Category Archives: Malaysia

(ZH) Malaysia Criminally Charges 17 Goldman Executives In 1MDB Scandal


After filing charges against the bankers who allegedly masterminded the bond deals that seeded Malaysian sovereign wealth fund 1MDB with billion of dollars for ‘development’ purposes, and then the three Goldman subsidiaries – Goldman Sachs International, Goldman Sachs (Asia) LLC and Goldman Sachs (Singapore) Pte. – operating in the region where the scam was perpetrated, Malaysia’s muckraking attorney general Tommy Thomas is now going after 17 current and former Goldman directors.

The criminal charges are the latest step in Thomas’s crusade to recover the billions of dollars – with a face value of $6.5 billion – that were allegedly stolen from 1MDB by former Prime Minister Najib Razak and his inner circle.

The Goldman directors were being charged under Malaysia’s Capital Markets and Services Act, which has provisions that hold senior executives responsible for violations committed by their organizations.

“They occupied the highest executive positions in those three Goldman Sachs subsidiaries, and exercised or ought to have exercised decision-making authority over the transactions of those bodies corporate,” a statement from Thomas’s office read.

In response to Thomas’s announcement, a Goldman spokesman said: “We believe the charges announced today, along with those against three Goldman Sachs entities announced in December last year, are misdirected and will be vigorously defended.”

This is a major turning point in the investigation, and despite Goldman’s legal heft, it’s unlikely that these top bankers will get off scott free. Thomas is threatening criminal fines and custodial sentences, “given the severity of the scheme to defraud and fraudulent misappropriation of billions in bond proceeds, the lengthy period over which the offences were planned and executed…and the relative value of the fees and commissions paid to Goldman Sachs.”

The move marks an escalation in the Malaysian government’s investigation into 1MDB. But perhaps it’s just Malaysia’s most aggressive push yet to convince Goldman to give in to its demands to hand over $7.5 billion in reparations over Goldman’s role in the scandal.

(Reuters) U.S. probes Deutsche Bank’s dealings with Malaysia’s 1MDB: WSJ


(Reuters) – The U.S. Justice Department is investigating whether Deutsche Bank AG (DBKGn.DE) violated foreign corruption or anti-money-laundering laws in its work for state fund 1Malaysia Development Berhad (1MDB), the Wall Street Journal said on Wednesday.The logo of Deutsche Bank is pictured on a company’s office in London, Britain July 8, 2019. REUTERS/Simon Dawson

The news comes after the bank announced plans to scrap its global equities unit, cut some fixed-income operations and slash 18,000 jobs globally in a 7.4-billion-euro ($8.34 billion) restructuring program.

Deutsche Bank’s work for 1MDB included helping to raise $1.2 billion in 2014 as concerns about the fund’s management and financials had begun to circulate, the newspaper said, citing unidentified people familiar with the matter.

Prosecutors are mainly looking into the role of Tan Boon-Kee, a colleague of a former Goldman Sachs Group Inc executive, Tim Leissner, who worked with him on 1MDB-related business, the paper said.

She left Goldman to become Asia-Pacific head of banking for financial institutions clients at Deutsche Bank, where she was involved with further 1MDB dealings, it added.

In an emailed statement, Deutsche Bank said it had fully cooperated with all regulatory and law enforcement agencies that made inquiries about the fund.

“As stated in asset forfeiture complaints filed by the U.S. Department of Justice, 1MDB made ‘material misrepresentations and omissions to Deutsche Bank officials’ in connection with 1MDB’s transactions with the bank,” the bank told Reuters.

“This is consistent with the bank’s own findings in this matter,” it added.

A U.S. DoJ civil asset-forfeiture complaint repeatedly describes Deutsche Bank as being misled by 1MDB officers, the WSJ said.

Tan left Deutsche Bank last year, after it discovered communications between her and Jho Low, the Malaysian financier the Justice Department has described as the central player in the 1MDB scandal, it added.

A representative of insurance company FWD Group, Tan’s current employer, said the company and Tan declined to comment.

The DoJ did not immediately respond to a request for comment from Reuters.

