Malaysian Investigators Freeze 1MDB-Linked Bank Accounts

(Bloomberg) -- Malaysian investigators have frozen bank accounts of people and entities that they allege could potentially be involved in embezzling money from state fund 1MDB.

The accounts include those of United Malays National Organisation, or UMNO, the biggest party in the coalition that lost power in elections last month, according to an emailed statement from the task force focused on a renewed 1MDB investigation. The task force said other political parties have also had their accounts frozen, without specifying.

“I will seek to prove that the funds owned by UMNO are legitimate and not involved in any illegal fund activities,” Ahmad Zahid Hamidi, UMNO’s acting president, said in a Facebook post. He took charge of the party after former premier Najib Razak stepped down in May.

Malaysian Investigators Freeze 1MDB-Linked Bank Accounts

Prime Minister Mahathir Mohamad is seeking to recover $4.5 billion of funds potentially lost through the state investment company whose full name is 1Malaysia Development Bhd. The police seized cash and objects valued at about 1.1 billion ringgit ($272 million) in several raids at sites linked to Najib, and plans to call in the former prime minister and his wife for questioning soon.

Najib has consistently denied wrongdoing and called the new probe “politically motivated.”

The task force, led by former Attorney-General Abdul Gani Patail, pledges a fair and professional investigation, according to the statement.

UMNO is set to hold polls to pick a new party president on Saturday, after Najib stepped down days after losing the general election, which ended the party’s six-decade rule. Ahmad Zahid is among those in the running, along with former Youth and Sports Minister Khairy Jamaluddin and former Finance Minister Tengku Razaleigh Hamzah.

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