Former Malaysian Prime Minister Najib to face two key court rulings in $538 million saga

KUALA LUMPUR — Malaysia’s former Prime Minister Najib Razak, who is serving a prison sentence for corruption linked to the multibillion-dollar 1Malaysia Development Berhad (1MDB) scandal, will learn on Monday whether he can serve the remainder of his sentence under house arrest. The ruling will be the first of two court decisions this week that could test Prime Minister Anwar Ibrahim’s anti-corruption credentials.

Najib has been imprisoned since 2022 after being convicted of graft and money laundering. His original 12-year jail sentence was halved last year by a pardons board chaired by the country’s former king.

However, Najib has maintained that the monarch also issued an “addendum order” allowing him to serve his reduced sentence at home. He has sought a court order compelling the government to confirm the document’s existence and implement its terms.

For months, government officials denied knowledge of the addendum, but earlier this year the former king’s office and a federal lawyer confirmed that the royal document had indeed been issued.

The Kuala Lumpur High Court is expected to rule on Najib’s application on Monday, just four days before it delivers a verdict in the largest remaining 1MDB trial against him. Najib co-founded the state investment fund in 2009.

Analysts said a decision in Najib’s favor could spark public backlash, particularly among supporters of Anwar, who came to power in 2022 on a strong anti-corruption platform.

“It’s a test of the prosecution, it’s a test of the judiciary, it’s a test of political will,” said Bridget Welsh of the University of Nottingham Asia.

Anwar has faced growing scrutiny over his commitment to reform after prosecutors dropped several charges against Najib. Earlier this month, prosecutors also withdrew an appeal against the acquittal of Najib’s wife, Rosmah Mansor, in a separate corruption case.

While Anwar has repeatedly said he does not interfere in court proceedings, critics note that Malaysia’s attorneys general are appointed by the prime minister, raising longstanding concerns over their independence.

Najib Faces Additional Jail Time

Malaysian and U.S. investigators have said that at least $4.5 billion was misappropriated from 1MDB between 2009 and 2014, with more than $1 billion allegedly funneled into bank accounts linked to Najib.

Najib was convicted in 2020 for receiving funds from a 1MDB unit and was sentenced to prison two years later after exhausting all legal appeals, becoming the first former Malaysian prime minister to be jailed.

After losing power in 2018, Najib apologized last year for mishandling the 1MDB scandal but has continued to deny wrongdoing. He has said he was misled about the source of the funds by fugitive financier Low Taek Jho, also known as Jho Low, and other 1MDB officials.

On December 26, the court will also rule on whether Najib is guilty of four additional corruption charges and 21 counts of money laundering related to the alleged illegal transfer of about 2.2 billion ringgit ($538.69 million) from 1MDB.

If convicted, Najib could face up to 20 years in prison for each charge, along with fines of up to five times the value of the alleged misappropriated funds.

Najib’s lawyer, Muhammad Shafee Abdullah, said last week that the house arrest decision would not affect the outcome of the 1MDB trial, although he expressed hope for favorable rulings in both cases.

“We hope Monday is a good decision for us, and we hope that the decision on the 26th likewise will be a good one,” he told reporters.

($1 = 4.0840 ringgit) -Reporting by Rozanna Latiff; Editing by David Stanway/Reuters