Malaysia’s new prime minister has claimed that investigators have an “almost perfect case” against former leader Najib Razak, who will face charges of bribery, theft of government funds and embezzlement for his role in the 1MDB scandal.

Mahathir Mohamad described on Wednesday how Najib’s signature was on all the 1MDB transaction documents. In an interview with Reuters, Mahathir said Najib was “totally responsible for 1MDB. Nothing can be done without his signature, and we have his signature on all the deals entered into by 1MDB. Therefore, he is responsible.”

Najib set up the 1MDB government fund in 2009 but it became entrenched in scandal in 2015 when it emerged that billions had been embezzled around the world, allegedly used by associates of Najib’s to fund spending sprees and yachts. Some $681m of the fund was alleged to have been transferred into Najib’s personal bank account and used to purchase jewellery for his wife Rosmah Mansor and pay their credit card bills.

According to Tony Pua, a minister in the finance office, 1MDB’s debts and losses total $10bn.

Quick Guide 1MDB Show The scandal 1Malaysia Development Berhad, was set up in 2009 to promote economic development. The Malaysian prime minister, Najib Razak, chaired its advisory board and, according to the US Justice Department, top executives and associates of Najib looted $4.5bn from the fund between 2009 and 2014, laundering it through the US, Singapore, Switzerland and other countries. Hundreds of millions landed in Najib's bank account, though he denies any wrongdoing. Where the money went The US Justice Department is seeking to recover money from the fund it says was gambled in Las Vegas, used to buy hotels, apartments, a luxury yacht, a jet, diamond jewellery, art works and to finance Hollywood films including the Wolf of Wall Street and Dumb and Dumber To. The investigation US prosecutors have alleged layers of foreign bank accounts and shell companies were used to launder the money and named Low Taek Jho, a friend of Najib’s stepson, as a key figure in the conspiracy. In one email he wrote "Looks like we may have hit a goldmine" after organising a 1MDB deal that would later allegedly become a money laundering vehicle. Singapore has fined eight banks for failing to carry out proper anti-money laundering measures in relation to 1MDB and given prison sentences to several bankers. Political impact A parliamentary inquiry found many irregularities but had no mandate to prosecute so, outraged by the scandal, 92-year-old former leader Mahathir Mohammad came out of political retirement and opposition united behind him for the elections. The government recently passed a "fake news" law that could be used to further stifle reporting on the case within Malaysia.

While in office Najib fired those who tried to bring charges against him for 1MDB and then oversaw an investigation that cleared himself of all wrongdoing. During the election, the 1MDB chief executive officer Arul Kanda went on a campaign declaring that the fund was in good health.

However, since the opposition won the May election, led by 92-year-old Mahathir, they made the renewed 1MDB investigation a key priority. Newly appointed finance minister Lim Guan Eng recently described 1MDB as the “worst corruption scandal ever in Malaysian history”.

Responding to Mahathir’s comments, Najib told Reuters: “As far as I am concerned, I did not do anything that I thought was illegal.”

Mahathir said he expected arrests in the next few months and said that a trial would “hopefully” be underway by the end of the year. There would be “no deal” for Najib.

The charges Najib is likely to face in court are “embezzlement, stealing government money, losing government money and a number of other charges. Using government money to bribe. All those things,” said Mahathir, adding: “When we go to the courts, we will have clear evidence of the wrongdoing. We cannot afford to lose.”

Also subject to investigation is Najib’s wife Rosmah, who was alleged to profit personally from embezzled 1MDB funds, bankrolling her expensive taste in clothes and jewellery. A recent raid on an apartment linked to Rosmah and Najib, as part of the 1MDB investigation, saw 274 Birkin handbags seized as well as 72 bags of cash, jewellery and gold bars, the value of which is still being calculated.

However Mahathir acknowledged Rosmah’s alleged role was hard to prove. “Some of the money is believed to have gone to her, lots of money,” Mahathir said. “We know about this, but finding the paper trail is a bit more difficult in this case because she doesn’t sign any papers.”