NEW YORK (BLOOMBERG) - Fugitive financier Low Taek Jho, the alleged mastermind of the 1MDB scandal, stole US$1.42 billion (S$1.94 billion) from three bond transactions that Goldman Sachs Group arranged for the Malaysian wealth fund, according to an FBI agent who traced the funds.
Federal Bureau of Investigation (FBI) agent Eric Van Dorn took the stand on Monday (March 14) at the trial of former Goldman banker Roger Ng in federal court in New York.
In addition to his testimony about Low, the agent told the jury that Malaysia’s former prime minister Najib Razak reaped US$756 million (S$1.03 billion) of the US$6.5 billion raised in the bond offerings.
Najib’s stepson, Riza Aziz, Mr Van Dorn said, pocketed US$238 million.
Mr Van Dorn said Khadem al-Qubaisi, a former managing director of Abu Dhabi’s state-owned International Petroleum Investment Co (IPIC), which guaranteed the 1Malaysia Development Berhad’s transactions, received US$472.8 million.
The agent also described another Abu Dhabi official who worked with the IPIC’s subsidiary and received US$76.6 million.
Ng, the only Goldman banker to go on trial over the epic looting of the sovereign wealth fund, has been charged with conspiring with Low and his former boss Tim Leissner in the massive fraud.
Leissner, who pleaded guilty and is cooperating with the US government, earlier spent more than a week on the stand as the star prosecution witness against Ng.
Low is not in custody and remains a fugitive. Prosecutors have long alleged that Low paid bribes to officials in Malaysia and Abu Dhabi to facilitate the deals, but Mr Van Dorn’s testimony was the first time the US has detailed how those involved in the 1MDB deals were paid and how much they received.
Mr Van Dorn, who is a forensic accountant for the FBI, said he reviewed 59,000 bank records to determine where the money from the three 1MDB deals went.
He said Riza Aziz invested at least US$60 million of his 1MDB money to produce The Wolf Of Wall Street movie. Riza Aziz was a friend of Low’s, the prosecutors said.
Riza Aziz twice before settled Justice Department lawsuits over his role in the 1MDB scandal. In 2017, his Red Granite production company agreed to pay US$60 million to settle US claims that the Wolf movie was financed with stolen 1MDB money.
In 2020, he resolved a separate government suit by agreeing to drop claims to tens of millions of dollars in American and British real estate without admitting wrongdoing.
Ng got US$35.1 million from two of the three bond transactions, while Leissner received US$73.4 million during the scheme, Mr Van Dorn testified.
At the time of his 2018 plea, Leissner agreed to forfeit just US$43.7 million which the US said was the money he earned in the scheme. It is unclear why Leissner is forfeiting a lesser amount.
Ng’s defence team, which has been trying to suggest that Leissner is getting a favourable deal, tried to ask Mr Van Dorn about the former banker’s forfeiture, but the judge barred questions about it.
One of Ng’s lawyers, Mr Jacob Kaplan, questioned Mr Van Dorn about how Leissner collected an additional US$39.7 million which went from Low’s accounts into an entity under the control of Leissner’s former wife Judy Chan Leissner, suggesting that the government had also given Leissner a break on these funds.
Mr Van Dorn said it was because his chart was based on certain transactions which occurred during the time frame of the three 1MDB bond transactions and that he had only included money directly traceable back to Goldman Sachs’s funding of the three deals.
Najib was convicted in Malaysia and sentenced to 12 years in prison and is appealing.
“The money sources, amounts and recipients have been explained differently in Malaysian court,” a spokesman for Najib’s attorney said in an e-mail.
Meanwhile, Al-Qubaisi was sentenced in Abu Dhabi in 2019 to 15 years in prison and ordered, along with the other IPIC executive, to repay US$336 million, according to the Wall Street Journal.