1MDB Trial Set to Begin for Ex-Goldman Banker Roger Ngo

The global scandal over the looting of a big Malaysian infrastructure fund nearly a decade ago — a crime that tarnished the reputation of one of Wall Street’s premier banks — is about to play out once again in a federal courthouse in Brooklyn.

The criminal money laundering and bribery trial of Roger Ng, a former Goldman Sachs banker, will begin Monday, with opening arguments and federal prosecutors calling their first witnesses.

The trial comes nearly four years after Mr. Ng, 49, a Malaysian resident, was indicted by federal prosecutors in Brooklyn. And it comes 16 months after Goldman pleaded guilty to a criminal charge and paid $5 billion in fines for its role in the far-reaching foreign corruption bribery scheme.

Jho Low, the mastermind of the scheme to loot more than $4 billion from the big Malaysian fund known as 1MDB, remains a fugitive and is believed to be living in China. Tim Leissner, the former Goldman partner who pleaded guilty in the summer of 2018 and has been cooperating with the government, is expected to be the prosecution’s star witness. He could begin testifying as soon as this week.

Mr. Ng and Mr. Leissner worked together at Goldman in Asia. Mr. Ng is said to have introduced his former partner and others at the bank to Mr. Low in 2009. At the time, Mr. Low was a young and flamboyant businessman who had befriended many Hollywood celebrities. He was known for throwing lavish Las Vegas parties and buying up expensive properties in Los Angeles and New York.

Prosecutors have charged that the three men and others plotted to pay $1 billion in bribes to top officials in Malaysia and other countries so that Goldman could arrange $6.5 billion in bond offerings for 1MDB, a government fund that was supposed to pay for projects to benefit the Malaysian people. But instead, prosecutors contend, much of that money was diverted to pay for the bribes and to line the pockets of Mr. Low, Mr. Leissner, Mr. Ng and even the former prime minister of Malaysia.

Money looted from 1MDB went to buy a boutique hotel in Beverly Hills, apartment buildings, artwork, a mega-yacht, a grand piano made of clear acrylic that was given to a supermodel as a gift and a share of the EMI Music Publishing portfolio. Some of the money even financed the Hollywood movie “The Wolf of Wall Street.” Most of the purchases were made by Mr. Low.

Mr. Leissner, who is married to the fashion designer and model Kimora Lee Simmons, agreed to forfeit up to $43.7 million as part of his guilty plea. One of Goldman’s most powerful deal makers in Asia before the scandal erupted in 2016, Mr. Leissner is expected to appear on the stand for several days once he begins testifying. Given his ties to Mr. Ng and Mr. Low, his testimony is seen as crucial to the government’s case.

But Mr. Leissner is likely to face a fierce cross-examination from Mr. Ng’s legal defense team. Lawyers could draw from a dossier that Goldman had put together, presenting Mr. Leissner as a master con artist who had a doctorate from a mail-order diploma mill and had affairs with powerful women in Asia, including a client of the firm’s. The bank gathered the material when it was negotiating its plea deal with prosecutors and bank regulators.

In court filings, prosecutors have acknowledged that Mr. Leissner was deceptive and frequently misled some at Goldman as to whether he was dealing with Mr. Low after being told not to. But authorities have faulted Goldman for accepting those denials at “face value.”

Prosecutors have claimed that Mr. Ng and his family, including his wife, got up to $35 million in illicit proceeds from the 1MDB bond offerings. But Mr. Ng’s defense team intends to present evidence that Mr. Ng was not a critical player in putting together the bond deals and the money came from legitimate unrelated transactions, according to court filings.

His lawyers are expected to argue that Mr. Ng and his family were owed money by Mr. Leissner’s former wife, who owns a large vineyard in China. Mr. Ng, they will contend, was unaware that the money they received came from proceeds that had been diverted from the 1MDB bond offering.

It is not known if Mr. Ng will testify on his own behalf.

Goldman Sachs is expected to have lawyers monitoring the proceedings. The bank’s Malaysian subsidiary pleaded guilty to one count of conspiring to violate the federal Foreign Corrupt Practices Act, and the parent company of the bank entered into a three-year deferred prosecution agreement on a similar charge. A number of Goldman employees, mainly from its compliance division, are expected to be called as witnesses.

In reaching a deal with prosecutors and regulators, Goldman also took steps to recoup or withhold more than $100 million in executive compensation, including to Lloyd Blankfein, the former chief executive.

The bank also slashed $10 million from the 2020 pay package for David Solomon, who replaced Mr. Blankfein as chief executive officer, in the wake of the guilty plea. But Goldman made up for most of that lost ground by recently approving $35 million in compensation for Mr. Solomon for 2021 — roughly $8 million higher than the $27.5 million he was supposed to have gotten in 2021.

Source

Hippo Sighting Report

Help us out, we really appreciate it.

Help contribute to our research, and let us know if you have seen similar situations that we may have missed. Our team will review the details you provide and add to our main list once we verify the information.

stay informed

Subscribe and get the updated Hippo List.

Get notified when we release our updated lists by email.

Make a Donation

Thank you for subscribing!

We will send you an email to confirm your details.  Welcome aboard!

Thanks for sending us your report.

We will review your information, and publish in on our list once we validate the details.