A former Goldman Sachs Group banker and a Malaysian financier were charged with conspiring to launder billions of dollars embezzled from a Malaysian sovereign wealth fund for which the investment bank was a major bond underwriter, while another banker who worked at Goldman pleaded guilty to related charges, according to an announcement Thursday from the Department of Justice.
Former Goldman Sachs managing director Ng Chong Hwa, known as Roger Ng, and Low Taek Jho, the Malaysian financier known as Jho Low, allegedly conspired to launder funds from 1Malaysia Development Berhad (1MDB), according to the indictment, filed in federal court in Brooklyn. Ng and Low also were charged with conspiring to violate the Foreign Corrupt Practices Act by paying bribes and kickbacks to various Malaysian and Abu Dhabi officials to secure bond deals for the bank, according to the indictment.
“The firm continues to cooperate with all authorities investigating this matter,” a spokesman for Goldman said in an emailed statement.
Ng also was charged with conspiring to violate the FCPA because he allegedly circumvented internal controls at the bank, which underwrote more than $6 billion in bonds issued by 1MDB when Ng still worked there, according to the indictment. The federal government did not identify the bank in the court document or Department of Justice announcement.
Ng was arrested on Thursday in Malaysia, according to the DoJ announcement revealing the charges. Low remains at large. Another former Goldman banker, Tim Leissner, has pleaded guilty to charges of conspiring to launder money and to violations of the Foreign Corrupt Practices Act over his role in the scheme, the DoJ said. He was ordered to forfeit $43.7 million.
1MDB is a Malaysian state-owned and controlled economic development fund — launched in 2009 by former Malaysian prime minister Najib Razak — that was intended to pursue investment and development projects for the country but instead became the epicenter of a massive scandal.
Between 2009 and 2014, while the fund was raising money to pursue projects, billions of dollars were being misappropriated from the fund, including funds raised through three bond transactions with Goldman in 2012 and 2013, according to the DoJ’s announcement.
“As part of the scheme, and as alleged in court filings, Low, Ng, Leissner, and others conspired to bribe government officials in Malaysia, including at 1MDB, and Abu Dhabi to obtain and retain lucrative business for the financial institution, including the 2012 and 2013 bond deals,” the DoJ said, without identifying the bank.
“They also allegedly conspired to launder the proceeds of their criminal conduct through the U.S. financial system by purchasing, among other things, luxury residential real estate in New York City and elsewhere, and artwork from a New York-based auction house, and by funding major Hollywood films” including The Wolf of Wall Street, the Justice Department said.
A message left for Leissner’s attorney was not immediately answered. A call to Low’s attorney was not immediately returned. It could not be determined by time of publication who represents Ng.
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