Malaysian in 1MDB scandal denies wrongdoing after USA charges

Saul Bowman
November 4, 2018

United States prosecutors unveiled criminal charges on Thursday against two former Goldman Sachs Inc bankers and fugitive financier Low Taek Jho.

In the indictment unsealed by a federal court Thursday, prosecutors accuse former Goldman Sachs banker Ng Chong Hwa and financier Low Taek Jho - known as "Jho Low" - with conspiring to launder money embezzled from 1Malaysia Development Berha - known as 1MDB - Malaysia's investment development fund, as well as conspiring to violate the Foreign Corrupt Practices Act.

Both men were charged with conspiracy to commit bribery and conspiracy to commit money laundering.

US prosecutors allege that Malaysian Low Taek Jho, usually known as Jho Low, was a central figure who orchestrated the ransacking of 1MDB. Low remains at large.

Goldman Sachs itself was not charged.

The filing of criminal charges in the matter was a rare move against senior executives of a major US bank in the decade since the financial crisis.

Former leader Mahathir Mohamad, outraged over the scandal, came out of retirement and the opposition united behind him in the national elections, leading to Najib's ouster in May.

At Harrow he became friends with Riza Aziz, stepson of former Malaysian Prime Minister Najib Razak, who set up 1MDB to support the country's economic development. It has previously denied any wrongdoing.

Leissner has pleaded guilty to two counts of conspiracy to commit money laundering and violating the FCPA.

Low, in a statement through his spokesman, maintained his innocence.

"Mr. Low simply asks that the public keep an open mind regarding this case until all of the evidence comes to light, which he believes will vindicate him", the statement said.

Since the election, Malaysian authorities have brought 38 charges against Najib.

The Wall Street bank said in a securities filing on Friday that it may also face penalties from dealings with 1MDB and is cooperating with various government probes. The banker, Andrea Vella, was put on leave in October, according to a person familiar with the matter.

In October 2014, Tim Leissner has paid an invoice of $ 4.1 million dollars in a jeweler in NY for the account of the wife of an official in malaysia were identified, underlines the ministry.

"After Project Magnolia closed on or about May 21, 2012, more than $500 million of the bond proceeds were misappropriated and diverted from 1MDB through numerous wire transfers to bank accounts in the name of shell companies beneficially owned and controlled by Low, Leissner, Ng and other co-conspirators", the release said.

Some of the funds went to finance the movie, "The Wolf of Wall Street", a 2013 Oscar-nominated film about Jordan Belfort, a corrupt stockbroker who was sent to prison for fraud, the government said.

Leissner acknowledged paying millions of dollars in bribes and kickbacks to government officials in Malaysia and Abu Dhabi, according to court records.

The government alleges they hid their partnership with Jho Low - whose real name is Low Taek Jho - from the financial institution because compliance and intelligence officers refused to approve the business relationship over concerns about the source of his wealth.

Another ex-Goldman official, Tim Leissner, pleaded guilty and agreed to pay US$43.7 million (S$60.2 million) in restitution of ill-gotten gains.

The DOJ started investigating due to claims that huge sums of stolen Malaysian public money were laundered through the USA financial system.

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