Australian Police Raid Homes Amid Malaysia Graft Allegations

Australian police raided properties across Melbourne on Thursday as part of an investigation into foreign bribery that local media said involved Malaysian officials laundering money through a property deal.

Officers carried out search warrants in the city center and suburbs, the Australian Federal Police said in a statement, declining to comment further as the probe is ongoing.

Top officials from a subsidiary of Majlis Amanah Rakyat, an agency that provides government scholarships, and two Malaysian businessmen were involved in using public funds to buy property at a price inflated by A$4.75 million ($3.7 million), Fairfax media reported Tuesday. The additional money from the sale of Dudley House to MARA was sent back to Malaysia as bribes, Fairfax reported, citing documents and e-mails from a liquidator.

Australian police have launched Operation Carambola to probe the allegations and seized computers and files during Thursday’s raids, Fairfax media reported.

Malaysian authorities are also investigating, Prime Minister Najib Razak said in a Twitter post late Tuesday.

The Australian government is concerned that overseas demand for residential real estate is helping drive home prices higher and is trying to avert a public backlash against unaffordable housing.