Malaysia's prime minister said authorities will deport any Israeli nationals found in the country, as investigations intensified over allegations that Israelis were taking part in a private tech community in the southern state of Johor.
Anwar Ibrahim announced on 15 July that Malaysia would not compromise on its immigration policy, saying the country does not recognise Israel. His statement came as officials looked into claims that Israelis were involved in the Network School, a residential and technology community in Forest City, a Chinese-backed development near Singapore.
Johor Chief Minister Onn Hafiz Ghazi asked local authorities to re-examine the school's business regulations and urged federal agencies, including the Home Affairs Ministry, Immigration Department and police, to investigate. The ministry ordered a probe the same day.
After two rounds of checks, the Immigration Department said it found no violations among 379 foreign nationals examined at the school, but added that the movements of 19 people could not be traced. The department's director-general said those individuals may have entered or left the country illegally and that authorities were looking for them.
On 17 July, the Johor government issued notices to the Network School after finding that one of its premises was operating without a valid business licence.
On 23 July, the United States summoned Malaysia's ambassador to explain the country's position on Israel. Malaysia said it would not change its stance.
The Network School was founded by Balaji Srinivasan, a former Silicon Valley venture capitalist and Stanford professor, who publicised the concept of a "network state" - a digitally organised community that seeks physical territory and eventual diplomatic recognition. He announced on X that he wanted to meet the prime minister to restore confidence in Malaysia as a place to invest.
Forest City, where the school is based, is a multibillion-dollar project built on reclaimed land and has faced criticism over its environmental impact and reliance on low-wage foreign labour. Johor has become a key hub for data centre investments, with Malaysia attracting about $759m in such investments between July 2024 and June 2025.
In a separate development, police last week uncovered two alleged online scam syndicates operating across 32 luxury homes in Forest City, detaining 335 people. Johor police chief Ab Rahaman Arsad said the raids raised questions about whether oversight is keeping pace with the government's push to revive the area as a hub for global wealth and talent.