Lim Guan Eng is expected to be charged in court on Thursday.
A Malaysian opposition leader and vocal critic of scandal-hit Prime Minister Najib Razak was arrested today for alleged corruption, in a move that could see the lawmaker jailed, a party official said.
Lim Guan Eng, who has demanded Najib explain a massive financial scandal linked to state investment fund 1Malaysia Development Berhad (1MDB), is expected to be charged in court on Thursday.
The 55-year-old Lim has been chief minister of Penang state since 2008 and has led the opposition Democratic Action Party (DAP) since 2004 as secretary-general.
"Lim was served with a warrant of arrest by the Malaysian Anti-Corruption Commission (MACC) this evening on two corruption charges," Jeff Ooi, a DAP lawmaker told AFP.
MACC officials could not be reached for comment.
Ooi said one of the charges is related to improper change of use of public land to allow development.
The other is tied to the purchase of a house by Lim, and which if found guilty could see the chief minister jailed, he said.
Lim was probed by the MACC last year for corruption over the purchase of a house at a below market price of 2.8 million ringgit ($693,000). He denies any allegations of impropriety.
"But we expect Lim, who is in MACC custody now, to be freed on bail after being charged in court Thursday," Ooi said.
Najib was personally plunged into the crisis last year when it was revealed that $681 million in transfers were made to his personal bank accounts in 2013.
He says the "personal donations" from the Saudi royal family were mostly returned.
Hundreds of millions of dollars of 1MDB money has gone missing in complex overseas transactions that have never been fully explained. Swiss authorities say more than $4 billion may have been stolen.
Both 1MDB and Najib, who founded the fund, vehemently deny wrongdoing.
In January, attorney general Mohamed Apandi Ali closed a graft investigation, clearing Najib of wrongdoing and said no criminal offence had been committed.
Lim, meanwhile, was previously jailed in 1998 for 12 months on sedition charges.