The fund, initially launched to foster economic development in Malaysia, has denied reports it is under investigation by authorities in the Alpine State.

Malaysia’s scandal-hit development fund, 1MDB, yesterday hit back at reports suggesting Swiss authorities had launched an investigation into its relationship with a Saudi Arabian oil producer. 

1MDB, an acronym of 1Malaysia Development Berhad, said in an emailed statement that “there is no suggestion of wrongdoing by 1MDB or any of its officials”, adding “it is irresponsible and reprehensible” for an “act” by Swiss investigators “to be twisted and framed as an inquiry”.

The statement read: “We wish to state in the strongest possible terms that 1MDB is not the subject of any criminal investigation either in Malaysia or internationally. We have and remain ready to assist the investigation of any lawful authority, in line with international protocols. Until today, 1MDB has not received any such request.”

The state-owned investment fund is at the epicentre of an alleged money laundering scandal that has led authorities globally to probe claims that billions of dollars were siphoned off by the fund’s officials and government figureheads.

According to a 2016 seizure order filed by the US Department of Justice (DoJ), 1MDB, under the pretence of investing around $1 billion in a joint venture with PetroSaudi, transferred some $700 million to an account unconnected to the firm.

Documents reportedly showed that around $700 million may have moved through government agencies and companies linked to 1MDB before hitting the personal bank accounts of Malaysia’s Prime Minister, Najib Razak. He claimed, however, that the money was a political donation from a Saudi royal family and that most of the sum was returned.

“1MDB asks all parties to refrain from politicising any alleged investigation by the Swiss authorities on non-Malaysian nationals, and, during this sensitive general election period, desist from trying to create links to 1MDB for political gain,” the fund’s latest statement read.

Carter-Ruck, PetroSaudi’s law firm, said in an email that PetroSaudi isn’t the subject of an investigation, that it’s cooperating with authorities, and that the probe is understood to be at a preliminary stage, according to Bloomberg.

“PetroSaudi denies any wrongdoing in connection with its joint venture with 1MDB and it rejects any claims that it, or any of its officials, are involved in the misappropriation of funds from 1MDB,” Carter-Ruck said.

Money laundering control failings involving illicit Malaysian funds have seen a number of banks punished, such as when the Monetary Authority of Singapore removed the banking licences of BSI and Falcon Private Bank about two years ago.