Ex-Goldman Sachs banker tied to 1MDB scandal blames bank's 'culture' in guilty plea

An ex-Goldman Sachs banker who pleaded guilty to conspiring to steal money from Malaysia's state investment ...

Posted: Nov 10, 2018 12:17 PM
Updated: Nov 10, 2018 12:17 PM

An ex-Goldman Sachs banker who pleaded guilty to conspiring to steal money from Malaysia's state investment fund said Goldman's "culture" encouraged executives to work around the legal team to score business.

It was "very much in line of its culture of Goldman Sachs to conceal facts from certain compliance and legal employees," said Tim Leissner, Goldman's former Southeast Asia chairman, in his guilty plea from August, which was unsealed in federal court in Brooklyn Friday.

Asia

Banking, finance and investments

Business, economy and trade

Companies

Continents and regions

Crime, law enforcement and corrections

Criminal law

Goldman Sachs

Guilty pleas

Law and legal system

Scandals

Southeast Asia

Government and public administration

Government bodies and offices

Government departments and authorities

Justice departments

Malaysia

Leissner admitted that he hid from Goldman the fact that Malaysian financier Jho Low secured business for the bank by bribing officials in Malaysia and Abu Dhabi. The US government alleges Low played a central role in a scheme to launder billions of dollars from the Malaysian sovereign wealth fund, 1Malaysia Development Berhad.

Last week, the US Justice Department announced charges against Leissner, Low and Roger Ng, another former Goldman banker. The agency said that Leissner would forfeit $43.7 million.

Goldman Sachs (GS) continues to face scrutiny for its role in the scandal.

The bank in 2012 and 2013 arranged three bond offerings for the 1MDB fund that raised about $6.5 billion, according to the court documents. The bank made about $600 million for its work, the Justice Department said.

More than $2.7 billion from those offerings was siphoned off, with the knowledge of Leissner and Ng, to bribe government officials in Malaysia and Abu Dhabi, according to the indictments. Leissner and Ng are said to have worked around internal legal and compliance controls at Goldman Sachs to make sure the deals would go through.

The business culture at Goldman "was highly focused on consummating deals, at times prioritizing this goal ahead of the proper orientation of its compliance functions," especially in Southeast Asia, government prosecutors said in their indictment of Low and Ng unsealed last week.

The legal team at Goldman had raised concerns about Low in the past, the indictment said.

A Goldman Sachs spokesperson said the firm continues to cooperate with all authorities investigating the matter.

Ng was arrested last week in Malaysia, according to the Justice Department, and has not yet entered a plea. He could not be reached for comment. Low, who maintains his innocence, remains at large. A spokesperson for his legal team said Low held no formal position at 1MDB and was neither employed by Goldman Sachs nor the governments of Malaysia or Abu Dhabi.

It's unclear if anyone else at the bank beyond Leissner and Ng knew about Low's involvement in the bond deals.

The Wall Street Journal on Friday reported that former Goldman Sachs CEO Lloyd Blankfein, who stepped down from his role atop the bank in October, attended two meetings with Malaysia's former prime minister in 2009 and 2013 that included discussions of 1MDB. Low was present at both meetings, according to the Journal.

A source familiar with the matter said that Blankfein had no recollection of meeting Low, and it's unclear if Low was present at the two meetings.

Another Goldman banker, Andrea Vella, was placed on leave last week, pending a review of alleged conduct related to the 1MDB case. Vella had been demoted from his position as co-head of investment banking in Asia last month.

The Justice Department alleges a total of $4.5 billion was stolen from the 1MDB fund by high-level officials. US officials claim that laundered funds were pumped into New York condos, hotels, yachts and a jet, and used to fund Hollywood films such as "The Wolf of Wall Street."

West Lafayette
Clear
51° wxIcon
Hi: 68° Lo: 45°
Feels Like: 51°
Kokomo
Clear
49° wxIcon
Hi: 64° Lo: 42°
Feels Like: 47°
Rensselaer
Scattered Clouds
45° wxIcon
Hi: 66° Lo: 42°
Feels Like: 45°
Fowler
Scattered Clouds
45° wxIcon
Hi: 64° Lo: 43°
Feels Like: 45°
Williamsport
Clear
45° wxIcon
Hi: 66° Lo: 43°
Feels Like: 45°
Crawfordsville
Clear
48° wxIcon
Hi: 67° Lo: 43°
Feels Like: 48°
Frankfort
Clear
46° wxIcon
Hi: 66° Lo: 42°
Feels Like: 42°
Delphi
Clear
47° wxIcon
Hi: 67° Lo: 43°
Feels Like: 44°
Monticello
Clear
47° wxIcon
Hi: 63° Lo: 43°
Feels Like: 44°
Logansport
Clear
46° wxIcon
Hi: 64° Lo: 41°
Feels Like: 44°
Some more scattered rain with windy & cooler conditions.
WLFI Radar
WLFI Temps
WLFI Planner

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 119066

Reported Deaths: 3612
CountyConfirmedDeaths
Marion21563768
Lake10745324
Elkhart6734112
St. Joseph6679115
Allen6364205
Hamilton4965109
Vanderburgh384231
Hendricks2779124
Monroe267137
Tippecanoe259013
Johnson2362125
Clark226757
Porter222447
Delaware201162
Cass19589
Vigo187928
Madison171475
LaPorte151941
Warrick140743
Floyd140464
Howard133964
Kosciusko127117
Bartholomew119357
Marshall102124
Dubois100919
Boone99746
Grant96636
Hancock94843
Noble92932
Henry82226
Jackson77610
Wayne77314
Morgan73940
Shelby68329
Daviess68129
Dearborn67928
LaGrange64711
Clinton63414
Harrison59824
Putnam59011
Gibson5455
Knox5379
Lawrence51829
Montgomery51321
DeKalb49111
White48814
Decatur46139
Miami4394
Greene42936
Fayette42314
Jasper4032
Steuben3977
Scott39311
Posey3541
Sullivan33812
Jennings31712
Franklin31525
Clay3105
Ripley3108
Orange28724
Whitley2876
Carroll28013
Adams2773
Wabash2758
Starke2737
Washington2702
Wells2694
Spencer2683
Jefferson2523
Huntington2503
Fulton2462
Tipton22922
Randolph2238
Perry22213
Jay1920
Newton17411
Owen1711
Martin1690
Pike1691
Rush1584
Vermillion1320
Fountain1302
Blackford1223
Pulaski1141
Crawford1100
Parke1072
Brown1033
Benton860
Ohio797
Union790
Switzerland690
Warren411
Unassigned0227

COVID-19 Important links and resources

As the spread of COVID-19, or as it's more commonly known as the coronavirus continues, this page will serve as your one-stop for the resources you need to stay informed and to keep you and your family safe. CLICK HERE

Closings related to the prevention of the COVID-19 can be found on our Closings page.

Community Events