Mahathir urges US not to give 1MDB funds back to KL

(Reuters) – The United States should “think twice” before giving Malaysia back the money recovered from an anti-kleptocracy probe into 1Malaysia Development Berhad (1MDB), former prime minister Mahathir Mohamad said last month, as the party accused of graft at the state fund is now back in power.

Finance Ministry: Malaysia Received RM2.7b In 1MDB Funds From US DoJ So Far

Tun Dr Mahathir, 94, abruptly resigned in February before being replaced by Tan Sri Muhyiddin Yassin, whose coalition includes former ruling party Umno, despite voters rejecting Umno in the 2018 general election amid a backlash over the multibillion-dollar scandal at state fund 1MDB.

The US Department of Justice (DOJ) says more than US$4.5 billion (S$6.3 billion) was looted from 1MDB under then Umno chief Najib Razak, the former premier who is now on trial for allegedly receiving some of the stolen money.

The DOJ, in its biggest anti-kleptocracy case, has recouped about US$1 billion from the seizure and sale of assets allegedly bought with 1MDB funds.

The DOJ returned nearly US$200 million to Malaysia last May, but a second transfer of about US$240 million was delayed last month amid uncertainty following Dr Mahathir’s resignation, sources have said.

Dr Mahathir told Reuters that the DOJ should reconsider its decision to send the money to Malaysia after the return of Najib’s party to the government.

“When we took over, the DOJ was willing to give it to us because we overthrew the people who stole the money,” he said in an interview.

“Now, the people who stole the money are going to get back the money they stole. I think the DOJ will have to think twice.”