Ex-Goldman Sachs partner outlines plot to loot 1MDB
Plan laid out a decade ago in Jho Low's home: Trial witness
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NEW YORK • A key witness in the bribery and money-laundering trial of a former Goldman Sachs executive said the scheme to loot billions of dollars from Malaysian sovereign wealth fund 1Malaysia Development Berhad (1MDB) was laid out a decade ago in the apartment of a flamboyant Asian businessman who remains on the run.
Tim Leissner, a former Goldman partner who has pleaded guilty in the scheme, testified in the Brooklyn federal court on Wednesday that the businessman, Low Taek Jho - also known as Jho Low - had told him and the defendant, his former colleague Roger Ng, about the plan to pay up to US$1 billion (S$1.34 billion) in bribes to foreign officials.
Ng's trial began on Monday and is expected to last several weeks. It will most likely be the only trial that will take place on American soil over the looting of 1MDB.
Leissner and a Goldman Sachs subsidiary have pleaded guilty in the case while Low, a free-spending financier who liked to host lavish parties in Las Vegas and Los Angeles, remains a fugitive.
Leissner, who said he had been "close friends" with Ng as well as his supervisor at Goldman in Asia, was the first prosecution witness to draw Ng into the centre of the brazen scheme to loot the 1MDB fund.
Prosecutors around the globe have said the money raised for the fund was supposed to finance infrastructure projects to benefit the Malaysian people, but was instead used to finance lavish spending by Low and others close to the country's former prime minister, Najib Razak.
Leissner said Low hosted the 2012 meeting at his London apartment. There, Low described in detail all the government officials who would be paid bribes in order for Goldman to secure the rights to arrange billions of dollars in bond offerings for the 1MDB fund, Leissner testified.
Low also told the former Goldman executives that the bribe money would have to come from the proceeds of the bond offering - and that they would get some of those proceeds as well, according to Leissner.
"Roger and I were told by Jho that we would be taken care of," Leissner said.
Leissner said he had known that the scheme was illegal but it did not bother him because securing the bond deals for Goldman would have produced big fees for the Wall Street bank.
"I wanted to be a hero at Goldman Sachs," he said.
It was Ng who introduced Leissner and several others at Goldman to Low in 2008, Leissner testified. He added that he and Ng soon realised that Low was the key to getting the bond underwriting work for Goldman, even though he had no position at 1MDB. "He never had any official role, yet he was the key decision-maker," Leissner said.
Low, who has been charged with bribery and money laundering, is believed to be residing in China.
Leissner said he and Ng both kept their dealings with Low from most of their Goldman colleagues after the bank officially rejected their efforts to bring him in as a wealth management client.
While several bankers at Goldman did know that Low was serving as a middleman in the 1MDB negotiations, only he and Ng knew the details of the looting of the fund, Leissner said.
On cross-examination, lawyers for Ng are expected to question Leissner on his character and his claims about the degree of Ng's involvement in the 1MDB negotiations. Defence lawyers could draw from a dossier that Goldman put together, presenting Leissner as a master con artist, while the bank was negotiating its own deal with prosecutors and regulators.
NYTIMES
Leissner said he had known that the scheme was illegal but it did not bother him because securing the bond deals for Goldman would have produced big fees for the Wall Street bank. "I wanted to be a hero at Goldman Sachs," he said.
