Malaysia fines 80 people, companies in 1MDB case: anti-graft chief

Above, documents pertaining to the trial of former Malaysian Prime Minister Najib Razak over the 1MDB corruption allegations are brought to the High Court in Kuala Lumpur on August 28, 2019. (AFP)
Updated 07 October 2019

Malaysia fines 80 people, companies in 1MDB case: anti-graft chief

  • 1Malaysia Development Berhad (1MDB) was set up in 2009 by former Prime Minister Najib Razak
  • Najib, who lost a general election last year, faces dozens of graft and money laundering charges

KUALA LUMPUR: Malaysia has fined 80 individuals and entities for allegedly receiving money from state fund 1MDB, the country’s anti-graft chief said on Monday.
Malaysian and US investigators say about $4.5 billion was misappropriated from 1Malaysia Development Berhad (1MDB), set up in 2009 by former Prime Minister Najib Razak.
Najib, who lost a general election last year, is now facing dozens of graft and money laundering charges over allegations that he received about $1 billion in 1MDB funds. He has pleaded not guilty.
Latheefa Koya, the head of Malaysia’s Anti-Corruption Commission (MACC), told reporters the agency was aiming to recover 420 million ringgits ($100 million) from individuals and entities who had allegedly received funds laundered through accounts linked to Najib.
“We have issued compound notices against all of these people and entities for the purpose of them to pay up the fine,” Latheefa said, adding that they could be fined up to 2.5 times the amount received.
The individuals include Najib’s brother Nazir Razak, the former chairman of Malaysia’s second-largest bank, CIMB, and Shahrir Abdul Samad, former chairman of state palm oil agency Felda.
Funds were also distributed to companies, political parties and organizations linked to Najib’s coalition, a list provided by the MACC showed.
A spokeswoman for Nazir did not immediately respond to a request for comment. Shahrir declined to comment.
In 2015, Nazir went on a leave of absence after the Wall Street Journal reported that he received around $7 million from Najib and disbursed the funds to other politicians before elections in 2013.
An independent review into the money transfer concluded that Nazir did not misuse his position and there was no inappropriate use of the CIMB’s resources, following which Nazir resumed his duties as chairman. He resigned last year after three decades at the bank.
Nazir had received about 25.7 million ringgits in cheques, Latheefa said. She declined to confirm whether these were the same funds that Nazir had allegedly received in 2013.
After winning last year’s election, Prime Minister Mahathir Mohamad’s administration has reopened 1MDB probes, charged dozens of high-ranked officials, and filed civil forfeiture actions in a bid to recover money linked to 1MDB.
Since 2016, the US Department of Justice has filed forfeiture lawsuits on about $1.7 billion in assets allegedly bought with stolen 1MDB funds, including a private jet, luxury real estate and jewelry.
In May, the United States began returning to Malaysia some $200 million recovered from the sale of seized assets.


US debate on internet liability spills over to global trade deals

Updated 18 min 21 sec ago

US debate on internet liability spills over to global trade deals

  • Section 230 has become a proxy for the frustrations with Facebook and Google, says expert

WASHINGTON: US lawmakers seeking to rein in Big Tech have been stepping up efforts to limit legal immunity for online services, and now are taking that fight global.

House Speaker Nancy Pelosi this week backed a move by fellow lawmakers to carve out the so-called Section 230 protection — which some activists say is a cornerstone of the open internet — from a North American trade pact with Canada and Mexico, known as USMCA.

“There are concerns in the House about enshrining the increasingly controversial Section 230 liability shield in our trade agreements, particularly at a time when Congress is considering whether changes need to be made in US law,” Pelosi spokesman Henry Connelly said.

Debate on Section 230, a clause in the 1996 Communications Decency Act, has been raging for months amid rising concerns about the failure of tech platforms to curb hate speech, extremist content, copyright infringement and other abuses.

The effort to modify the law — which immunizes online services from third-party content on their sites — has drawn support from both Democrats and Republicans.

Republican Senator Josh Hawley proposed legislation earlier this year that would end the immunity unless companies submit to an “external audit” which shows they are acting in a “politically neutral” manner.

“With Section 230, tech companies get a sweetheart deal that no other industry enjoys: Complete exemption from traditional publisher liability in exchange for providing a forum free of political censorship,” Hawley said in introducing the legislation. “Unfortunately, and unsurprisingly, big tech has failed to hold up its end of the bargain.”

Civil liberties activists said Hawley’s bill is unconstitutional and would put the government in charge of regulating speech. Other analysts point out that Section 230 has enabled the internet to thrive and that modifying it could be devastating for the internet and online speech.

“The services that we enjoy the most exist because of Section 230,” said Eric Goldman, director of the High-Tech Law Institute at Santa Clara University.

Goldman said Section 230 has become a “proxy” for the frustrations with Facebook and Google but that “American consumers would be the losers” if the law is weakened.

Corynne McSherry of the Electronic Frontier Foundation told a congressional hearing in October that Section 230 protects not only major tech platforms, but any online activity — from forwarding an email to commenting in a news forum to sharing pictures and videos of friends — from “third party liability.”

McSherry said that without Section 230, tech firms such as Google, Facebook, and Twitter would not exist in their current form because they would not be able to host user content without fear of a lawsuit.

She argued that eliminating Section 230 would “cement the dominance” of these firms, because it would mean higher costs to filter and moderate content that new startups could not afford.

According to Katherine Oyama, Google’s head of intellectual property policy, the internet would be a far different experience without the liability shield.

“Without Section 230, platforms could face liability for decisions around removal of content from their platforms,” she told lawmakers.