(Malaymail) FT: Once its star banker, Tim Leissner now the biggest threat to Goldman Sach’s reputation


Tim Leissner with his wife former supermodel Kimora Lee Simmons. — AFP file pic
Tim Leissner with his wife former supermodel Kimora Lee Simmons. — AFP file pic

KUALA LUMPUR, Dec 24 — Before the 1MDB scandal blew up his life, Tim Leissner was known as the good-looking star banker at Goldman Sachs married to former American model and now-TV celebrity Kimora Lee Simmons.

Today, Leissner is shunned by his former colleagues as was evident by his absence at a recent party to celebrate his former firm’s 150th anniversary.

The former rising star at Goldman Sachs earned his company “tens of miilions of dollars at this peak,” a Financial Times (FT) report said.

The same report added that Leissner may now be “the biggest ever threat” to Goldman’s reputation.

“Once praised by executives as an example to emulate, Mr Leissner has become a pariah inside the bank, after pleading guilty to bribery, conspiracy and money laundering charges in connection with a vast fraud at Malaysia’s state development fund,” FT reported.

While the Goldman Sachs has attempted to distance itself from the controversy, Leissner’s own admission that concealing information from the bank’s compliance officers was “very much in line” with Goldman Sachs’ business culture was a serious body blow.

The report stated that recent revelations that the bank’s now former chief executive Lloyd Blankfein met with fugitive businessman Low Taek Jho or Jho Low — who is at the heart of the scandal — in 2009 and 2012, raised further suspicion.

While the storied investment bank is no newbie to controversies, it may find the latest financial scandal a little harder to shake off.

Putrajaya had last week put an amount — US$7.5 billion (RM31.25 billion) — to the compensation it is seeking from Goldman Sachs for its blunder over 1MDB.

Finance Minister Lim Guan Eng told FT that the government is looking for reparation beyond the sum of its losses in the “excessive” US$600 million fees paid to Goldman Sachs and three bonds arranged by the bank.

“The bond offerings were always controversial, due to the high amount Goldman earned from the fundraising and the fact that it acted as a sole bookrunner on such a large deal.

“The long-term damage to Goldman’s franchise is hard to quantify. Executives say that so far it has been limited to Singapore and Malaysia. But the head of a rival investment bank argues that Goldman ‘won’t be as aggressive and as cute as it used to be … it will lose its edge’,” FT reported.

(VNA) Malaysia seeks 7.5 billion USD in reparations from Goldman Sachs


Motorcyclists pass a 1Malaysia Development Berhad (1MDB) billboard at the Tun Razak Exchange development in Kuala Lumpur, Malaysia (Photo: Reuters)
Hanoi (VNA) – Malaysian Minister of Finance Lim Guan Eng wants Goldman Sachs to pay 7.5 billion USD in reparations over its dealings with scandal-hit state fund 1MDB, a report said on December 21.

Lim told the Financial Times that Goldman should return 6.5 billion USD, which is the sum of three 1MDB bond issues arranged by Goldman in 2012 and 2013, plus 1 billion USD, to cover fees they earned plus interest payments on the bonds.

In a response to Lim’s comments, Goldman noted that a huge portion of money raised in the bond issues was “stolen for the benefit of members of the Malaysian government and their associates”, the Financial Times reported. 

Billions of dollars were purportedly stolen from the fund and used to buy everything from yachts to artwork, in an audacious fraud that allegedly involved former Malaysian Prime Minister Najib Razak and contributed to his government’s shock defeat in May elections.

Malaysia this week filed criminal charges against the bank and two of its former employees, alleging they took part in a scheme to steal huge sums while raising cash for the fund.

Malaysian Attorney General Tommy Thomas said criminal charges under the country’s securities laws were filed on December 17 against Goldman Sachs, its former bankers Tim Leissner and Ng Chong Hwa, former 1MDB employee Jasmine Loo and financier Low Taek Jho in connection with the bond offerings.

