDB trust account.

Stadlen was alleged to have channelled the funds in 2014 and 2015 from an account belonging to a law firm to various people and companies.

The firm's managing partner, Hafarizam Harun, also had money-laundering charges related to 15 million ringgit dropped, the agency said, and was served with a 600,000 ringgit fine.

Reputed to have a playboy lifestyle while in Malaysia, Stadlen was known for his strong defence of Mr Najib's innocence even as the premier faced mounting criticism over the 1MDB scandal.

Mr Najib's long-ruling coalition lost power in 2018 in large part due to the fraud, and since then authorities have been working to get back looted funds.

The former premier was convicted and sentenced to 12 years in jail last year following his first trial linked to the 1MDB scandal. He remains free on bail while he appeals.