Network School in Johor's Forest City faces scrutiny over allegations of Israeli participants using second-country passports, prompting government investigations.
Singapore, Singapore Jul 15, 2026 ALN: SINGAPORE – In 2024, American entrepreneur and investor Balaji Srinivasan, known for his role as the chief technology officer of cryptocurrency exchange Coinbase, launched a technology start-up co-living and co-working project in Johor’s Forest City. This initiative, referred to as Network School, has since become embroiled in controversy following allegations that it has hosted Israeli participants utilizing second-country passports. This development has prompted the Malaysian authorities to initiate an investigation into the matter.
On July 15, Malaysian Prime Minister Anwar Ibrahim addressed the controversy, stating that any Israeli citizens involved in Network School would be deported immediately. He emphasized the importance of adhering to Malaysia's stance on Israel, which does not recognize the state and maintains a pro-Palestine position. "The matter has been left to the relevant agencies, and I believe the Higher Education Minister will explain," Anwar said, highlighting the government's commitment to addressing any potential wrongdoing.
Malaysia's relationship with Israel is complex and fraught with historical and political tensions. The country does not maintain diplomatic ties with Israel, a stance that has been consistent for decades due to its support for Palestinian rights. As a result, Israeli passport holders are generally barred from entering Malaysia unless they receive special permission from the Home Ministry. However, the situation becomes more complicated when Israeli citizens enter Malaysia using passports from other countries, a practice that, while legal, raises concerns among Malaysian authorities.
In light of the allegations surrounding Network School, Malaysia's Home Ministry announced on July 14 that a full investigation had been launched. The ministry vowed to take strict action against any misuse of the country’s immigration facilities. By July 15, the Immigration Department reported that 266 foreigners from 40 different countries were being investigated, with initial checks indicating that all individuals held valid immigration documents. However, the investigation is ongoing, with authorities looking into possible identity fraud, misuse of travel documents, and breaches of immigration conditions.
Forest City, the site of Network School, has stated that it takes the nationality-related allegations seriously and is committed to cooperating fully with Malaysian authorities during the investigation. In a press release issued on July 15, Forest City reiterated its zero-tolerance policy toward any violations of the law or activities that could jeopardize public safety and national interests. Despite the seriousness of the allegations, neither Srinivasan nor Network School has made any public comments regarding the situation.
To grasp the full scope of the controversy, it is essential to understand what Network School represents. The program markets itself as a "frontier community for techno-optimists," providing a co-living space where tech founders, content creators, and entrepreneurs can live, work, collaborate, and share ideas. This communal approach aims to foster innovation and creativity within the tech sector.
Moreover, Srinivasan envisions Network School as a foundational step toward establishing a "network state"—a concept where technopreneurs can collectively create a new country from dispersed tech communities worldwide. The ultimate goal is for these new entities to gain diplomatic recognition from existing states, a notion that challenges traditional ideas of nationhood and governance.
In February 2025, Srinivasan announced on his website that Network School would have a capacity for 245 members, with plans for a permanent campus capable of accommodating over 1,024 individuals. Membership for the three-month program starts at US$1,500 (approximately S$1,900) per month, which includes shared hotel-like accommodation, meals, gym access, and co-working facilities. Attendees have reported enjoying various amenities, including beachfront living, daily buffet meals, and workshops led by notable figures in the technology and artificial intelligence sectors.
Located along the shores of the Strait of Johor, near the Second Link connecting to Singapore’s Tuas, Forest City is a large-scale property development project that has faced numerous challenges since its inception in 2016. Initially designed to house 700,000 people across four man-made islands by 2035, the project has only seen about 15 percent completion. The ambitious US$100 billion development has encountered significant hurdles, including environmental concerns, the implementation of China's capital controls in 2017, and changes in Malaysian policy following former Prime Minister Mahathir Mohamad's return to power in 2018, which made it more difficult for foreign buyers to secure residency visas.
The Covid-19 pandemic further exacerbated the project's struggles, leading to its characterization as a "ghost town." However, a recent boost came in August 2023 when Prime Minister Anwar designated Forest City as a Special Financial Zone, offering tax incentives to attract companies and family offices. As of April 2026, Country Garden Pacificview, the developer behind Forest City, reported that the area was home to nine family offices, with expectations for more to follow.
In an interview with Bloomberg, Johor’s former executive councillor for investments, Lee Ting Han, noted that the influx of international participants through Network School has revitalized the area, bringing a much-needed energy that had been lacking. Additionally, Digital Minister Gobind Singh Deo and his deputy Wilson Ugak Kumbong visited Network School in April 2026, further underscoring the government's interest in the project.
The concerns regarding Network School's presence in Johor came to the forefront on July 14, when Johor Menteri Besar Onn Hafiz Ghazi raised alarms following his coalition Barisan Nasional’s significant victory in the state elections on July 11. Onn Hafiz expressed that the Johor state government is taking the "people’s concerns seriously" and has requested the relevant federal ministries to investigate the operations of Network School, including allegations that some Israeli citizens are participating in the program using second-country passports.
"I would like to affirm that the Johor state government will not allow any party to use this state as a base to introduce ideologies that could threaten national security," Onn Hafiz stated, reflecting the government's commitment to ensuring that foreign entities do not undermine Malaysia's sovereignty or security interests.
The controversy surrounding Network School highlights the broader tensions within Malaysia regarding immigration policy, national security, and the geopolitical landscape in the region. As Malaysia grapples with its position on Israel and its relationships with various nations, the outcome of the investigation into Network School could have significant implications for the future of foreign investment and international collaboration in the country. The situation serves as a reminder of the delicate balance that Malaysia must maintain in navigating its foreign policy while fostering economic growth and innovation within its borders.
As the investigation unfolds, many will be watching closely to see how the Malaysian government addresses these allegations and what measures it will implement to safeguard its national interests while promoting a conducive environment for technological advancement and investment.
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