According to the Attorney, the charges arise from the commission and abetment of false or misleading statements by all the accused in order to dishonestly misappropriate 2.7 billion USD from the proceeds of three bonds issued by the subsidiaries of 1MDB, which were arranged and underwritten by Goldman Sachs.

Goldman has previously said it will fight the charges brought against it by Malaysian authorities and that members of the former government in Kuala Lumpur and 1MDB employees lied to the bank. 

Ng appeared before a Kuala Lumpur court on December 19 and pleaded not guilty. He has also been indicted in the US, and American officials are seeking his extradition. Meanwhile, Leissner has been indicted in the US and has pleaded guilty. 

Then Prime Minister Najib Razak founded the 1MDB investment fund in 2009, supposedly to serve Malaysia’s development through global partnerships and foreign direct investment.

However, it became the centre of a money laundering scandal, allegedly causing losses of billions of USD and leading to probes into the financial markets in several countries such as the US, Switzerland, Singapore, Malaysia and China.

After assuming power, Malaysian PM Mahathir Mohamad declared to give priority to addressing corruption and taking back losses of the fund. The Malaysian government has set up a task force to look into the scandal with help from the US, Switzerland, Singapore, Canada and other countries.-VNA

P.O. V.V.I. (FT) 1MDB scandal: the Malaysian fraud explained



The “Vampires of Wall Street” (nickname for Goldman Sachs) at it again…
One of the greatest finantial frauds in history…
USD 4.5 billion allegedly misappropriated from the Malasian State Investment fund.
The incredible number of transfers, and their complexity were designed to make it very difficult to trace the origin of the funds. (US Departement of Justice).
I sincerely hope (but i doubt it will happen) that with this scandal the “vampires” will be stopped for good.
Video not to be missed.

Francisco (Abouaf) de Curiel Marques Pereira

The FT’s Stefania Palma explains the corruption and money-laundering inquiry at the state development and investment fund in which charges have been filed against two former Goldman Sachs bankers, local financier Jho Low and ex-1MDB employee Jasmine Loo Ai Swan

(BBG) Goldman’s Woes Mount as Malaysia Slaps First Criminal Charge

(BBG) Malaysia is demanding Goldman Sachs Group Inc. bear the brunt of the 1MDB scandal, opening up another legal front for the Wall Street firm over its role raising money for the investment fund.

The country filed the first criminal charges against the U.S. bank in the global corruption probe on Monday, after publicly urging Goldman to come to the negotiating table or face litigation. The firm already is in the thick of investigations by U.S. prosecutors and regulators over Goldman’s conduct in the controversy.

Malaysian authorities allege that Goldman misled investors when the bank knew that proceeds from 1MDB bond sales it arranged would be misappropriated. The government is seeking fines in excess of both the $2.7 billion of allegedly misused funds and the $600 million in fees received by Goldman on the deals. Goldman has blamed rogue employees for any wrongdoing in relation to 1MDB, a state-owned investment fund.

“Their fraud goes to the heart of our capital markets,” Malaysian Attorney General Tommy Thomas said in a statement announcing the charges. “If no criminal proceedings are instituted against the accused, their undermining of our financial system and market integrity will go unpunished.”

Goldman Sachs’s role in raising about $6.5 billion for 1MDB in 2012 and 2013 has evolved into its thorniest scandal since the global financial crisis a decade ago triggered a public backlash against banks. Former Goldman partner Tim Leissner has pleaded guilty to U.S. bribery charges and his former deputy, Roger Ng, was arrested in Malaysia. And one of its senior investment bankers in Asia has been put on leave after being referenced in charging documents.

Goldman Sachs said it would “vigorously contest” the charges, which it said came without a chance for the firm to provide its view.

“Certain members of the former Malaysian government and 1MDB lied to Goldman Sachs, outside counsel and others about the use of proceeds from these transactions,” the bank said in an emailed statement Monday. “1MDB, whose CEO and board reported directly to the prime minister at the time, also provided written assurances to Goldman Sachs for each transaction that no intermediaries were involved.”

