Switzerland widens probe into murky Malaysia fund

Switzerland said today that it has widened its corruption probe into a Malaysia state-owned fund linked to Prime Minister Najib Razak, with two new individuals indicted over a suspected phony bond deal.
The Swiss attorney general's office (OAG) said the new suspects -- who are accused of fraud, bribery and other offences -- are two United Arab Emirates (UAE) officials who were in charge of sovereign funds based in Abu Dhabi.
In a statement, the OAG said it had evidence that the management of 1Malaysia Development Berhad (1MDB) violated Swiss embezzlement laws through a fraudulent bond agreement with the UAE officials, with money routed through Swiss banks.

Allegations that billions were looted from 1MDB in a vast campaign of fraud have shaken Najib's government.
The scandal intensified last week when a Malaysian parliamentary committee clearly suggested misconduct had occurred, in the first condemnation from an official body in Kuala Lumpur.
Switzerland opened its own criminal probe into 1MDB last August, targeting two former Malaysian officials "and persons unknown" on suspicion of bribery, money laundering and other offences.

The OAG has said that up to $4.0 billion (3.5 billion euros) of public funds in Malaysia may have been misappropriated, with a portion of the money transferred to Swiss accounts controlled by former Malaysian officials and people based in the UAE.

Concerning the latest allegations, Swiss authorities are scrutinising bonds issued by 1MDB subsidiaries officially intended to finance electric power plant projects in Malaysia.
The OAG statement said that sovereign funds based in Abu Dhabi issued guarantees on the bonds, but that evidence indicated 1MDB subsidiaries did not make proper payments in exchange for those guarantees.