There has been understandable dismay in anti-corruption quarters over the decision this week to continue to release US$300 million (RM1.3 billion) accrued from the sale of 1MDB assets to an unconfirmed backdoor government, in which the key players are the very kleptocrats who stole the money.

The money had originally been scheduled to be formally returned to the PH government in an official ceremony planned for 19th February, which was due to be attended in KL by several dignities including then Finance Minister Guan Eng, then Attorney General Tommy Thomas and the US Ambassador, Kamala Shirin Lakhdhir.

This was after months of cooperation between the two countries and in the light of change of government at GE14, which meant those responsible for the gross theft of billions from the Malaysian people were no longer in power and the crime was being prosecuted through the courts.

As Sarawak Report previously reported, the rules governing the US Kleptocracy Asset Recovery Unit specify that retrieved funds must not be returned to the same governments that stole the money, but rather held in trust. As one US law enforcement source told Sarawak Report:

“It would be like returning money to the bank robber after you have solved the theft instead of punishing him”

Malaysian insiders have confirmed to Sarawak Report that the February transfer was delayed at the last minute owing to a technical delay in organising the transfer of the monies.

Sarawak Report speculated just after the subsequent coup that there would now be an inevitable hold on the return of the cash, in that the new and unconfirmed backdoor government, created thanks to defections from PH by Azmin Ali and Muhyiddin Yassin, meant that the ‘bank robbers’ were indeed back in charge as the powers behind the throne.

Former prime minister, Najib Razak, and his former deputy and present leader of UMNO, Zahid Hamidi, were both facing scores of charges for kleptocracy and they both hold extremely powerful positions propping up the Muhyiddin government as the drivers of the largest party in the coalition.

The Agong appointed Muhyiddin, despite him having received no votes from MPs. These had overwhelmingly signalled their support for the PH leaders (Anwar Ibrahim followed by Dr Mahathir) in an informal sounding initiated by the palace. Parliament has been suspended by the backdoor government, meaning there is no evidence the new coalition holds a majority of seats – in fact the deposed Dr Mahathir has demonstrated he still has the majority of MPs.

Intervention by the US Ambassador?

As a result, many have expressed mystification as to why the money was released.

Sarawak Report has received reliable information that the decision owes to a call made by ‘PM8’ Muhyiddin to the US Ambassador, who happened to be in Washington as the Covid 19 lockdown came into effect. “The ‘PM8’ begged her to arrange the money” once source told Sarawak Report, “it is not often an Ambassador gets a private call from the PM of the country they are in asking for that sort of favour, maybe it seems good for her career”.

That Malaysian source is clearly bitter that months of hard work on the part of the PH government officials has ended up with a large sum of money disappearing into the proven, unreliable hands of a group of politicians with kleptocrat credentials longer than just about anywhere on the planet.

However, if the US Ambassador did advocate on behalf of the unconfirmed coup coalition dominated by UMNO, the question arises as to why?  Even if she denies she advocated for the release, why did she not openly oppose it under the circumstances of the sudden change of government?

The quest for good relations with Malaysia might clearly signal one reason for the move. After all, the deposed Dr Mahathir, who is known for his attacks on foreign leaders, has been characteristically less than polite about the notoriously sensitive current US President, to whom by contrast Najib had grovelled, promising invest Malaysian public money into the US economy.

Separate sources have told Sarawak Report that the US Ambassador expressed a high regard for Najib Razak when prime minister and had originally treated the 1MDB investigations as something of an inconvenience to the frustration of officers on the case. Subsequent to GE14 she has been open about predictions that the PH government would fall.

Sarawak Report has placed a request for a comment with the embassy in KL. Meanwhile, insiders from the US justice and enforcement services are said to be dismayed at any prospect that diplomatic or any other pressures may have played a part in undermining the strict policies of the Kleptocracy Asset Recovery Unit. According to one:

“Their attitude is to investigate crime wherever that leads regardless of the political and diplomatic repercussions. I am sure there are a lot of people who put a huge amount of time into this investigation who are going to be extremely unhappy about the money being returned back to the regime of kleptocrats that stole it”.

There has certainly been a long history of confirmed lobbying by UMNO players in Malaysia associated with 1MDB. Among the most recent influencers to be exposed were the Trump associate and key Republican fundraiser, Elliot Broidy, together with the lobbyist Rick Gates, who received multi-million dollar contracts from Najib in return for promising to influence the DOJ into dropping the investigations into 1MDB.

Boidy’s wife, a West Coast lawyer, likewise signed up to a multi-million dollar performance fee if she could use her ‘skills’ to get charges dropped against Jho Low and a Department of Justice official was sacked and prosecuted for taking bribes along with the rap star Pras Michael. Money was also passed previously to actors close to Obama who funnelled 1MDB cash into democrat election campaigns.

It is therefore likely that the story behind the twisting of procedures to release US$300 million into Muhyiddin’s hands, no strings attached (Muhyiddin was Najib’s Deputy PM at the time the money was stolen) may be complex and multi-faceted. However, it is unlikely to cast much glory on those involved.

Sarawak Report will update on any further responses on this matter.