The biggest anticorruption news last week was almost certainly the announcement by Malaysia’s new Attorney General clearing Prime Minister Najib Razak of any wrongdoing in connection to the approximately $781 million that mysteriously appeared in his personal bank account. Early reports suggested that the money might have been embezzled from a state investment fund called 1MDB – and the controversy over this matter caused substantial political upheaval (and ended up being a major focus of last year’s International Anti-Corruption Conference, which was held in Malaysia at the height of the scandal). But last week, Attorney General Mohamed Apandi Ali, following up on an earlier statement by the Malaysian Anti-Corruption Commission (MACC), announced that the money was not in fact from 1MDB, but was instead a “political donation” from the Saudi royal family. Attorney General Apandi further stated that the money was given “without any consideration,” that Prime Minister Najib had not done anything unlawful, and that he’d returned $620 million of unused money to the Saudi royal family.
Is this true? Is it really the case that Prime Minister Najib did nothing wrong (or at least nothing illegal)? Of course, I have no idea (though Swiss investigators announced earlier this week that there is indeed evidence of massive misappropriation from 1MDB). I’m not privy to any of the evidence that the MACC and the AG investigated, and I’m at best a casual, intermittent outside observer of Malaysian politics. And it would be nice to live in a world in which, when the most senior justice official in a country announces that allegations of corruption are unfounded, I could simply believe those assertions. After all, not all allegations of corruption are true. Yet in this case, my reaction to the AG’s announcement (even before I read the news about the ongoing Swiss investigations) was cynical disbelief. I may not ever know what actually happened in this case, but what I do know is that pretty much everything that’s happened since news of the scandal broke has shattered any faith that I may once have had that Malaysian institutions undertook a genuine, impartial, investigation of this matter. Indeed, the Malaysian government’s handling of this matter is a textbook example of how a system can damage its credibility, perhaps irreparably.
Just to recap some of the highlights:
- For starters, even after news of the scandal broke Prime Minister Najib refused to offer a full explanation for the source of the money. If it was really so innocuous, it’s more than passing strange that he didn’t just announce that it was a political donation from the Saudi royal family right away.
- More importantly, last July, while the investigation was ongoing, the Attorney General leading the investigation (Abdul Gani Patail) resigned, allegedly “for health reasons” – which is just a notch below “to spend more time with his family” in the canon of barely plausible face-saving explanations offered by a senior official who has just been sacked. (And by the way, the day that a government spokesman announced that Mr. Abdul Gani was stepping down for health reasons, Mr. Abdul Gani himself said that he was not aware of the decision that he was leaving his post and didn’t want to talk about it; only a few months later Mr. Abdul Gani reported that his health was no different than it had been when he was AG.) Around the same time, Prime Minister Najib reshuffled his cabinet, dismissing several other ministers (including the Deputy Prime Minister) who had raised concerns about the scandal.
- Around the same time, the government cracked down on press freedom, suppressing coverage and harassing media outlets that criticized the PM or the government’s handling of the scandal.
- Though the MACC ultimately issued a statement that the money was indeed from an at-that-point-unnamed Middle Eastern source, prior to that announcement the MACC had kept quiet, and a month later the chairman of the MACC advisory board publicly criticized the government’s “meddling” in the commission’s work on the case.
- When the AG made his announcement, he seemed to indicate that the MACC agreed with and supported the decision. But the very next day the MACC’s operations director told the media that the MACC would appeal the AG’s decision, and that the case against the PM was “straightforward.” Other unnamed sources stated that the MACC investigators were “demoralized,” and that the agency had recommended filing criminal misappropriation charges against the PM. The AG’s response was to threaten a police investigation against these “unauthorized statements” to the media, and shortly thereafter the MACC’s Chief Commissioner stated that the MACC was “not disputing” the AG’s finding of no wrongdoing.
