What does 1MDB stand for and when was it set up?

It stands for 1 Malaysia Development Berhad. "Berhad" is a Malay word meaning

"private" and is used to describe a limited company in Malaysia.
It was created as a sovereign wealth fund in 2009, not long after Nijib Razak
became Malaysia's prime minister. The government said it was set up to promote
economic development, to promote foreign direct investment and to turn Kuala
Lumpur into a global financial hub.

How does it differ to other sovereign wealth funds?

Sovereign wealth funds are usually set up from a country's budgetary surplus,
giving a government the chance to invest rather than let cash sit in a central
bank.
But the difference with 1MDB was that it was not based on any surpluses.
Rather, it was built on raising debt to acquire assets. These debts, through bond
issues, increased to $11bn (7.7bn) by March 2014 and fears naturally grew over
how interest would be paid on these loans.
Some of the proceeds from bond issues were used to buy assets like power
plants. Other funds went to joint ventures with international partners, such as Abu
Dhabi and Saudi Arabia.

Explain the Saudi Arabia connection?

The Wall Street Journal reported that it had seen a paper trail that traces close to
$681m from the fund into the personal bank account of prime minister Najib
Razak, which came from the Saudi royal family.
Najib admitted receiving the sum but denies wrongdoing and says the money
was not connected to 1MDB. He was cleared of wrongdoing by the Malaysian
attorney general but there is criticism that the government is trying to bury the
story.

His allies say that transfer was a political donation, paid in a way that is common
for the ruling United Malays National Organisation.

Who is involved?
A criminal investigation by the Attorney General of Switzerland is under way and
in January it was reported that there were "serious indications" that about $4bn
was misappropriated. The Swiss investigation is looking at five companies:
PetroSaudi; SRC (which was a former 1MDB subsidiary); Genting and Tanjong,
(which were Malaysian conglomerates); and ADMIC, which is a joint venture
between 1MDB and Aabar Investments.
Also criticised is Goldman Sachs, which helped raise capital for 1MDB and
arranged three bond sales in 2012 and 2013. These, according to the FT,
included a transaction where it collected a fee worth nearly $300m on a 3bn
issue. The FBI is reportedly investigating Goldman Sachsregional chairman Tim
Leissner's connections to the Malaysian prime minister.

Where is it being investigated?

There are several other investigations under way, including ones in the US,
Singapore and Hong Kong. The UK Serious Fraud Office launched a moneylaundering inquiry in September 2015. Meanwhile, on 4 February, France
announced that prosecutors would investigate claims that Najib took kick-backs
as part of a $1.2bn arms deal.

Could it bring down Najib?

Najib remains adamant that he will not step down over the matter, and "that the
government has its own way of solving the 1MDB issue", CNN reported.
However, Malaysia is a parliamentary democracy and thus Najib, who is also
president of his party, would not be expelled unless parliament passes a vote of
no confidence against him, his party removes him or the authorities charge him
for corruption.