AS IF being investigated by seven countries wasn’t enough, 1MDB is also flirting with default. Government gumshoes in Switzerland, America and elsewhere are said to be close to mapping the full money trail in a suspected multi-billion-dollar scam centred on the heavily indebted Malaysian state investment fund. As their probes intensify, 1MDB’s relationship with a big backer is unravelling: IPIC, an Abu Dhabi sovereign fund, has declared 1MDB to be in breach of an important financial contract between the two—and has duly terminated it. The move complicates an already tricky debt restructuring at 1MDB. It also fans the flames of a scandal that touches the upper reaches of Malaysian politics and international finance.

IPIC bailed out 1MDB last year with a $1 billion loan and an agreement to take responsibility for interest payments on some of 1MDB’s bonds; in return 1MDB was to transfer undisclosed assets to IPIC. But on April 18th the Gulf fund said 1MDB was “in default” on the deal, and stopped making payments to bondholders, including $50m due this week. That kicked off a five-day grace period. 1MDB says it has “ample liquidity” to cover the obligations.

The reason for IPIC’s ire is $1.1 billion that appears to have gone missing. 1MDB was supposed to transfer this to IPIC as part of their deal, but IPIC says it was never received. Investigators believe this was part of a larger sum—perhaps $3.5 billion—that was siphoned off from 1MDB to a shell company in the British Virgin Islands which had an almost identical name to one of IPIC’s subsidiaries, Aabar, but was unconnected to it.

Investigators think some of the diverted money ended up in the personal bank accounts of Najib Razak, Malaysia’s prime minister (pictured). Bank records seen by the Wall Street Journal show that $15m was spent on personal items such as jewellery, with a larger amount funnelled into the ruling coalition’s 2013 election campaign. Mr Najib denies ever having taken public money for personal gain. Malaysia’s attorney-general says a $681m payment into the prime minister’s accounts was a legal personal donation from a Saudi royal.

The investigators believe much of the cash that flowed into Mr Najib’s accounts came via an offshore firm whose beneficial owner was a business partner of a Malaysian financier called Jho Low, a member of Mr Najib’s inner circle at the time, according to the Wall Street Journal. Mr Low is thought to have played a key role in the transfers. He has denied wrongdoing.

Some $150m is also believed to have flowed from 1MDB to Red Granite Pictures, a film-production firm co-founded by Mr Najib’s stepson. This outfit subsequently financed “The Wolf of Wall Street”, a Hollywood film about a hedonistic crook. Red Granite denies wrongdoing. Mr Najib’s younger brother may also be caught up in the affair: Nazir Razak has taken a voluntary leave of absence from CIMB, the Malaysian bank he chairs, while a review is conducted into a $7m transfer into his personal account from the prime minister.

Investigations within Malaysia have been timid or stymied. Last year the attorney-general was replaced—supposedly on health grounds, though leaked documents appear to show he was about to bring criminal charges against Mr Najib. His successor has rebuffed calls by the central bank for 1MDB to face charges. A parliamentary report into the fund’s affairs identified irregularities but stopped short of alleging outright fraud.

That leaves other countries to make the running. On April 12th the Swiss said the scope of their enquiries was widening, and that they were now investigating two former public officials from the United Arab Emirates—understood to be former bigwigs at IPIC and Aabar. The statement, unusually blunt for an ongoing probe, talked of suspected “embezzlement”, “criminal mismanagement”, “forgery” and “money-laundering”.

The Swiss earlier estimated the amount possibly misappropriated through 1MDB to be $4 billion. Some investigators now reckon it could be as much as $6 billion. Switzerland’s top financial regulator calls it a “clear” case of corruption, with “concrete indications” of “inadequate” anti-money-laundering measures by banks that handled 1MDB’s cash, among them some of the biggest names in finance. America’s FBI is believed to be looking at bank transactions, property deals and much else besides. With graft and dodgy offshore manoeuvres high up political agendas after the leaking of the “Panama papers”, investigators have an added incentive to dig deep. The 1MDB affair could become an important test of how the world deals with cross-border corruption.