- As for the allegedly “lawful” explanation for the $781 million transfer to Prime Minister Najib’s personal account, there are a bunch of things that don’t really add up, and that haven’t been adequately explained. First, what was the original purpose of the money? Is it really true that the Saudi royal family gave the Prime Minister $781 million – to him, deposited in his personal bank account, not that of his political party – for no consideration whatsoever? I mean, I know the Saudi royals are obscenely rich, but it strains credulity that this was just a no-strings-attached political donation. The AG didn’t offer any further explanation that would make this story credible. Second, there’s that little matter of the $61 million that the Prime Minister did not return to the Saudis. That’s still quite a bit of money. Where did it go? What was it spent on? Is it really the case that political finance rules in Malaysia don’t have anything to say about accounting for such large political donations. And again, the fact that the AG didn’t say anything about this only fuels further suspicions.
- Oh, and continuing on that same theme: Is there really nothing illegal about the sitting head of the Malaysian government accepting a $781 million political donation from a foreign power (because, let’s not kid ourselves here, there’s not much distinction between the Saudi royal family and the government of the Kingdom of Saudi Arabia), and not have to make any disclosures or file any paperwork or anything? Really? That’s a bit to the side of the main point I’m trying to make here, but if that’s really the case, wow. Absurd.
What is that main point I’m trying to make? Simply this: In high profile anticorruption cases involving the head of state or other high-level politicians, it’s vitally important that the government maintain its credibility. When there’s been a lot of coverage and discussion of an alleged corruption scandal involving such senior figures, it’s only natural that many people will greet with suspicion any announcement by the government that no wrongdoing occurred. The best way to counter this suspicion is for the powerful people under investigation, and all state institutions involved, to be as transparent as possible, to take clear steps to signal that the investigation is impartial and that it has the full support of the powerful people under scrutiny. When this is not done, people have a right to be cynical and suspicious when the government investigators absolve those powerful figures.
So, call me cynical and suspicious, but I’ll put this bluntly: When Malaysian AG announced last week that Prime Minister Najib had engaged in no unlawful conduct in connection with the $781 million that ended up in his account, I don’t believe him. Maybe I’m wrong – again, all I know about the case is what I read in the papers. But if lots of people, like me, don’t believe that the evidence truly absolves the Prime Minister, he has nobody to blame but himself.
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Like many others, I share your skepticism. However, I was surprised when the BBC last week reported having a Saudi source who claimed the late King Abdullah authorized the payment (see here: http://www.bbc.com/news/world-asia-35409424, although a more doubting commentary was published the previous day: http://www.bbc.com/news/business-35407089). It seems reasonable to think that relatively moderate King Abdullah, with his campaigns against Muslim extremism ( http://www.cnn.com/2015/01/22/middleeast/saudi-arabia-king-abdullah-obit/) would have supported a powerful, long-lived but strongly Sunni leader as part of a worldwide campaign against Muslim extremism. Money would have been needed for the close race in 2013, along with the alleged cash payments that went into winning it (http://www.economist.com/news/asia/21577375-government-scrapes-homeallegedly-aided-vote-rigging-tawdry-victory). Despite rumors of previous discrimination against Shiites, Najib spoke last year at the UN about the need for Muslim solidarity (http://www.un.org/apps/news/story.asp?NewsID=52100#.VrKozinfg14) and apparently a piece of (controversial) anti-terrorism legislation was passed in Malaysia last year, though of course all of that may be unrelated to any influence from Saudi Arabia.
Despite the believable political connection, the claimed amounts are staggering and, as you point out, make no sense having gone to a personal account. Perhaps the resort to a far-fetched sounding explanation is some sort of indicator of how serious the situation is. On the other hand, perhaps it is plausible enough to placate some–if not all–of those who were vocal in opposition. To a Malaysian, ties with Saudi are close and friendly. King Abdullah visited Malaysia several times. Tourism to and from Malaysia is frequent. (Anecdotally, while living in Riyadh, a large number of my students and acquaintances vacationed in Malaysia, and on a flight from Riyadh to Singapore, the large majority of passengers were Malaysians returning from Umrah; see also http://www.arabnews.com/news/518756.) Even so, as you mention, maybe–one can hope–it will ruffle some feathers to think such a transaction would be legal, if indeed it happened as claimed.