Goldman’s increasing proximity to the scandal has weighed on its stock, which is down about a third since the beginning of the year. That has erased its so-called Trump bump, a reference to the boost all major banking stocks received after President Donald Trump’s surprise victory in 2016. Goldman shares are now trading at the lowest level since October 2016.

Along with targeting the firm, Malaysia filed related charges against Leissner and Ng, as well as former 1MDB employee Jasmine Loo Ai Swan and fugitive financier Low Taek Jho.

The indictment focuses on circulars and memoranda that Goldman prepared for the 1MDB bonds, saying that they contained statements that were false or misleading or both. Malaysia is pursuing the claim on the basis that the relevant bond documents were sent to the regulator in its offshore banking haven in Labuan, and therefore were covered by its securities law, Thomas said in the statement.

Read a QuickTake explainer on Goldman’s 1MDB deals

Malaysia is filing the charges against three of the bank’s units — Goldman Sachs International (UK), Goldman Sachs (Singapore) and Goldman Sachs (Asia) LLC — the Edge newspaper reported, citing charge sheets from the Kuala Lumpur court.

“The criminal charges of this nature are grave, and it goes to the core of Goldman’s business as an investment bank,” said Nizam Ismail, a partner at RHTLaw Taylor Wessing LLP in Singapore. “If the outcome of the case results in a criminal conviction against the bank, there are potentially severe reputational and financial risks to the bank, as well as the bank’s standing as a licensed financial institution with regulators worldwide.”

Goldman 1MDB Charges Will Give Bankers Shivers: Andy Mukherjee

Officials in Malaysia had previously said they were seeking a full refund from Goldman Sachs for the fees it received for the 1MDB bond sales. The $600 million Goldman earned from the bond issues dwarfed what banks typically make from government deals.

Malaysian financier Low Taek Jho, the alleged mastermind of the schemes to siphon billions of dollars from 1MDB, was also charged in absentia in the U.S. He was accused of conspiring with Ng, then a Goldman Sachs banker, to launder billions of dollars embezzled from 1MDB, known formally as 1Malaysia Development Bhd.

A spokesman for Low issued a statement from his attorneys that he maintained his innocence.

The Federal Reserve, meanwhile, is ramping up an investigation into how executives dodged the bank’s internal controls while helping Malaysian authorities raise the money, people briefed on the matter said late last month. The probe examines the actions of Goldman Sachs as well as individuals and has been gaining momentum, the people said, asking not to be identified because the inquiry is confidential.

Leissner’s guilty plea suggests he’s helping U.S. authorities with their investigation of the bank. Other regulators are examining if its conduct points to a broader pattern of prioritizing lucrative business deals at the expense of following rigorous compliance standards.

Read about how 1MDB scandal shook the financial world.

And two Abu Dhabi funds — International Petroleum Investment Co. and Aabar Investments — have filed a civil suit against Goldman Sachs in New York, seeking damages for alleged fraud in connection with embezzlement at 1MDB.

(BBG) Malaysia Files Criminal Charges Against Goldman Sachs and Its Employees

(BBG) Bank Valuations Have Been Driven by Yield Curve, Goldman’s Kostin Says

Kapstream Capital’s Goldman Sees ‘Zero to One’ Fed Hike in 2019

Malaysia has filed criminal charges against units of Goldman Sachs Group Inc. involving what it said were false statements made in relation to 1MDB bond sales.

The government will seek fines well in excess of both the $2.7 billion of allegedly misappropriated funds and the $600 million in fees received by Goldman for the 1MDB deals, Attorney General Tommy Thomas said in a statement.

The allegations, the first criminal charges against Goldman since it was embroiled in the 1MDB scandal, relate to three bond sales worth $6.5 billion that the bank arranged for the troubled state fund. Malaysia said circulars and memorandums that Goldman prepared for the notes contained statements that were false or misleading or both.

Goldman allegedly misrepresented to investors that the proceeds would be used for legitimate purposes, when the bank knew that the funds would be misappropriated, the statement said.

“Their fraud goes to the heart of our capital markets,” Thomas said in the statement. “If no criminal proceedings are instituted against the accused, their undermining of our financial system and market integrity will go unpunished.”

