Malaysia unveils five-year plan to fight corruption

Plan focuses on procurement, contracts and requires politicians to publicly declare their assets.

Malaysia has unveiled an ambitious five-year plan to clamp down on corruption in government, months after a multi-billion-dollar graft scandal brought down the previous administration.

The plan, launched by Prime Minister Mahathir Mohamad on Tuesday, would involve sweeping changes to the appointment process for key posts, require legislators and ministers to publicly declare their assets, and introduce new laws to regulate political funding and lobbying.

Voters rejected Mahathir’s predecessor Najib Razak in an election in May last year, amid widespread public disgust over allegations that about $4.5bn has been stolen from 1MDB, a state fund set up by the former prime minister.

Najib, his wife and several high-ranking officials of his former administration are now facing dozens of criminal charges related to 1MDB and other government entities. All of them have pleaded not guilty.

Mahathir said Malaysia requires “all kinds of strategies, laws and restrictions” to curb corruption.

“This plan is a strong statement from the current government that we will track down and prosecute past offenders, while current and future offenders will be facing harsher action,” the prime minister said in a speech to launch the new approach to fighting graft.

The plan’s measures would target the government’s procurement process, law enforcement, the judiciary, politics and business, he added.

1MDB case

Officials studied the 1MDB case closely to design the new anti-corruption plan, said Abu Kassim Mohamed, the director-general of the Governance, Integrity and Anti-Corruption Centre, which drafted the anti-graft measures.

“When you have a top leader of the country allegedly involved in misconduct on such a mega scale, that has an impact on the public,” Abu Kassim told Reuters news agency on Monday.

Authorities in Malaysia and the United States allege that Jho Low, a financier with ties to Najib’s family, diverted funds from 1MDB and that about $1bn of it was eventually deposited into Najib’s personal bank accounts.

In July last year, Malaysian police seized designer handbags, luxury watches, jewellery and cash estimated at $273m from high-end properties linked to the former prime minister. 

It took three days, six cash counting machines and 22 officials from the central bank to count the cash, the then head of Malaysia’s commercial crime division, Amar Singh, said at the time.

Both Najib and Low, who is being sought by police, have denied wrongdoing.

The Malaysian government has also filed criminal charges against the US investment bank Goldman Sachs over 1MDB.

Its anti-graft plan addresses high-risk practices such as the selling of government contracts to third parties, and the appointment of political operatives to the board of state-linked companies, Abu Kassim said.

It also aims to strengthen the independence of investigating bodies such as the audit department and the anti-corruption commission, he added.

Political financing

New rules on political funding could affect opposition parties, particularly the United Malays National Organisation (UMNO), the party Mahathir led until 2003. Najib was head of the party for almost a decade before last year’s election defeat.

Having controlled every ruling coalition since independence six decades ago, UMNO had established a system of patronage to ensure support from the country’s majority ethnic Malays.

UMNO and PAS, a Malay Islamist party also in opposition, reportedly received funds from 1MDB when Najib was in power.

Malaysia was ranked 62 out of 180 countries in the Corruption Perceptions Index published by Transparency International last year.