Advice to charge Malaysia PM 'rejected'

It's been revealed Malaysia's attorney-general rejected the anti-graft agency's recommendation that Prime Minister Najib Razak be charged with criminal misappropriation, over a multimillion-dollar scandal linked to the Saudi royal family.

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 $US681 million ($A971.12 million) into the prime minister's personal bank account.

But a source at the MACC told Reuters on Wednesday, when it handed its findings to the attorney-general last month, the agency had recommended Najib to be charged for criminal misappropriation.

"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 MACC's findings.

The attorney-general's office was not immediately available for comment.

MACC said in a statement it would seek a review of the decision and declined to make any further public comment on the attorney-general's 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 mysterious 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 gift from Saudi Arabia's royal family and that no further action needed to be taken on the matter.

Najib has denied any wrongdoing and said he did not take any money for personal gain.

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.