Malaysian PM Najib used state funds for ‘bribery’, says former leader Mahathir

Oliver Holmes and David Munk in Kuala Lumpur
23 October 2015

Mahathir Mohamad launches fresh attack on scandal-hit former ally in interview with the Guardian

Malaysia’s former prime minister Mahathir Mohamad has accused his protégé and current premier Najib Razak of driving a debt-ridden state fund into the ground by using it for bribery.

In an interview with the Guardian at his office in the administrative capital Putrajaya, Mahathir said Najib had confided to him months ago that “cash is king”, during a terse meeting in which Mahathir told the man he once groomed for the country’s top post that he had lost his support.

“What he is telling me is that bribery is OK. If you bribe with a few dollars, I suppose it doesn’t work, but if you give [money] to a person who has never seen a million ringgit he will turn around,” he said, referring to the local currency.

Najib is battling for his political life after media reports said investigators had found that nearly $700m (£456m) linked to the troubled 1Malaysia Development Bhd (1MDB) state fund was transferred into the prime minister’s private bank accounts.

Mahathir, who ruled Malaysia for 22 years from 1981 to 2003, said in a one-hour interview that Najib had been struggling to fund cash handouts for support, in patronage to politicians as well as an overt programme of cash payments to low-income homes.

“That is not the way to win support, that is bribery. When you need money, you have to find money. You don’t have all that kind of money.

“So how do you raise money? That is the beginning of corruption. 1MBD was created so they can borrow huge sums of money,” he said.

“He needs a lot of money because he doles out money by the millions according to his own supporters. That is corruption. If you want to be popular, do a good job, you will be popular. But to buy people, it’s something morally degrading.”

Mahathir, 90, won five consecutive elections during a period in which the country saw rapid economic growth under the dominance of a single party, the United Malays National Organisation (UMNO).

He left a mixed legacy, accused by rights groups of becoming more authoritarian when he closed newspapers and arrested opposition activists and political opponents during his time in office.

Retiring in 2003, Mahathir remains one the most influential people in Malaysian politics.

“We find that the money that was borrowed for 1MBD is not traceable. There are officers of 1MBD who resigned because the money was not properly used, but they cannot talk because they are still government servants,” Mahathir told the Guardian.

“I told [Najib] that when you borrow the money, it is not sovereign wealth, it is borrowed money. You can’t do it like this.”

The former leader was seen to have handpicked his successors, Abdullah Badawi and Najib, both of whom he later turned on.

While Badawi was accused of poor economic management, Najib has received more personal vitriol from Mahathir.

“The only thing that we can do is to have the prime minister resign or step down or be removed. Because he is the principal person who has brought about this bad image for the country,” he said.

On his popular blog, Mahathir has alleged that politicians close to Najib who have “documentary evidence” of misconduct “now gladly support him”. During the interview with the Guardian, he said that some Malaysian bloggers are also being paid or persuaded to toe the line.

“Those bloggers who somehow suddenly switched over to supporting him, people who used to complain, to complain a lot … What he says is quite true, ‘cash is king’.

“He has a group of young people who seem to be advising him. Some of them are good but some think they can use his authority to enrich themselves.”

Mahathir has led calls for a vote of no confidence in Najib, although opposition politicians say a successful vote is unlikely while the leader enjoys a majority in parliament.

Malaysian police are currently investigating Mahathir on potential defamation charges, but is is not clear who filed the reports or to what they relate.

The fight among Malaysia’s political elite has stunned the country of 30 million, one of the most developed economies in south-east Asia but struggling with a devalued currency.

While Najib has consistently dismissed allegations of corruption and denied buying political support, he has also cracked down on his foes. He has sacked four ministers, his attorney general and deputy prime minister. Two newspapers were closed down this summer and rights activists warn of a growing culture of fear.

The Malaysian Anti-Corruption Commission (MACC) said the money deposited in Najib’s account was not from 1MBD but came from unidentified “donors who originated from the Middle East”.

The “donation has no connection at all to 1MDB”, the anti-graft commission said in the statement.

The prime minister’s office did not immediately respond to Guardian requests for comment.

Mahathir has called for the money to be traced, saying he doubted the cash was a donation as he had never been able to acquire funds from Arab donors during his tenure.

“He said he got the money from the Arabs. Well, show. If it is legitimate, why are you hiding it? Bring the Arab, we’ll find out how rich is he, what is his business before we can believe that he was given 2.6bn ringgit, US$700m, by a donor. How can you believe that?” he said.

“I’ve asked money from the Arabs for some university. I got nothing. I was prime minister.”

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