Kuwait residents mask
Mask-clad residents walk in a neighbourhood of Kuwait City on May 12, 2020, as authorities allowed people to exercise for two hours under a nationwide lockdown due to the COVID-19 pandemic. Kuwait has said that COVID-19 would not prevent it from tackling corruption. Image Credit: AFP

Abu Dhabi: Kuwait’s Cabinet is reviewing media reports of alleged “direct or indirect” transactional links between Kuwait-based companies or government bodies, a Chinese company and the former Malaysian government on an overseas project “marred by suspicions of corruption,” Kuwait News Agency reported.

Prime Minister Sheikh Sabah Khaled Al-Hamad Al Sabah is committed to tackling all forms of corruption in compliance with the directives of Highness the Amir Shaikh Sabah Al Ahmad Al Jaber Al Sabah, government spokesperson Tariq Al Mezrem said.

The cabinet was briefed on the recommendations of its Legal Affairs committee regarding the affair, and its implications in line with laws on anti-money laundering and terrorist financing and financial disclosure.

It decided to entrust the State Audit Bureau with examining and reviewing the reports to clarify whether there was any embezzlement of public funds or undermining of the interests of any Kuwaiti government body in these transactions.

It also decided to refer the matter to relevant authorities, in case the allegations are proven true, to take necessary legal action.

The Kuwait Anti-Corruption Authority will also carry out its role, in examining the transactions and determining whether there were any corrupt criminal practices, taking legal action in this case.

Also, the Financial Investigation Unit will be tasked with carrying out what it deems necessary to obtain the necessary information from relevant authorities and state bodies to ascertain the presence of money laundering in the transactions, and refer the matter to the Public Prosecution.

Furthermore, the cabinet said it attaches great importance to the protection of public funds and is sincerely committed to a fully transparent approach in state body dealings and practices.

It explained that its ongoing multi-faceted efforts to confront the COVID-19 crisis will not distract it from combatting corruption and the misappropriation of public funds.

The government will also not hesitate to hold those found responsible for these acts into account.

Tale of corruption

The 1Malaysia Development Berhad scandal or 1MDB scandal is an ongoing political scandal in Malaysia. In 2015, Malaysia’s then-Prime Minister Najib Razak was accused of channelling over RM 2.67 billion ($700 million) from 1Malaysia Development Berhad (1MDB), a government-run strategic development company, to his personal bank accounts. The event triggered widespread criticism among Malaysians, with many calling for Najib Razak’s resignation – including Dr Mahathir Mohamad, one of Najib’s predecessors as Prime Minister, who eventually defeated Najib to return to power after the 2018 general election.

Political leader Anwar Ibrahim has openly questioned the credentials of 1MDB. He told Parliament that according to the records held by the companies commission, the company “has no business address and no appointed auditor.” According to its publicly filed accounts, 1MDB has nearly RM 42 billion ($11.73 billion) in debt. Some of this debt reportedly resulted from a $3 billion state-guaranteed 2013 bond issue led by Goldman Sachs, believed to have made as much as $300 million in fees from that deal alone, although it disputes this figure. Conference of Rulers in Malaysia has called for the investigations by the government to be completed as soon as possible, saying that the issue is causing a crisis of confidence in Malaysia.

After the 2018 election, the newly elected Prime Minister, Mahathir Mohamad, said there was enough evidence to reopen a probe into the 1MDB scandal. In the months after the election, Malaysian authorities barred Najib Razak from leaving the country, seized a huge haul of cash and valuable items from premises linked to him, and charged him with criminal breach of trust, money laundering and abuse of power.