Singapore Seizes Accounts Linked To 1MDB Malaysian Fund Controversy

Authorities in Singapore say they have seized a "large number" of bank accounts that various media have linked to a Malaysian government-run fund that stirred controversy around Prime Minister Najib Razak. While Singaporean authorities didn't confirm the link, according to The Straits Times, the move comes days after Switzerland said it would submit evidence of illegal transactions to Malaysian authorities, asking them to help pursue the investigation.

"Singapore does not tolerate the use of its financial system as a refuge or conduit for illicit funds," the Monetary Authority of Singapore (MAS) and the Commerce Affairs Department (CAD) said in a joint statement, as reported by The Straits Times. They added that they have been investigating possible offenses since mid-2015 and continue to get information from various institutions and individuals.

They said they are working closely with Malaysian, Swiss and American investigators.

Najib organized 1 Malaysia Development Berhad (1MBD) soon after taking office in 2009 to fund infrastructure among other projects and remains the chairman of its advisory board. The fund is now $11 billion in debt and is now selling assets to deal with a cash crunch. After months of speculation that the $680 million deposited in Najib's bank accounts had come from 1MDB, Malaysia's attorney general said last week it was a legal donation from Saudi royals. In July, a previous attorney general who linked the the money in Najib's account to 1MDB and was replaced.

The developments come just before Najib and other Southeast Asian leaders hold a special summit with U.S. President Barack Obama in California this month. Obama is strengthening ties with the region to help counter China's growing assertiveness in the South China Sea and to tap the region's large and fast-growing economies. Meanwhile, the Islamic State group (ISIS) made its presence felt in the region with a deadly bombing in Jakarta last month.

Najib plays a key role as the leader of the region's richest economy, as Malaysia's per capita income follows those of oil-rich Brunei and city-state Singapore, while its GDP follows Indonesia and Thailand. Malaysia has also played a key role in the Philippines' talks to end Muslim insurgency.