BANGKOK  - Malaysia's anti-corruption czar has sued a local journalist for defamation over articles questioning the legality of his past shareholdings in a case seen by some as a bellwether and test of the country's rule of law.

Azam Baki, chief commissioner of the Malaysian Anti-Corruption Commission, filed suit against Lalitha Kunaratnam January 12 seeking some $2.38 million in damages and costs over a pair of articles first published in October by the Independent News Service, a local online news outlet. In them, Lalitha catalogues Azam's alleged business interests and connections and questions whether they were properly declared or pose a conflict of interest.

According to the reports, Azam held nearly 3 million shares in a pair of companies and over 2 million warrants in another over the course of 2015 and 2016 while director of investigation at the MACC, also in possible breach of legal limits for public servants. Azam's brothers, the articles add, built up their own extensive business interests during his rise through the ranks at the commission.

Azam denied any wrongdoing at a January 5 press conference and said he no longer held shares in any company. He said his brother, Nasir Baki, had used his trading account to buy shares in 2015 and that those shares were transferred to his brother's account later that year.

Light Strike Force team from the Royal Malaysian Police (LSF) stand at attention during a rally of 'Arrest Azam Baki' in Kuala Lumpur on Jan. 22, 2022.

Hundreds of people rallied in downtown Kuala Lumpur, Malaysia's capital, Saturday calling on Azam to step down over the allegations. Police blocked off major roads and shut down metro stations around the rally site in advance in order, some protesters claimed, to curb the size of the crowd.

Rights groups say Azam's lawsuit is in keeping with a shrinking space for the free press and growing harassment of journalists since the collapse of the progressive Pakatan Harapan coalition's government in early 2020. Malaysia fell 18 spots in the Reporters Without Borders annual press freedom index from 2020 to 2021, the sharpest drop of any country that year.

"Definitely there's been a worsening trend from the time of Pakatan Harapan [collapsing] to the current administration in terms of how the government engages with the press, in terms of how the government understands the role of the press," said Alyaa Alhadjri, a representative for Gerakan Media Merdeka, known as Geramm, a local press freedom advocacy group.

"I think it [this lawsuit] is an example of that," Alyaa said.

"In general, obviously it was an attempt to intimidate, to harass," she added.

Reporters Without Borders Asia-Pacific chief Daniel Bastard said Azam's suit was clearly aimed at silencing debate about his alleged business interests, and that there was more on the line than the free press.

He said the suit "manifestly violates the mandate of the MACC, an agency that is itself supposed to investigate corruption cases. The rule of law in Malaysia is at stake."

Malaysia has been battling a reputation for rampant government corruption for years.

Corruption scandals involving the alleged embezzlement of billions of dollars in state funds helped bring down the government of Prime Minister Najib Razak at the polls in 2018. Najib, who remains in parliament, has since been convicted of abuse of power, breach of trust and money laundering and sentenced to 12 years in jail. He denies any wrongdoing and is out on bail pending appeal.

Najib's tarnished party, the United Malays National Organization, has also managed to claw its way back to power without new elections through a series of political defections in parliament.

Azam's defamation suit against Lalitha now puts the reputation of the country's premier corruption-fighting body at risk as well, said Cynthia Gabriel, executive director of the Center to Combat Corruption and Cronyism, a local nonprofit.

"He should not have taken legal action, but cleared his name with facts," she said.

"As a central agency mandated to protect whistleblowers and improve its act, Azam has acted contrary to many efforts by the agency and has lent much disservice to the MACC," she added.

In a joint statement, Geramm and the local nonprofit Center for Independent Journalism said Azam's reaction to the allegations "calls into question the role of MACC and, ultimately, the State in eliminating corruption in Malaysia."

Gabriel and others have been calling for reforms to the MACC and Malaysia's Whistleblower Protection Act for years. Their proposals include creating a new commission voted in by parliament to oversee the MACC, whose members are appointed, and lifting restrictions in the Whistleblower Protection Act that limit protection only to those who report alleged abuses to enforcement agencies.

However, Gabriel said the current UMNO-led government has shown little interest in pursuing such reforms and that they were likely to gain traction only after Malaysians get another chance to vote on the government they want.

Neither the MACC nor the law firm representing Azam, Zain Megat & Murad, replied to VOA's requests for comment or for an interview with the chief commissioner.

Lalitha refused VOA's request for an interview.

In a January 9 statement through her own lawyer, Manjeet Singh Dhillon, Lalitha said she stood by her reporting and that the articles were based on public records, regulatory reports and corporate filings.