Prosecutors used anti-terror laws to charge Khairuddin Abu Hassan, a former Umno official who was expelled from the party, and Matthias Chang, an ex-adviser to Mahathir Mohamad, the former prime minister. The two men had met law enforcement agencies in several countries investigating the 1MDB affair, including the US, Switzerland and Hong Kong.
At a news conference in Kuala Lumpur, Mr Mahathir, who is Mr Najib's one-time patron, condemned what he branded a "climate of fear" in the country created by a government "now defining the law according to their own needs".
The ex-premier was flanked by fellow senior Umno figures including Muhyiddin Yassin, who was sacked as deputy prime minister in July, Shafie Apdal, party vice-president, and Tengku Razaleigh Hamzah, a former finance minister tipped by some as a possible caretaker prime minister should Mr Najib step down.
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"We are here to show that we are against the abuse of the law in our country," Mr Mahathir said.
Mr Muhyiddin stopped short of echoing Mr Mahathir's longstanding calls for Mr Najib's resignation, but urged Umno members to be "more expressive" and not to be fearful of doing what was right. "There are problems of concern and it is up to the prime minister to consider what he should do that is best for the nation," he said.
Mr Najib has been under growing pressure amid a string of damaging disclosures over the multibillion-dollar cross-border dealings of 1MDB, whose advisory board he chairs. In July, it emerged that payments of almost $700 million were made into a bank account in Mr Najib's name.
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The premier says the money was from an unnamed Middle Eastern donor and was not for his personal gain. Both he and 1MDB have denied all wrongdoing. A government spokesman did not immediately respond to a request for comment on the latest attacks on the prime minister.
The 1MDB crisis is damaging confidence in Malaysia and its state institutions at a time when the economy is already under pressure from falling oil prices, high consumer debt levels and a plunge in the ringgit's value.
Umno hung on to power despite losing the popular vote in the 2013 election. Some party officials fear the next polls could see it tumble to its first defeat since Malaysia's independence from Britain in 1957.