The Penang Institute today denied media reports that it had purportedly received funds from Open Society Foundations (OSF), an outfit backed by American businessman George Soros.

"The allegation was derived from a 'leaked document' obtained from a website called DC Leaks. In the document, Penang Institute was listed as a beneficiary of a study grant for graduate fellowships at the Central European University’s School for Public Policy in Hungary.

"We would like to state categorically that Penang Institute has neither received nor applied for any funds from Open Society Foundation. None of our staff have also received the Central European University fellowship as alleged by the document.

"In other words, Penang Institute has no links whatsoever to these organisations," said its executive director Zairil Khir Johari in a statement.

Zairil, who is also DAP's Bukit Bendera MP, clarified that the Institute is a public policy think tank of the Penang state government.

"We do not receive funding from foreign sources without the approval of the state government. Therefore, the attempt to tarnish our image with these baseless allegations is nothing less than malicious. We reserve the right to take legal action if necessary," he added.

Zairil also questioned the motive behind the allegations, particularly the targeting of various organisations and bodies known to be independent and critical of the ruling government.

"We therefore condemn unreservedly the malicious campaign to smear civil society organisations and institutions simply because they are not aligned with the federal government," he said.

The institute is one of several organisations that have been accused of receiving funds directly or indirectly from OSF.

The issue was played up by right-wing groups as an attempt by Soros, who is of Jewish descent, to influence Malaysian politics.