Image via NST

KUALA LUMPUR — Tun Mahathir Mohamad has attacked Singapore’s handling of alleged money-laundering linked to Malaysian state investment fund 1Malaysia Development Berhard (1MDB), accusing the Republic of not targeting those accused of siphoning off more than billions from the fund.

“Notice that the Government of Singapore is very reluctant to pinpoint the people involved in this corruption,” Dr Mahathir said in an interview with The Financial Times. “It affects Singapore’s reputation as a financial centre. It is not doing the right thing. The people who accepted the bribes are not the people who are laundering the money.”

1MDB is the subject of investigations in six countries. Last month, the United States’ Department of Justice (DOJ) filed a lawsuit to seize more than US$1 billion (S$1.35 billion) in assets bought with money it said was embezzled from the firm — by people close to Prime Minister Najib Razak, who has denied any wrongdoing and said that Malaysia takes good governance seriously and will fully cooperate with investigators.

A day after the DOJ lawsuit, Singaporean authorities announced that they had seized bank accounts and properties worth S$240 million in a probe on possible money laundering linked to 1MDB.

The assets belonged to Malaysian financier Jho Low, alleged by US prosecutors to have played a central role in the operations of 1MDB, and his family.

The Monetary Authority of Singapore has vowed to fix lapses in the financial sector with tougher controls and industry supervision and is creating a dedicated money-laundering unit, after taking the rare step of ordering the closure of a Swiss bank’s branch in Singapore earlier this year.

“Appropriate actions will be taken against those who have broken Singapore’s laws,” FT quoted a spokesperson for the Singapore attorney-general as saying. “As investigations are still ongoing, we are not able to comment any further.”

Dr Mahathir, a former mentor turned critic of Mr Najib, recently announced that he was launching a political party that aims to be a rallying point for disaffected members of the ruling United Malays National Organisation.

“It is quite obvious that the party that is being led by Najib is being used by Najib to cover up,” Dr Mahathir told FT. “The FBI (US Federal Bureau of Investigation) and DoJ have exposed the wrongdoing.”

He added in the interview that the primary goal of his new party was “to get rid of Najib”. “For that purpose it will work together with other opposition parties, on this issue alone.”

Malaysia’s Communications and Multimedia Minister Salleh Said Keruak recently claimed that Dr Mahathir’s allies were behind the US’ lawsuit, an accusation Dr Mahathir denied on Monday (Aug 1).

“I didn’t make any such report,” he wrote in his blog.