Goldman will “vigorously defend” against the charges, spokesman Edward Naylor said in an email. “We believe these charges are misdirected,” he said, adding that the bank continues to cooperate with all authorities investigating the matter.

Related charges were also filed against the bank’s former employees Tim Leissner and Roger Ng, as well as former 1MDB employee Jasmine Loo Ai Swan and fugitive financier Low Taek Jho. Malaysia will seek custodial sentences against each of the accused individuals with a maximum term of 10 years, according to the statement.

(Algemeiner) Days After Virulent Anti-Israel Speech, Antisemitic Malaysian Prime Minister Feted During Visit to Britain


Malaysian Prime Minister Mahathir Mohamad. Photo: Reuters / Lai Seng Sin.

The Prime Minister of Malaysia, Mahathir bin Mohamad, is being feted during a two part visit to Britain despite a long history of antisemitic statements and a virulent anti-Israel speech delivered at the General Assembly of the United Nations last week.

According to the UK’s Daily Mail, on his initial arrival in Britain last week, Mohamad first visited Imperial College, where he was warmly welcomed by the vice-president and provost. He followed this with a visit to Oxford University, where he gave a speech at the Centre for Islamic Studies. He will shortly deliver a speech at Chatham House, a major British think tank.

The Chairman of the Campaign Against Anti-Semitism, Gideon Falter, told the Mail, “It is utterly appalling that at a time when antisemitism is so raw, a man who is proud to be an antisemite is being courted. It is equally unforgivable that he was invited to tour our most prominent educational institutions and share his opinions with students.”

“Those who have extended the red carpet treatment to this abhorrent racist and self-confessed antisemite must apologize,” he added. “We are looking into whether universities may have breached their own codes on racist speakers.”

The Palestinian Authority has registered a complaint with the International Court of Justice in the Hague that charges the US…

Mohamad is perhaps one of the world’s most powerful antisemites. He has said that he is “glad to be labelled anti-Semitic” and equated the Jews with the Nazis.

“The Europeans killed six million Jews out of 12 million,” he said in 2013. “But today the Jews rule this world by proxy. They get others to fight and die for them.”

In 2010, he stated, “Jews had always been a problem in European countries. They had been confined in ghettos and periodically massacred. But they still remained and still thrived and held whole governments to ransom. Even after their massacre by the Nazis in Germany, they survived to be a source of even greater problems to the world.”

Mohamad has also asserted that Jews “are not merely hook-nosed, but understand money instinctively.”

In his UN speech on Friday, Mohamad blamed Israel for world terrorism and endorsed the Palestinian “right of return,” which would entail the destruction of the Jewish state by weight of demography.

Saying “this present war against the terrorist will not end until the root causes are found,” Mohamad asked, “What are the root causes? In 1948, Palestinian land was seized to form the state of Israel. The Palestinians were massacred and forced to leave their land. Their houses and farms were seized.”

Apparently referring to the 1967 Six Day War, he added, “They tried to fight a conventional war with help from sympathetic neighbors. The friends of Israel ensured this attempt failed. More Palestinian land was seized. And Israeli settlements were built on more and more Palestinian land and the Palestinians are denied access to these settlements built on their land.”

The Six Day War was the result of the massing of Arab armies on Israel’s borders with the declared intention of annihilating Israel.

Regarding Palestinian violence, Mohamad declared, “The Palestinians fired ineffective rockets which hurt no one. Massive retaliations were mounted by Israel, rocketing and bombing hospitals, schools and other buildings, killing innocent civilians including school children and hospital patients.”

He condemned the US’s recognition of Jerusalem as Israel’s capital, saying it was “deliberately provoking Palestine.”

Referring to the Palestinian use of terrorism, Mohamad said, “It is the anger and frustration of the Palestinians and their sympathizers that cause them to resort to what we call terrorism.”

“Let the Palestinians return to reclaim their land,” said Mohamad, endorsing the right of return. “Let there be a state of Palestine. Let there be justice and the rule of law. Warring against them will not stop terrorism. Nor will out-terrorising them succeed.”