Malaysian authorities freeze 6 bank accounts linked to PM graft scandal

Kuala Lumpur: A task force investigating Malaysia's troubled state investment fund 1MDB said on on Tuesday it had frozen half a dozen bank accounts following a media report that nearly $700 million had been transferred to an account of Prime Minister Najib Razak.

The Wall Street Journal (WSJ) reported last week that investigators probing the debt-laden 1MDB had traced nearly $700 million to bank accounts they believed belonged to the prime minister. Reuters could not independently verify the WSJ report. Najib has denied taking any money from 1MDB or any other entity for personal gain, and is considering legal action.

The special task force said it had frozen six bank accounts in relation to the allegations, but it did not specify whose accounts they were or the banks involved. The team also took possession of documents related to 17 accounts from two banks to help with the investigations. Former prime minister Mahathir Mohamad, who was once Najib's patron and remains highly influential, weighed into the scandal on today saying Najib had shamed Malaysia.

"Truly, the one who shamed the country is Najib with his 1MDB. Prior to this, the country has never been insulted by unanswered allegations, unlike now," Mahathir said in a blog.

Malaysia's longest-serving prime minister has repeatedly demanded Najib account for the disappearance of billions of dollars borrowed by state fund 1MDB, or resign. The attorney-general said on Saturday he had received documents from the investigating task force that are "connected to allegations" money was transferred into the prime minister's account.

Opposition Blocked 

Malaysian opposition lawmakers on today accused authorities of blocking a planned meeting in parliament to discuss the allegations against Najib, which threaten to become the biggest political crisis in the country's history.

About 100 lawmakers, activists and lawyers were prevented from entering a meeting room in parliament, and were left sitting on the steps outside the building in downtown Kuala Lumpur. Officials said the room had been double booked, and was being used by the Youth and Sports Ministry.

"It's fairly obvious what the authorities are doing. They are in cahoots to stop any discussion about the allegations the prime minister is facing," said Tony Pua, a lawmaker from the Democratic Action Party (DAP).

Meanwhile, members of Najib's party, the United Malays National Organisation (UMNO), have closed ranks behind the prime minister, who had already been on a back foot over the mismanagement of 1MDB and his handling of the economy.

1MDB, whose advisory board is chaired by Najib, has debts of nearly $11.6 billion. Even before the WSJ report it was the subject of separate investigations by the central bank, auditor general, police and the parliament's Public Accounts Committee.

The Wall Street Journal, citing documents from a government investigation, said there were five deposits into Najib's account. It said the two largest transactions, worth $620 million and $61 million, were made in 2013 from a company registered in the British Virgin Islands via a Swiss bank. 1MDB has described the allegations as "unsubstantiated", saying it never provided funds to the prime minister.