KUALA LUMPUR (Reuters) - Malaysia's anti-graft agency had recommended that Prime Minister Najib Razak be charged with criminal misappropriation, a source said, amid growing outrage after the premier was cleared of any offences in a multi-million-dollar scandal.
The attorney-general on Tuesday closed all investigations of Najib, after reviewing reports from the Malaysian Anti-Corruption Commission (MACC) on a case that involved the transfer of $681 million into the prime minister's personal bank account.
Najib has consistently denied any wrongdoing, saying the funds were a political donation and he did not take any money for personal gain. After he was cleared of any offences by the country's chief law officer on Tuesday, he said the scandal had been "an unnecessary distraction".
A source at the MACC told Reuters that, when it handed its findings to the attorney-general last month, the agency had recommended that Najib be charged with criminal misappropriation. The source did not specify the grounds or the legal basis for the MACC's recommendation.
"It's a pretty straightforward case. We had made recommendations for charges to be filed that the attorney-general has instead chosen to reject," said the source, who declined to be identified or to elaborate on the MACC's findings.
The attorney-general's office declined to comment. Najib's office said it had no immediate comment.
The MACC said it would not comment on whether it made any recommendation to charge the prime minister.
In a statement on Wednesday, the agency said it would seek a review of the attorney general's decision to close the investigations, but declined to make any further public comment on his findings.
Najib has been buffeted for months by allegations of graft at the debt-laden state fund 1Malaysia Development Berhad (1MDB) and by revelations of the transfer of funds, adding to a sense of crisis in a country under economic duress from slumping oil prices and a sliding currency.
Attorney-General Mohamed Apandi Ali appeared to have drawn a line under the scandal on Tuesday, announcing that the money was a private donation from Saudi Arabia's royal family and that no further action needed to be taken on the matter.
While Malaysian law places limits on the amounts individual candidates can spend in an election campaign, there is no ceiling on donations to parties or requirement for them to disclose the source of their funds.
However, popular opinion seems to be against Najib as he tries to rebuild support ahead of a 2018 general election, and on Wednesday commentators and critics denounced the attorney-general's ruling as a whitewash.
"The court of public opinion will continue to try him," said veteran journalist and former editor-in-chief of the state-linked New Strait Times newspaper, A Kadir Jasin.
"As for all of us, we have to do some serious soul-searching if we care for this country and its future."
Najib's ruling United Malays National Organisation party welcomed the attorney-general's decision. Deputy Prime Minister Ahmad Zahid Hamidi said it had brought a moment for the country to unite and move forward under the prime minister's leadership.
Influential former Prime Minister Mahathir Mohamad, one of Najib's fiercest critics, said in a blog that having that much money in his account was wrong in itself, even though it might not be illegal.
Mahathir said the attorney-general's role as both judge and prosecutor amounted to an injustice.
Apandi's office did not comment on Mahathir's criticism.
Najib enjoys the backing of most of the powerful division chiefs in the ruling United Malays National Organisation party, and most of his critics concede that he cannot be unseated.
In moves that were widely seen as stamping out dissent last year, he sacked his critical deputy prime minister, replaced the former attorney-general with Apandi and cracked down on opposition leaders and academics. Najib has said his reshuffle was necessary to maintain government unity.
Human Right Watch (HRW) said in its World Report 2016 released on Wednesday that Malaysia's human rights situation had deteriorated sharply during 2015, as the government stepped up a campaign of harassment and repression.
The government rejected similar criticisms in an HRW report last October, saying it did not reflect the reality of life in Malaysia.
Editing by John Chalmers, Robert Birsel and Alex Richardson