Op-Ed by Amelia Cole
In the Summer of 2016, the United States Department of Justice filed law suits related to the 1Malaysia Development Berhad (1MDB) scandal, where money laundering and fraud implicated the highest levels of Malaysian politics and business. Among those tied to 1MDB was Jho Taek Low, a Malaysian-Chinese finance wiz who gained notoriety for being in the spotlight with American celebrities like Paris Hilton.
What interested US authorities was that Goldman Sachs appeared to be at the centre of the scandal – with the crony capitalist investment bank having raised funds for misuse by former Malaysian Prime Minister Najib Razak. This was the main story, but when Najib Razak lost power, largely due to the aggressive and Anti-Chinese election campaign of current Prime Minister Mahathir Mohamad, 1MDB was morphed into a racial issue. Jho Taek Low and the Low Family became the major target of populist and jingoistic rhetoric spewed from Malaysia’s current political leadership.
With Mahathir in power, Jho Low was quickly created into a scapegoat and the target of racist rhetoric. 1MDB became all about one man, and less the realities of crony capitalism, neoliberal finance networks, and the well-established predatory tactics of New York investment bank Goldman Sachs. An alleged manhunt sought to bring Jho Low back to Malaysia, to stand trial in place of US-finance.
Some hope is now emerging from this story. The Department of Justice and Jho Low have come to terms on a comprehensive global settlement, where Jho Low has led US authorities to recouping close to $1billion worth of funds, while the US Government is acknowledging the limited role of Jho Low in the affair, with no wrongdoing on the part of the Low Family.
Further, much of the $1billion may become accessible by the Malaysian government, and the positive cooperation between Jho Low and the US may force Goldman Sachs into being held accountable. That the 1MDB affair has been regularly cited to have involved over $4billion is an indication as to the disproportionate role played by US finance in the scandal.
Given these developments, the Malaysian government and Prime Minister Mahathir must prioritize their moves going forward. Kuala Lumpur has been obsessed with bringing Jho Low back for a show-trial, so much so that in August 2019 Jho Low was offered asylum under the Universal Declaration of Human Rights and European Convention on Human Rights as a result of politicized actions and human rights abuses on the part of the Malaysian government.
To repatriate money held by US finance, to seek justice against Western crony capitalism embodied in Goldman Sachs, Prime Minister Mahathir must look at cooperating with Jho Low. While persecution of the Low Family might satisfy populist and nationalist agitators in Malaysia, the interest of the country ultimately lies in maximizing the return of what US finance orchestrated against the country. Mahathir must lead the country in that direction.
Amelia Cole is a graduate student enrolled in the Economics department in Birmingham University.
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