Malaysia charges for­mer Gold­man Sachs banker over 1MDB scan­dal

The Myanmar Times - Weekend - - Asean Focus -

MALAYSIA has filed crim­i­nal charges against a for­mer Gold­man Sachs banker in con­nec­tion with a multi­bil­lion-dol­lar scan­dal plagu­ing state fund 1Malaysia De­vel­op­ment Ber­had, or 1MDB.

The charges against Ng Chong Hwa, also known as Roger Ng, were filed Wed­nes­day -- two days after Gold­man Sachs sub­sidiaries and an­other key em­ployee were also slapped with a slew of in­dict­ments over the $6.5 bil­lion bonds the bank raised for 1MDB in 2012 and 2013 that saw the New York­based in­vest­ment bank­ing gi­ant re­ceive US$600 mil­lion in fees, deemed way above the in­dus­try norm.

Ng, who was the No. 2 man at the bank’s South­east Asia of­fice, pleaded not guilty to four charges un­der a se­cu­ri­ties law for abet­ting with it to, among oth­ers, con­ceal the role of fugi­tive fi­nancier Low Taek Jho, pop­u­larly known as Jho Low, in 1MDB.

Ng and Low are both wanted by US au­thor­i­ties who in Novem­ber in­dicted them and the other Gold­man Sachs em­ployee, Tim Leis­ner, for con­spir­ing to laun­der money and vi­o­lat­ing the law by brib­ing Malaysian of­fi­cials in re­la­tion to 1MDB.

Low has been de­scribed by the United States as the master­mind be­hind what it calls one of the world’s great­est heists, one in which some $4.5 bil­lion was be­lieved to have been mis­ap­pro­pri­ated from the state fund.

Leis­ner, who was Ng’s boss, had pleaded guilty in the United States.

In Malaysia, he, Low and Jas­mine Loo Ai Swan, who was 1MDB’S le­gal coun­sel, were all charged in ab­sen­tia on Mon­day un­der the same se­cu­ri­ties law for the com­mis­sion and abet­ment of false and mis­lead­ing state­ments in the lead-up to the bond is­suance.

The suit for the of­fenses un­der the Cap­i­tal Mar­kets and Ser­vices Act 2007 car­ries a jail term of not more than 10 years and a min­i­mum fine of 1 mil­lion ring­git (about $240,000), if con­victed.

Low and Loo have been on the run since the scan­dal blew up three years ago. Ng was ar­rested in Novem­ber by Malaysian po­lice and is cur­rently fight­ing his ex­tra­di­tion to face trial in the United States.

The 1MDB scan­dal that has sparked in­ves­ti­ga­tion across the globe due to its com­plex web of money trails has al­ready en­snared sev­eral bank­ing gi­ants like Deutsche Bank, Credit Suisse and UBS, which were pe­nal­ized for breach­ing anti-money laun­der­ing laws and con­trol lapses.

But this is the first time crim­i­nal charges were heaped on a bank such as Gold­man Sachs in both the United States and Malaysia over the scan­dal.

Gold­man Sachs claimed that it was duped by pre­vi­ous Malaysian gov­ern­ment and 1MDB of­fi­cials.

“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,” it said in a state­ment.

“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,” it added. – Ky­odo

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