02 Nov 2018
The United States Department of Justice has charged two former Goldman Sachs bankers and Malaysian financier Jho Low with with conspiring to launder billions of dollars embezzled from state fund 1Malaysia Development Berhad (1MDB) and paying bribes to various Malaysian and Abu Dhabi officials.
The 1MBD scandal can be traced to allegations that former Malaysian prime minister Najib Razak pocketed $700m from the fund, allegations he denies. Jho Low – or Low Taek Jho – who reportedly has close ties to high ranking Malaysian government figures, is alleged to have acted as an adviser for the fund.
According to the DoJ, Low and former Goldman bankers Ng Chong Hwa – also known as “Roger Ng” – and Tim Leissner were part of a scheme where they conspired to bribe government officials in Malaysia, including at 1MDB, and Abu Dhabi to obtain and retain lucrative business for Goldman, including 2012 and 2013 bond deals.
Leissner was the former Goldman Southeast Asia Chairman and participating managing director, while Ng was employed at as a managing director.
They also allegedly conspired to launder the proceeds of their criminal conduct through the U.S. financial system by purchasing, among other things, luxury residential real estate in New York City and elsewhere, and art work from a New York-based auction house, and by funding major Hollywood films.
“As a result of its work for 1MDB during that time, the Financial Institution allegedly received approximately $600 million in fees and revenues along with increased reputational prestige. At the same time, Ng, Leissner and others allegedly received large bonuses and enhanced their own reputations at the Financial Institution,” the DoJ explained.
“In total, according to allegations in court filings, more than $2.7 billion was misappropriated from 1MDB and Low, Ng, Leissner and others conspired to launder this money through the U.S. financial system to pay bribes to foreign officials and for the personal benefit of themselves and their relatives.”
Leissner has pleaded guilty to conspiring to launder money and paying bribes. He has been ordered to forfeit $43.7 million as a result of his crimes.
Ng was arrested in Malaysia on Thursday.
Low, who remains at large, has reportedly profusely denied allegations of wrong doing. His legal team, quoted by the BBC, said in a statement: “Mr. Low simply asks that the public keep an open mind regarding this case until all of the evidence comes to light, which he believes will vindicate him.”
You can claim CPD minutes for reading this article, by signing up to our CPD WalletFREE CPD Wallet