Despite the probe into 1MDB in several countries, there is "no case" against it and all allegations involving it are part of a “political game”, Malaysian Ambassador to Indonesia Zahrain Mohamed Hashim said.
In an interview with country's top current affairs magazine, Tempo, Zahrain said the Malaysian government and its leaders were instead "victims" of the opposition's attempts to use the 1MDB issue to demonise the administration as the country heads towards the 14th general election.
"If there are allegations and reports, why is there no action? No arrest?
"There is no case. The police, MACC and the attorney-general have studied (the 1MDB case) and found there are no elements of fraud. It is the same case in the Parliament.
“There is no theft involved, no missing funds and no illegal flow of funds from 1MDB. 1MDB is formally still in business," he was quoted as saying.
Zahrain also said that it has been established that no money from 1MDB - started by the government to develop investment and business - had been channelled into Prime Minister Najib Abdul Razak's personal account, as alleged in a report by The Wall Street Journal.
The RM2.6 billion in Najib's account was instead a gift from a Saudi Arabian donor, he stressed.
Zahrain also questioned why US authorities did not liaise with their Malaysian counterparts if they were "sincere" in addressing the 1MDB issue.
The US Department of Justice (DOJ) had initiated a series of civil suits to recover funds it alleges was siphoned out of 1MDB through the American financial system.
The Malaysian envoy claimed that the probe into 1MDB by the US Federal Bureau of Investigation (FBI) was based on news reports and "stories".
"What surprises me is, if the FBI is accusing 1MDB of laundering money, why is 1MDB CEO (Arul Kanda Kandasamy) yet to be questioned? I believe this is a political game. There are parties who wish to demonise the Malaysian government and the prime minister.
According to Zahrain, the 1MDB issue "blew up" after the opposition colluded with whistleblower website Sarawak Report three years ago.
"Now it has become stronger because (former prime minister) Dr Mahathir (Mohamad) is involved with the opposition. He has strong connections."
The Malaysian government had refused to comment much about the 1MDB issue, he added, because "…we don't want to waste time denying stories which are untrue unless they are backed with strong evidence."
'Yacht not Jho Low's'
Zahrain also told the magazine that Najib was "angry" and "extremely disappointed" with news reports linking him to the seizure of superyacht Equanimity in Bali on Feb 28.
The US$250 million (RM1 billion) vessel, linked to Penang-born businessperson Low Taek Jho (Jho Low), is alleged to have been bought with funds siphoned from 1MDB.
To a question on how the Malaysian government took the news about the yacht's seizure, Zahrain said: "It is not a Malaysian vessel, it has nothing to do with Malaysia. Based on the information we received, it is not even Jho Low's."
Asked by the reporter as to who therefore owned the yacht, Zahrain replied: "You please investigate," adding that the Equanimity should not be linked to 1MDB, the Malaysian government or Najib.
Zahrain admitted that he had no knowledge about who Jho Low really was.
"I do not know much. Maybe he is a middleman, a broker. He does not work for the Malaysian government, the prime minister or 1MDB."
On Jho Low's whereabouts, Zahrain said: "No one knows, maybe he is going around the world. Until now I have not heard of Jho Low being arrested."
Zahrain also stressed that Jho Low was merely an acquaintance of Najib's stepson Riza Aziz and not Najib himself.
To a question on whether Najib knew Jho Low, he replied: "I do not know, maybe they have met. The prime minister is often linked (to 1MDB) even though he is not involved (in its administration)."