US tech tycoon shelves Malaysia investment after immigration raid

US tech investor Balaji Srinivasan has announced he was freezing projects in Malaysia after authorities raided his start-up campus over claims it was hosting foreigners including Israelis illegally.

Srinivasan, a former Coinbase senior executive, said Malaysian officials had inspected "hundreds of passports" at Network School, his nearly $25 million development in southern Johor state, after unsubstantiated online allegations it was flouting immigration rules.

"The authorities confirmed... that all travel documents were in order," Srinivasan posted on X on Thursday, adding that "at this point, all further investment we were planning to make in Malaysia is on hold until we get sufficient assurance that such issues won't recur."

The claims against Network School said it was allowing Israelis with dual citizenship to work there, despite Malaysia not recognising Israel.

Authorities said on Wednesday there was no evidence of any Israeli citizens living or working at Network School, a residential campus for startup founders, software engineers, investors and digital entrepreneurs.

Muslim-majority Malaysia has no diplomatic ties with Israel and is a vociferous critic its war in Gaza.

Malaysia bars entry for Israeli passport holders, but does not have specific laws about second-country passport holders.

Srinivasan said his investment group would now seek a meeting with Prime Minister Anwar Ibrahim's office to discuss the terms of a memorandum of understanding between Network School and the Malaysian government.

The prime minister's office was not immediately available for comment.

Malaysia has positioned itself as a technology hub by leveraging government support, foreign investment and competitive business and living costs.

The strategy has attracted billions of dollars in technology investment in recent years, particularly in data centres in Johor and semiconductor manufacturing in Penang in the north.

But experts said challenges remain, including a small venture capital ecosystem, bureaucratic hurdles and talent outflow.

AFP

𝗗𝗼𝘄𝗻𝗹𝗼𝗮𝗱 𝗧𝗵𝗲 𝗦𝘁𝗮𝗻𝗱𝗮𝗿𝗱 𝗔𝗽𝗽 ↓