Published: Fri, November 02, 2018
World News | By Laverne Osborne

U.S. charges Malaysian financier in multibillion-dollar scheme

U.S. charges Malaysian financier in multibillion-dollar scheme

United States prosecutors unveiled criminal charges on Thursday against two former Goldman Sachs Inc bankers and Malaysian financier Low Taek Jho tied to the Malaysia 1MDB sovereign wealth fund scandal.

Two former Goldman Sachs investment bankers were charged Thursday with helping to raise money for a Malaysian investment fund that has lost $4 billion, according to federal prosecutors.

The men were charged with conspiring to launder billions of dollars from 1MDB and conspiring to bribe officials in Malaysia and Abu Dhabi, violating the Foreign Corrupt Practices Act.

These are the first criminal charges brought in the case, and the indictment accuses the men of laundering dirty money through the US financial system by purchasing luxury New York City real estate, artwork from an unnamed New York-based auction houses, and by funding unspecified major Hollywood productions.

The unidentified co-conspirator is Andrea Vella, according to two people familiar with the matter who spoke on the condition of anonymity because they were not authorized to speak publicly.

The alleged misappropriation of billions of dollars from the 1MDB fund has become the focus of an global scandal reaching from Malaysia to the United States to Hong Kong.

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Ng was arrested yesterday in Malaysia by his officers to assist the US Department of Justice (DoJ) in its investigations, Bukit Aman Commercial Crime Investigation Department director Amar Singh Ishar Singh told The Star.

Ng, a managing director at Goldman, and Leissner, who worked as Southeast Asia chairman and managing director at Goldman, sought on three occasions to make Low a formal client, but were rebuffed because officials in the compliance group had "concerns" about the source of the person's wealth and deemed he would not be a "suitable" client.

Mr Low has previously denied charges filed in Malaysia, adding that it would be "impossible" for him to receive a fair trial there. Earlier this week, Malaysia put up for auction the Equanimity, a US$250 million luxury yacht, also allegedly bought by Low with 1MDB funds. Prosecutors from the Justice Department's money-laundering and asset-recovery division also played an active role in the foreign bribery investigation.

At least six countries, including Malaysia, the United States and Switzerland, have been investigating alleged thefts from 1MDB. It relied primarily on debt to fund investment and economic development projects and was overseen by senior Malaysian government officials, according to court records.

Goldman, the $86 billion Wall Street investment bank, underwrote $6 billion of bonds issued by 1MDB during the time of the alleged fraud, earning about $600 million in fees, the US Department of Justice said yesterday. He has called the Malaysian charges political.

Leissner's attorney did not return messages seeking comment. Low did not have an immediate comment. The BBC has not yet been able to contact a lawyer representing him. Both Leissner and Ng departed the bank over 12 months ago.

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