Malaysia drops 1MDB-linked charges against ex-PM Najib, former treasury official

By Rozanna Latiff and Danial Azhar

A Malaysian court on Wednesday allowed corruption charges linked to the multibillion-dollar 1MDB scandal filed against jailed former Prime Minister Najib Razak and the former treasury chief to be dropped, their lawyers said.

Najib faces several trials linked to the scandal at state fund 1Malaysia Development Berhad (1MDB), from which Malaysian and U.S. authorities say about $4.5 billion was stolen in a complex, globe-spanning scheme between 2009 and 2014.

Najib, who helped found 1MDB when he was premier in 2009, was found guilty of corruption and money laundering in a case linked to the scandal and sentenced to 12 years in prison in 2022, though the term was later halved by a pardon's board chaired by Malaysia's king.

He last month apologised for his role in mishandling the 1MDB scandal, though he maintained he had no knowledge of any illegal transfers from the state fund.

Najib and former treasury secretary-general Irwan Serigar Abdullah had been charged in 2018 with six counts of criminal breach of trust involving government funds worth 6.6 billion ringgit ($1.48 billion), which officials have said were related to a settlement agreement between 1MDB and Abu Dhabi state fund International Petroleum Investment Company.

The pair consistently denied wrongdoing.

The Kuala Lumpur High Court granted their bid for a discharge not amounting to an acquittal, due to procedural delays and the failure of the prosecution to disclose key documents, their lawyers said.

"The court correctly exercised its jurisdiction to discharge our client of the charges, consonant with the law," Najib's lawyer Muhammad Farhan Muhammad Shafee said in a text message.

The decision is likely to prompt further questions over the remaining cases against Najib, after prosecutors last year did not appeal his acquittal in a separate 1MDB-related case.

That came amid accusations that current Prime Minister Anwar Ibrahim, who was voted in two years ago on an anti-corruption platform, is backsliding on promised reforms. Anwar has said he remains committed to tackling graft but does not interfere in court cases.

Najib has also been pushing to serve the remainder of his sentence under house arrest, and has filed a case to compel the government to confirm the existence of a royal order that he says would allow him to do so.

Anwar's government said last month it would introduce a law allowing house arrest for some offences next year, though it denied that was aimed at getting Najib or other politicians accused of corruption out of jail.