A Malaysian parliamentary inquiry presented on Thursday said a state-owned fund linked to Prime Minister Najib Razak made more than $3 billion in unexplained overseas payments, calling for its former CEO to be investigated.

The report by the parliament's Public Accounts Committee (PAC) marked the first time an official Malaysian probe has suggested misconduct or recommended action over the scandal swirling around Najib.

Najib, who founded the state investment fund 1Malaysia Development Berhad (1MDB) in 2009, has battled for months to fend off allegations that billions of dollars were looted from 1MDB in complex overseas financial transactions.

He and 1MDB have consistently denied wrongdoing.

But the PAC said more than $3 billion in unapproved payments were made from 1MDB funds, and alleged "restrictions and weaknesses" in 1MDB's management.

"The PAC is of the opinion that the former CEO of 1MDB Shahrol Azral Ibrahim Halmi has to take responsibility for those restrictions and weaknesses," the 106-page report said.
"As such, enforcement agencies are asked to investigate Shahrol Azral Ibrahim Halmi and anyone else related."

Shahrol was 1MDB's CEO from 2009 to 2013.

The report did not make further recommendations on who should be investigated, nor did it allege misconduct by Najib.

Najib has faced a cascade of corruption allegations stemming from 1MDB's troubles and his own admitted acceptance of a mysterious $681 million overseas payment.

Swiss authorities have said as much as $4 billion may have been stolen from 1MDB.

Authorities in Switzerland, the United States, Singapore, Hong Kong and elsewhere are investigating.

Critics have alleged debt-stricken 1MDB, set up to fuel Malaysian development projects, was bled dry in a vast campaign of fraud and embezzlement stretching from the Middle East to the Caymans.

The Wall Street Journal, which has detailed many of the money movements, also last year revealed the $681 million payment made to Najib's bank accounts in 2013.

It has said in subsequent reports that he may have received more than $1 billion.

Najib has taken steps to scuttle official investigations, purge officials demanding accountability, and stifle media reporting on the scandals.

He initially denied taking the $681 million but his government now claims he accepted a "donation" from the Saudi royal family, most of which was given back.

Saudi Arabia is yet to confirm that explanation, which is widely dismissed in Malaysia as a cover story.

The Journal last week said documents show the same Najib bank accounts were used to purchase $15 million in luxury goods and pay out millions more to political figures ahead of 2013 elections.

The newspaper also reported that some of the money used to make Hollywood hit "The Wolf of Wall Street", a movie about financial corruption starring Leonardo DiCaprio, was laundered from 1MDB.