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Ex-Malaysia spies under probe for misappropriating S$16 million

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Eight, including spy agency chief, suspected of misappropriating about S$16 million in government funds

KUALA LUMPUR: A group of former agents from Malaysia's foreign intelligence agency, including its chief, are being investigated for alleged misappropriation of government funds, a senior Malaysian anti-graft official said yesterday.

The probe by the Malaysian Anti-Corruption Commission (MACC) is the latest in a widening crackdown by Prime Minister Mahathir Mohamad's government on corruption allegedly linked to the administration of his predecessor, Najib Razak.

Earlier this week, the MACC arrested eight former officers of the Malaysian External Intelligence Organisation (MEIO), including its former head Hasanah Abdul Hamid, on suspicion of misappropriating about US$12 million (S$16 million) in government funds.

"We are looking into possible abuse of power by the officers involved, and the misuse of funds, which we believe were government funds," MACC's deputy chief commissioner Azam Baki said at a press conference.

Investigators have seized about US$6.5 million in cash and valuables from various locations, including the MEIO's headquarters at the Prime Minister's Office in Putrajaya.

A Malaysian businessman with permanent residence status in Britain has also been detained, Mr Azam said, adding that investigators were still looking for the remainder of the funds, Reuters reported.

He said the authorities were still investigating the source of the funds, but did not rule out the possibility that the money was linked to billions of dollars allegedly stolen from Malaysian state fund 1Malaysia Development Berhad (1MDB).

"Yes, we are looking into that angle also," he said.

The money was believed to have been brought into Malaysia from another country, he said, declining to name the country.

The authorities in six countries, including Switzerland and the US, are investigating how billions of dollars went missing from 1MDB, founded by Najib in 2009.

The US Department of Justice has said more than US$4.5 billion was misappropriated from the fund, with some of the money used to buy a private jet, a superyacht, Picasso paintings, jewellery and real estate.

Najib has been charged with money laundering and corruption offences related to about US$10 million allegedly transferred into his bank account from a former unit of 1MDB.

He has pleaded not guilty to the charges.

Meanwhile, Hasanah has been remanded for five days, The Star reported.

Magistrate Shah Wira Abdul Halim allowed the MACC's application for Hasanah to be remanded until Sunday.

Her lawyer Shaharudin Ali said the MACC asked for the maximum seven days but was granted only five days by the magistrate.