IBTimes UK

Malaysia's finance ministry has dissolved the board of advisors of 1Malaysia Development Berhad (1MDB) and taken over the state funds' remaining assets after a long-drawn scandal over transactions at the fund put the government in a spot.

The Parliament's Public Accounts Committee (PAC) had last month called for the 1MDB advisory board to be disbanded after an investigation into the fund, whose debt had totaled about 50 billion ringgit ($12.5 billion).

The opposition has called for the resignation of Prime Minister Najib Razak, who chairs the board of 1MDB, a pet project of the PM. The fund is now being investigated for money-laundering in at least six countries including the United States, Switzerland and Singapore.

The parliament committee has criticized the board for being irresponsible and said Najib, who is also the finance minister, was responsible for signing off on the fund's major transactions. However, Najib has denied any wrongdoing.

The ministry said in a statement the ownership in 1MDB's subsidiaries and four land assets would be transferred to it. But it didn't mention anything about the debts linked to the assets.

Last month, 1MDB's board members collectively resigned and it is reported that new members would be appointed to reflect the limited business profile of the board.

However, 1MDB president Arul Kanda will remain in his role until further notice, according to the statement.

"(Arul) will continue to focus on his specific mandate to implement the rationalization plan, which will include resolution of the recent contractual dispute with IPIC (International Petroleum Investment Co)," the ministry said.

IBTimes UK