As Doonsbury’s Uncle Duke put it so memorably, “But the pension fund was just sitting there!” The temptation to look money set aside for working people is a constant threat, as shown in two current headlines about the Malaysian sovereign wealth fund.
A Malaysian court sentenced former Prime Minister Najib Razak to serve 12 years in prison on Tuesday after finding him guilty in the first of several corruption trials linked to the multibillion-dollar looting of the 1MDB state investment fund that brought down his government two years ago.
Najib was calm and stone-faced as he became the first Malaysian leader to be convicted. He took an oath in brief remarks in the dock that he was innocent.
Judge Mohamad Nazlan Ghazali sentenced Najib to 12 years in jail on one count of abuse of power, 10 years each for three counts of criminal breach of trust, and 10 years each for three counts of money laundering, as well as a fine of 210 million ringgit ($49.4 million). But he ordered the sentences to run concurrently, meaning that Najib will face only up to 12 years in jail.
The judge allowed a stay of the jail sentence and fine pending Najib’s planned appeal. But he raised the bail amount and ordered Najib to report to the police twice a month.
And a London law firm with Saudi connections is alleged to have embezzled $340 million from the Malaysian fund as well.
Investigators probing one of the world’s largest financial frauds have said they suspect $340m (£255m) held in the bank account of a major London law firm is linked to money allegedly embezzled from the Malaysian state investment fund 1MDB.
According to court papers, Malaysia’s anti-corruption agency is urgently trying to prevent City firm Clyde & Co from releasing the large sum of money, which they suspect can be traced to proceeds of the multibillion-dollar 1MDB fraud.
The sprawling 1MDB scandal has shaken Malaysian politics in recent years and sparked investigations around the world into how billions of dollars were siphoned from the fund and laundered through an elaborate network of bank accounts and offshore companies to pay bribes and finance luxury lifestyles.