World News

Azmin says not privy to details of WSJ's report on 1MDB, deals

Azmin says not privy to details of WSJ's report on 1MDB, deals

The "Wall Street Journal" reported in a lengthy investigative story citing Insider and protocols of internal meetings.

Malaysian court on January 7 refused bail to former Goldman Sachs banker Roger Ng, pending his extradition to the United States where he faces charges related to suspected money laundering of funds siphoned off from state fund 1MDB.

A series of meetings organised by the Journal have revealed that Chinese officials told Malaysian counterparts that China would try to deter corruption probes by the USA and others into the so-called 1MDB fund, if Malaysia agreed to grant China deals as part of its Belt and Road Initiative.

The WSJ article also reported clandestine talks between then prime minister Najib and Chinese officials to allow naval ships from China to dock at Malaysian ports.

China has described a report accusing the Chinese government of trying to influence the investigation into the 1Malaysia Development Berhad (1MDB) scandal as being "groundless".

The Malaysian government will scrutinise bilateral deals made with China under the previous government, finance minister Lim Guan Eng said on Tuesday (Jan 8). In return Malaysia offered China lucrative stakes in railway and pipeline projects for Beijing's Belt and Road infrastructure initiative, the report said.

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Malaysian prosecutors say there is no conflict between the American attempt to extradite Ng and the charges he faces in Malaysia, and suggest the United States will wait for proceedings in Malaysia to wrap up before moving forward with their case. The Chinese government information office didn't respond to requests for comment, the WSJ said, adding that China's foreign ministry has earlier denied that money in the program was used to help bail out the 1MDB fund.

According to the Journal report, Malaysian officials allegedly suggested that some of the infrastructure projects should be financed at above-market values, which would generate extra money for other needs.

Najib has since been charged with corruption over 1MDB.

Goldman Sachs has consistently denied wrongdoing, saying that certain members of the former Malaysian government and 1MDB had lied to it about the proceeds of the bond sales. It couldn't be determined whether China provided any such information, the newspaper added.

Shortly after the meetings, former Prime Minister Najib Razak signed $34 billion of railway and pipeline projects to be led by Chinese state-run companies and bankrolled by Chinese banks.

The U.S. Justice Department has estimated that a total of $4.5 billion was misappropriated by high-level 1MDB fund officials and their associates between 2009 and 2014, including some of the funds that Goldman Sachs helped raise.