The departure of a second auditor for a Malaysian government investment fund is putting focus on another global company that apparently failed to raise questions about what investigators are calling a large-scale fraud.

The fund, 1Malaysia Development Bhd. or 1MDB, said Tuesday that its auditor, Deloitte Touche Tohmatsu Ltd., resigned in February. An earlier dispute over the fund's accounts in 2013 led to the firing of 1MDB's previous auditor, KPMG, according to a Malaysian auditor general's report last year.

The fund also said its 2013 and 2014 financial statements, which were audited by Deloitte, should no longer be relied on.

Deloitte and KPMG join a long list of financial firms that have worked with 1MDB without identifying the alleged fraud there. These include Goldman Sachs Group, Swiss private banks Falcon Private Bank Ltd. and BSI SA, and other banks such as DBS Bank Ltd, Standard Chartered PLC and UBS Group AG. All have said they were unaware of the alleged fraud at 1MDB.

The Swiss attorney general's office said earlier this year it suspected $4 billion had been misappropriated from 1MDB. Last week, the U.S. Justice Department filed a civil lawsuit aiming to seize assets that it said were bought with $3.5 billion misappropriated from the fund. The Wall Street Journal has reported that hundreds of millions of dollars originating with 1MDB flowed into the personal bank account of Malaysian Prime Minister Najib Razak .

Deloitte said in a statement Tuesday that the information in the Justice Department lawsuit against 1MDB "would have impacted the financial statements and affected the audit reports" if it had been known at the time, and so its audit reports for 2013 and 2014 should no longer be relied upon.

Mr. Najib has said he did nothing wrong and that any suggestions of wrongdoing were political smears. The Malaysian attorney general has said the funds that went into Mr. Najib's account were a legal political donation from Saudi Arabia and cleared him of wrongdoing. It also said most of the money was returned.

In its statement, 1MDB said its board "remains confident" that the fund has committed no wrongdoing and that the two years' financial statements "continue to show a true and fair view of the company's affairs at the relevant points in time." Given the Justice Department allegations, however, 1MDB said the board had decided "as a precautionary measure" that the financial statements should no longer be relied upon.

In recent years, emerging markets like Malaysia have become an important source of clients for auditing firms like Deloitte and KPMG. But that has sometimes exposed them to risks in nations that don't have traditions of corporate governance and public disclosure as strong as those in the U.S. and Europe. Numerous companies in China have encountered accounting problems in recent years, for example.

KPMG signed off on 1MDB's accounts for the fiscal years 2010 through 2012. But according to a Malaysian auditor general's report last year, Mr. Najib, then chairman of 1MDB's board of advisers, fired KPMG in December 2013 after the firm balked at approving the fund's accounts unless it got more details on a specific $2.32 billion investment.

KPMG said in a statement that it has cooperated fully with Malaysian authorities investigating 1MDB. The firm said it couldn't comment further because of client-confidentiality obligations.

Deloitte, which succeeded KPMG as 1MDB's auditor, later signed off on the investment after a unit of an Abu Dhabi government fund, International Petroleum Investment Company, guaranteed it, a Deloitte auditor told a Malaysian parliamentary committee last year.

Deloitte itself had received allegations of fraud at 1MDB in 2014, according to minutes from 1MDB board meetings seen by The Wall Street Journal. Deloitte said there was no evidence of wrongdoing and signed off on the firm's accounts for fiscal 2014, according to the minutes.

Write to Michael Rapoport at Michael.Rapoport@wsj.com

(END) Dow Jones Newswires

July 26, 2016 21:35 ET (01:35 GMT)