Power, Najib’s Money and Malaysia’s Corrupt System

Once a month, each of the 191 loyal district chiefs that make up the hierarchy of the United Malays National Organization receives RM50,000 for “expenses.” It doesn’t come from Malaysia’s fiscal budget. It comes from Prime Minister Najib Razak’s personal accounts at Ambank in KL. Multiplied out, that totals RM114.6 million annually (US$27.498 million).

It is a system that has sustained party loyalty through several premiers for 35 years, if Najib is to be believed, and it points to the deep, long-running corruption of the entire Malaysian political system. It is just part of what keeps Najib in power against the combined investigations of five countries on allegations of money laundering, fraud and bribery. In his own country, accusations of corruption have been swept away with firings, censorship and brute power. Powerful, unknown individuals are believed to have been involved in the murders of Mongolian jet-setter Altantuya Shaariibuu, banker Hussain Najadi and graft watchdog Kevin Morais. Investigations have all been stalled.

In the spotlight

As the international spotlight falls on Najib and the mire that surrounds him, the price of loyalty may be rising. Copies of charges developed by the Malaysian Anti-Corruption Commission against Najib are said to have circulated widely among UMNO leaders despite efforts by his hand-picked Attorney General Mohamed Apandi Ali to keep them bottled up. They are said to provide copious opportunities for blackmail.

But if the premier is nervous, he isn’t showing it. He journeyed to the United States last month to meet with President Barack Obama and the leaders of the Association of Southeast Asian Nations, and he now is in Saudi Arabia, meeting with government leaders there –he was photographed at a Muslim religious cleansing ceremony with his wife Rosmah Mansor.

Last August, Najib told an UMNO division meeting that the same river of money that buys their loyalty flowed from Abdullah Ahmad Badawi when he was prime minister, and that he had never questioned where it came from, nor had Badawi done during the 22 years when Mahathir Mohamad was premier.

“I never asked him about political funding for the party all those six years I was his deputy. How he got the money, who gave the money were all under his discretion,” he was quoted in Malaysian Insider. “We never discussed such matters in the party supreme council, let alone openly. We only wanted to know that things were going properly all the way to the elections.”

The division chiefs – now one less with the departure Monday of Najib’s sharpest critic Mahathir from the party – are the iron wall that protects Najib. So far, only a tiny handful of members are willing to risk their own ouster from the party by breaking ranks.

Another one bites the dust

One may be Muhyiddin Yassin, the former deputy prime minister fired by Najib last July after he questioned the infamous US$681 million that mysteriously ended up in Najib’s accounts. Muhyiddin has said he will hold a press conference on Thursday, March 3, possibly to announce that he too is quitting the party. Muhyiddin was also ousted this week from his position as deputy party president after he announced that fired Attorney General Abdul Gani had shown him criminal evidence pertaining to Najib’s bank accounts.

There are more funds. Shahrir Samad, the leader of the parliament’s backbench club, received RM1 million from Najib after the 2013 election, according to documents passed to Clare Rewcastle Brown, the editor and publisher of Sarawak Report. Deputy Finance Minister Ahman Maslan was paid RM2 million. It is money that not only appears at election time, to pay for lunches or constituents’ leaking tin roofs in the kampungs, but pays wages between elections for the privileged leaders.

Other payments are made through various government agencies including the Village Security and Development Committee, to which the cadres are appointed. They are also appointed to four propaganda agencies under the Ministry of Information, Communications and Culture, which have offices in each of Malaysia’s 13 states and three federal territories. The bulk of the money to support these propaganda bureaus comes from the 1MDB Foundation, from which more than RM1 billion was siphoned off, purportedly for charity work, a well-placed source told Asia Sentinel.

In addition there are dozens of small contracts for rent-seekers. At least 23 companies, some of the country’s biggest, have been secretly owned by UMNO or passed on to such vehicles as Tabung Haji, the Muslim pilgrims’ funds; Khazanah Nasional, the national investment fund; Petronas, the national energy company; and others where make-work jobs and contracts or subcontracts help to feed UMNO.

Money politics is hardly new in Malaysia but Najib is a master of it. He was the country’s longest-serving minister of defense, first from 1991 to 1995, then from 2000 to 2008 before he became prime minister. As defense minister, he oversaw the modernization of the country’s military to the tune of billions of dollars. Three contracts in particular stand out. One was for the purchase of navy patrol boats, a second for Russian Sukhoi jet fighters and the third was the notorious purchase of Scorpene submarines, the deal the slain Mongolian woman is linked to. Together, those contracts are said to have produced at least US$300 million for UMNO cronies and others, in addition to whatever may rubbed off on Najib himself.