May 10, 2018 / 1:08 PM / in 6 months

Malaysia's Najib goes quietly, sunk by scandal

KUALA LUMPUR (Reuters) - In the end, Najib Razak gave up without a fuss, the first prime minister of Malaysia ever to lose a general election.

Malaysia's outgoing Prime Minister Najib Razak speaks at a news conference following the general election in Kuala Lumpur, Malaysia, May 10, 2018. REUTERS/Athit Perawongmetha

After a bruising campaign in which he traded barbs and insults with his former mentor, Mahathir Mohamad, Najib’s Barisan Nasional coalition was trounced in Wednesday’s poll.

“Of course there will be a change,” the 64-year-old said while conceding defeat at a news conference on Thursday, his voice catching with emotion. “My friends and I are fortunate to have led the country this far.”

Najib is the son of Malaysia’s second prime minister and a nephew of the third. He himself was the sixth leader of the Southeast Asian nation since it gained independence from Britain six decades ago.

An England-trained economist with a penchant for well-tailored suits and pocket squares, Najib may however be remembered most for a multi-billion-dollar scandal at Malaysia’s state fund 1Malaysia Development Berhad (1MDB).

News broke in 2015 that about $700 million allegedly stolen from 1MDB had made its way into his personal bank accounts. He has denied any wrongdoing and has been cleared by Malaysia’s attorney-general even as U.S. authorities allege that over $4.5 billion was stolen from the fund in a fraud orchestrated by a financier known to be close to Najib and his family.

U.S. Attorney-General Jeff Sessions called the 1MDB scandal “kleptocracy at its worst” and the fund is the subject of money-laundering investigations in at least six countries, including Switzerland, Singapore and the United States.

Filings by the U.S. Justice Department in a civil lawsuit indicated nearly $30 million of the money stolen was used to buy jewellery for the prime minister’s wife, Rosmah, including a rare 22-carat pink diamond set in a necklace.

Other assets bought with the misappropriated funds included a Picasso painting that was given to actor Leonardo DiCaprio and the rights to two Hollywood films.

The scale of the scandal, and other corruption linked to Najib, was a major factor in his defeat, political analysts said.

    “The 1MDB expose coincided with the introduction of a new consumption tax by Najib, which weighed on the public,” said Adib Zalkapli, a Kuala Lumpur-based analyst with risk consultancy Vriens & Partners. “The opposition successfully sold the narrative to people that the consumption tax was a result of abuse of public funds by Najib.”

GOLF BUDDY

Najib chaired 1MDB’s advisory board until 2016.

Despite the investigations in the United States, he maintained ties with U.S. President Donald Trump and was invited to the White House last September.

Najib has talked to the local media about playing golf with Trump in the past, and said he had a picture of the two with Trump signing off on it saying “To my favourite Prime Minister”.

Now a grey-haired father of five, Najib was groomed for high office from an early age. He was elected to parliament at 22 and within two years had become the country’s youngest-ever deputy minister.

Accusations of graft had swirled around him long before the 1MDB affair. Opposition politicians said corruption was involved in the 2002 purchase of two French submarines while Najib was defence minister. Najib denied the allegations and there has been no evidence linking him to corruption in the deal.

Two of Najib’s bodyguards were convicted of the 2006 murder of a female Mongolian interpreter and model. One of Najib’s political aides, who was involved in negotiating the submarine deal, was also charged over the murder but was later acquitted.

Allies say Najib is a mild-mannered gentleman with a wry sense of humour who loves golf and his cats. His detractors say he was an authoritarian leader bent on stifling dissent to stay in power.

Last month, he introduced an anti-fake news law that set out fines of up to 500,000 ringgit ($123,000) and a maximum six years in jail. He denied charges by opponents that it was an attempt to stifle dissent.

As results came in on Wednesday night that Barisan Nasional was losing the election, rumours swept the Malaysian capital that Najib would somehow try to stay in power.

Malaysia's outgoing Prime Minister Najib Razak leaves after a news conference following the general election in Kuala Lumpur, Malaysia, May 10, 2018. REUTERS/Athit Perawongmetha

“There were claims that we held a meeting of the national security council at 10 p.m. to declare an emergency,” he told reporters on Thursday. “That is an example of one of the lies told.”

Mahathir, also accused of being an autocrat who crushed dissent during his 22 years in power, said he would investigate the 1MDB scandal but would not be looking for a scapegoat.

“We are not seeking revenge,” Mahathir said. “What we want is to restore the rule of law ... if the law says that Najib has done something wrong, then he will have to face the consequences.”

Additional reporting by Rozanna Latiff; Writing by Raju Gopalakrishnan; Editing by John Chalmers

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