1MDB case: Ex-Goldman banker's wife was a 'co-conspirator', US argues

US prosecutors want the jury to hear statements from the wife of Roger Ng, in the 1MDB trial. PHOTO: REUTERS

NEW YORK (BLOOMBERG) - The wife of former Goldman Sachs banker Roger Ng is becoming a key figure in his foreign-bribery trial, as prosecutors argue she helped him launder millions of dollars from the looting of 1MDB.

They want the jury to hear statements that Ng's wife Lim Hwee Bin made to bankers about an account and shell company they say she opened in 2012 - even as Ng's lawyers plan to call her as a witness on his behalf.

The defence says Ms Lim will testify that US$35.1 million (S$47.6 million) transferred into an account she controlled was not tainted 1MDB money but was for an unrelated business transaction.

Ng, the only Goldman banker to go to trial in the scandal, is accused of conspiring with his former boss Tim Leissner to help financier Jho Low siphon billions of dollars from a trio of bond deals the bank did for the sovereign wealth fund 1Malaysia Development Berhad, or 1MDB.

Leissner has pleaded guilty and is cooperating with the government against Ng. Low, who was also charged, is a fugitive.

Federal prosecutors in Brooklyn, New York, have asked the court to allow statements Ms Lim made to UBS Group bankers to be admitted as part of their case, calling her an uncharged "co-conspirator". They allege that 1MDB funds were transferred by a Low associate to the shell entity.

Leissner has told the jury he then directed that US$35.1 million of those funds be sent to the account under Ms Lim's control as kickbacks to Ng. The entity was originally called Silken Waters and renamed Victoria Square.

'Powerful evidence'

"Lim participated, at a minimum, in a conspiracy to launder criminal proceeds," prosecutors said in a March 16 letter to the court. Her statements about the transactions "are powerful evidence of both the fact that the defendant and his wife controlled the Silken Waters/Victoria Square bank account and that they sought to conceal their control - an essential element of the charged money laundering conspiracy".

While Ms Lim was not charged in the case, prosecutors said she helped her husband by opening the UBS account and the shell company on May 21, 2012, the same day the first 1MDB bond transaction closed.

Ms Lim arrived in the United States from Malaysia this week, according to the defence. Her lawyer Joshua Kirshner declined to comment on the government's allegations. Ms Lim concealed her role partly by opening the account in the name of her mother Tan Kim Chin and giving a "fake" e-mail address for her, according to the US. The government says the phone number given for the account was Ms Lim's own.

She also created a second false e-mail address she used to communicate with bankers that she later deleted, the US alleges. On Thursday (March 17), prosecutors showed jurors evidence about the creation and deletion of the accounts.

'Family money'

Leissner has testified that after the FBI handed him a federal grand jury subpoena tied to the 1MDB investigation in 2016, he met with Ng and Ms Lim in Hong Kong to concoct a "cover story" for the funds' origin.

He said they agreed they would all claim it was "a return of capital" from money Ms Lim had invested with his then-wife Judy Chan Leissner's family in China. Ng's defence lawyer Marc Agnifilo has argued the funds were for a separate business transaction between Ms Lim and Chan and were Ms Lim's "family money in Judy's business in China".

A court sketch showing witness Tim Leissner pointing out former Goldman Sachs banker Roger Ng in the Brooklyn federal court in New York on Feb 16, 2022. PHOTO: REUTERS

US District Judge Margo Brodie has not yet ruled on the government's request to admit Ms Lim's statements about the bank account and offshore entity.

In a response to the request, Mr Agnifilo argued in a filing on Friday that Ms Lim's statements to the UBS bankers should not be admitted because prosecutors had failed to establish that Ms Lim "knew at the time that the funds her family received from Judy Leissner were crime proceeds". He said Ms Lim's actions indicate only that she was preparing an infusion of money from Leissner's wife.

"Without that knowledge, Hwee Bin Lim could not have been part of a conspiracy to commit money laundering," Mr Agnifilo said. "Her statements to the financial institutions are therefore inadmissible hearsay and not co-conspirator statements."

He said Leissner's claims about the "cover story" are not credible because Leissner did not mention the Hong Kong meeting to law enforcement until January 2020, almost 18 months after he started cooperating.

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