Mahathir probed over Malaysia forex losses

(AP) – Malaysia’s government yesterday launched a royal commission into massive foreign exchange losses by the central bank more than two decades ago, in a probe that could lead to criminal prosecution for former prime minister Mahathir Mohamad.

Opposition leaders slammed the inquiry as a ploy to discredit Dr Mahathir months after he set up a new political party. He now leads an opposition coalition aimed at ousting Prime Minister Najib Razak in general elections due in mid-2018.

Dr Mahathir, 92, led the country for 22 years before stepping down in 2003.

He has been spearheading calls for Mr Najib to resign over a multi-billion-dollar financial scandal in indebted state fund 1MDB. The fund is being investigated in several countries for money laundering. Mr Najib has denied any wrongdoing.

The five-member royal commission, meeting for the first time yesterday, said it would investigate how much the central bank lost in currency trading in the 1990s and determine if there was a cover-up.

The inquiry was set up after the government said a preliminary investigation found that the extent of losses was larger than what was reported to the cabinet and parliament.

Dr Mahathir has said the inquiry is a “desperate effort by Najib to silence his detractors”. He and other opposition leaders have urged the government to also set up a formal inquiry into losses at 1MDB. The US Justice Department says at least $US4.5 billion ($5.7bn) has been stolen from 1MDB.