KUALA LUMPUR—Malaysian prosecutors charged a Cabinet minister's husband on Monday with misusing nearly 50 million ringgit (US $16 million) of funds meant for a government-backed cattle project.

The charge escalates a high-profile corruption scandal nicknamed “Cowgate” that could hurt Prime Minister Najib Razak's ruling coalition in general elections expected within months.

The allegations involve a cattle-farming company managed by the family of Women and Family Minister Shahrizat Abdul Aziz that's accused of using a government loan to purchase condominiums, vacations and a Mercedes.

Shahrizat and her family have denied any wrongdoing, but she announced over the weekend that she would relinquish her cabinet post in April amid mounting public criticism.

Shahrizat's husband, Mohammad Salleh Ismail, pleaded innocent in a Kuala Lumpur district court on Monday to four charges related to criminal breach of trust involving part of a 250 million ringgit ($83 million) government loan to the National Feedlot Corp.

Prosecutors said Mohammad Salleh, the company's executive chairman, violated corporate law through fund transfers and purchases totaling 49.7 million ringgit ($16 million), but did not give specific details.

Mohammad Salleh could be jailed up to 54 years if convicted. The court allowed him to remain free on bail and scheduled a preliminary hearing next month to decide on technicalities.

A verdict will not likely be delivered before Malaysia's next national elections, which many expect Prime Minister Najib to hold around June.

But the prosecution of Mohammad Salleh and the resignation of his wife underscore deep concerns within the government that it will lose crucial votes if viewed as being tainted and unwilling to tackle corruption.

Najib's coalition currently has less than a two-thirds parliamentary majority.

Shahrizat's family has insisted their company was allowed to use funds at its discretion and that its purchased properties would reap lucrative rental income.